Cloudflare Capital Reorganization Interim Appeal Certification... Good Faith Standard Also an Appeal Issue

Cloudflare’s ($NET) proposed capital-structure overhaul remains blocked after Delaware’s Court of Chancery certified an interlocutory appeal of the preliminary injunction halting the plan, which would let founders reduce their economic stake while preserving voting control. The court’s Nov. 3 opinion asks the Delaware Supreme Court to review whether the existing “Disney standard” still applies and whether a special committee’s good faith should be assessed director by director. Certification only permits early Supreme Court review; it does not mean the appeal was accepted or the injunction lifted. The case matters because the ruling could shape how controlled companies structure founder voting rights and how Delaware courts weigh board good faith. Next, watch whether the Delaware Supreme Court accepts the appeal and how it treats the Disney standard and director-level good-faith review.