Decision to force-sell company: loss for Del. workers?

The debate over a court-ordered sale of a successful New York based company is now before the Delaware Supreme Court.

It was a battle of words Wednesday morning in Dover during oral arguments between the legal teams of Phillip Shawe and Elizabeth Elting, the two co-founders of TransPerfect. The translation services, founded in the 1990's, is incorporated in Delaware.

Elting owns 50 percent of the company. Shawe and his mother Shirley Shawe own 49 percent and 1 percent, respectively.

The court-ordered decision to sell the company was made in 2015 after a judge concluded the feuding company co-founders deadlocked over significant matters and business decisions. The court argued it caused the company to suffer, according to the Associated Press.

During oral arguments to reconsider this decision Wednesday, David Goldstein, an attorney for Shawe challenged whether the Delaware Court of Chancery had the authority to do it in the first place.

"There's no case in which a court has ordered a forced sale of a shareholder's shares to resolve deadlock, but it's in excess of the court's powers under [section] 226, and it unnecessarily disturbs settled expectations under Delaware law," explains Goldstein.

Phil Kaufman, an attorney for Elting, argued the law cited in the initial ruling has been in place for half a century.

Kaufman told the five-justice court the profitable success of the company was undisputed; however, he argued the facts of the case "overwhelmingly demonstrate" selling the company to the highest bidder would be in the best interest, given the co-founders' history.

"The only way for this company to be protected, to save this company, and its 4,000 employees' jobs is to sell this company because unless that happens, this company is going to continue along the poisonous course," says Kaufman.

Outside of the courtroom, local advocates were busy justifying why the company should not be sold at a press conference held about an hour before oral arguments.

Chris Coffey, campaign manager for Citizens For A Pro-Business Delaware, says if the sale of TransPerfect goes through, it could mean the loss of jobs for up to 100 Delawareans currently employed with the company.

According to Coffey, the company has proven to be "boomingly successful" with an unbroken growth of profits and employees. He tells 47ABC, selling the company would be a major threat for future growth for the state.

"If companies feel that they can't come to Delaware anymore to incorporate, because they're at risk of a judge in Delaware forcing the sale of their company. You'll have folks who will stop coming here," he says.

No decision was made Wednesday. We're told the process could take up to three months; however, timelines are case-by-case.