Musk Appeasement Gambles Delaware’s Corporate Golden Goose

A proposed shift in legal power from smaller investors toward moguls like Elon Musk is dividing Delaware’s business community over the state’s future as America’s corporate capital.

State Senate Bill 21, unveiled in February, would limit judges’ discretion to scrutinize insider deals, shrink the category of documents available to shareholders, and make it harder to prove boards are beholden to a dominant force like Musk. The proposal follows Musk’s year-long crusade against the court system that cost him $56 billion.

A split has emerged over whether those measures would save or kill Delaware’s golden goose—corporate franchise taxes generate ...