Meta, the parent company of Facebook, Instagram and WhatsApp, is exploring changing its incorporation location from Delaware to another state. According to two people familiar with the matter, the company is considering Texas and a few other options.
The move comes as Meta undergoes a corporate overhaul under Mark Zuckerberg’s leadership. Mr. Zuckerberg has been implementing workforce cuts and reorganizing the company to operate more quickly and efficiently. He has also been courting policymakers in Washington on issues such as antitrust and artificial intelligence.
Meta has faced several shareholder lawsuits filed in Delaware courts, including one related to user privacy concerns with Cambridge Analytica in 2018. By incorporating in a more favourable state like Texas, Meta hopes to avoid future litigation and regulatory challenges.
In 2022, Elon Musk’s SpaceX switched its incorporation from Delaware to Texas after a Delaware judge voided his pay package at Tesla. Musk has expressed confidence that Texas courts will be more permissive of his business practices. Corporate law professor Eric Talley agrees, saying that Texas courts are likely to provide more leeway for companies to operate as they see fit.
Talley notes that Meta’s dual-class stock structure gives Mr. Zuckerberg significant control over the company, which could be challenged by recent Delaware court rulings. He believes that incorporating in Texas will give Meta a more favourable regulatory environment and allow it to pursue its business agenda with greater freedom.
Source: https://www.nytimes.com/2025/01/31/technology/meta-incorporation-delaware.html