Delaware is facing a further exodus of tech companies amid reports that Meta and Dropbox are moving out of the state.

Newsweek has contacted Meta and Dropbox for comment via email.

Why It Matters

Delaware has long been considered a business-friendly state due to its corporate tax advantages, and is home to multiple large companies. However, backlash against the First State has intensified after Delaware Judge Kathaleen McCormick ruled that Tesla CEO Elon Musk’s record-breaking $56 billion compensation package was excessive.

Musk, who has become increasingly influential in both the political and corporate world, urged companies to pull out of the Democratic-led state. In February 2024, he announced that SpaceX was relocating its incorporation from Delaware to Texas, following Tesla’s corporate move from California to Texas in 2021.

What to Know

Meta, the parent company of Facebook, Instagram, and WhatsApp, is reportedly considering moving its incorporation from Delaware to another state, such as Texas, according to reports in the national press.

The company has been in talks with Texas officials about the potential move, though other states are also being considered. An unnamed source told The Wall Street Journal that these discussions predated former President Donald Trump’s return to office.

Musk holds a role in the new Trump administration as head of the Department of Government Efficiency (DOGE).

The move would not involve Meta relocating its corporate headquarters out of California.

Texas is perceived as having a more favorable legal and regulatory environment for businesses, particularly in taxation and corporate governance, Reuters reported.

Meanwhile, file-hosting service Dropbox is also said to be moving its incorporation from Delaware to Nevada.

The move was revealed in a letter to stockholders that has been shared on social media. Dropbox said it has received approval from a majority of shareholders to proceed with the transition.

What People Are Saying

Stephen Bainbridge, a law professor at the University of California, Los Angeles, told The Wall Street Journal: “The Texas state government is trying to send out signals that the Texas state courts will be more friendly to businesses than the Delaware court has been. But there’s no guarantee that that’s going to happen.”

Eric Talley, a corporate law and governance professor at Columbia Law School, told The New York Times: “One could read this as a bet that because Musk moved Tesla and some of his other companies to Texas, the client effects will be that it’ll develop a jurisprudence friendly to controllers. The hope that Musk and Zuckerberg have is that the courts in Texas will be much more permissive about them doing whatever they want, even if it involves a conflict of interest. There’s a much longer leash in Texas.”

Robert Anderson, a law professor at the University of Arkansas, posted on X, formerly Twitter: “Dropbox is also leaving Delaware. It’s happening. For those who don’t spend their days studying corporate law, today is an absolutely seismic event.”

Elon Musk in a January 2024 post on X: “Never incorporate your company in the state of Delaware

Dropbox, in a message to stockholders, stated: “Stockholders of the company holding at least a majority of the voting power of our outstanding shares of capital stock entitled to vote adopted resolutions by written consent in lieu of a meeting of stockholders to approve the reincorporation of the company from the state of Delaware to the state of Nevada by conversion.”

What Happens Next

It remains unclear when or if Meta and Dropbox will officially move out of Delaware.

A Middletown school administrator was arrested after state prosecutors say he uploaded child sexual abuse material online to a messaging app.

The Delaware Department of Justice announced 25 felony charges involving possession of child sexual abuse material against 43-year-old Justin Smith, the head of school at St. Anne’s Episcopal School since July of 2024. The Justice Department said Friday night that they have “no indication” at this time that Smith’s crimes are linked to his role at the school.

Still, they noted St. Anne’s − a self-described independent school serving grades preschool through eighth, according to its website − is “fully cooperating” with the investigation.

Attorney General Kathy Jennings called the evidence “shocking and abhorrent” in a written statement Friday, noting that Smith’s job put him in a position of trust with children.

Smith’s charges do not involve contacting a child, according to the DOJ, and there are no victims affiliated with the school or community at this time.

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Because of Smith’s job, however, the state is asking the public to come forward with any information they may have in this case. Anyone with information can contact the Delaware Internet Crimes Against Children Task Force at (302) 739-2030. 

What prompted the investigation of Justin Smith?

Investigators from the state Department of Justice and Delaware State Police, as part of the Internet Crimes Against Children Task Force, received multiple CyberTips from Kik Messenger warnings, according to the Justice Department. The warnings indicated that social media accounts belonging to Smith had uploaded child sexual abuse material from an IP address belonging to Smith.

The tips prompted investigators to execute search warrants on the social media accounts, the state said, which found more child sexual abuse material.

Smith was arraigned and taken to Howard R. Young Correctional Institution on $625,000 cash bail.

CreatieVeterans focuses on small, supportive classes capped at 12 participants, allowing veterans to explore a variety of artistic techniques that vary across all three counties.

“In New Castle County, we have ‘Working with Clay.’ In this, specifically, participants will use hand-building techniques with clay, including pinching, quilling slab and texture technique,” Henry said. In quilling slab, artists shape designs out of tiny strips of clay.

“We have in Kent County, ‘Gelli Plate Printing with ‘Es,’’” Henry said. Gelli plate is a gelatin-like plate made of solidified mineral oil that’s used to transfer images onto a canvas.

“Veterans can “explore by transforming magazines and images in nature and different textures you can put on the plate,” Henry said. “Then, in Sussex County, we have ‘Mixed-Media Collage Making.’ This is exploring craft embellishments, paper and found art materials and they’ll be making these collages on wood.”

Ensuring accessibility across all three counties was a central focus of the program’s design.

“I feel like it is known that New Castle [County] in general gets more of a focus. It’s kind of known as an art hub,” she said. “It’s really important that we reach Kent County and Sussex County, you know, the more rural areas. So, no one has to drive up to New Castle County or north. It’s important that they have access right near them.”

“This is all for all genders, all ages for veterans. This is a mix of a lot of different generations together and I feel like that impact can allow so much value and insight,” Henry added. “Depending on where those veterans served, what branch. I just think it allows a lot of opportunity for veterans to create a bigger community than they already have.”

Some of the eight-week sessions are already underway, participants are preparing to share their creations in community exhibitions held in each county. These exhibitions will allow veterans to celebrate their accomplishments with family, friends, and local supporters.

While New Castle County’s class is fully booked, veterans are still encouraged to register for classes in Kent and Sussex Counties.