Delaware Chancery blocks Cloudflare founder-control recapitalization in major test of Section 144 safe harbor
Vice Chancellor J. Travis Laster on October 16, 2026, preliminarily enjoined Cloudflare's recapitalization, which would have preserved co-founders Matthew Prince and Michelle Zatlyn's voting control through new preferred and nonvoting shares. The court sided with defendants on every question under the 2025 DGCL Section 144 safe harbors but found stockholders reasonably likely to prove the special committee failed to act in good faith, and ordered a prompt trial.
Opinion (Delaware Court of Chancery) → · Bloomberg Law, Law360