Move to Change Delaware Law After Musk Attacks Called Knee-Jerk

Calls for Delaware’s legislature to overturn a landmark court decision are dividing the state’s corporate bar over whether a statutory fix would be an overcorrection.

An influential committee is urging the legislature act to restore the status quo after a judge upended a popular corporate strategy in February. The proposal aims to put stockholder agreements—a key tool for boards defusing proxy fights and venture capital firms leading public listings—back on the right side of the law.

The move to directly override a court ruling looks uncomfortably like a concession to Elon Musk, who has publicly threatened to move Tesla Inc. ...