The Supreme Court fractured over how to interpret a Delaware statute governing activist-investor takeovers, with justices clashing over whether courts should enforce legislative intent or defer to judicial preference.

The case centered on Delaware's anti-takeover law and its application to activist campaigns targeting corporate boards. Delaware, home to most major U.S. corporations, has long shaped takeover jurisprudence through its Court of Chancery and Supreme Court.

Justice Samuel Alito led the majority in rejecting a broad reading of the statute, arguing that courts must respect the narrow terms lawmakers actually wrote rather than expanding language to reach perceived legislative goals. Alito stressed that judges cannot substitute their policy preferences for what the statute plainly states.

The dissenters, led by Justice Elena Kagan, countered that the majority ignored contextual signals of legislative intent. Kagan argued that rigid textualism divorces statutes from their purpose and forces courts to reach absurd results lawmakers never contemplated. The liberal justices warned that strict textualism amounts to judges imposing their own views under a different guise.

This interpretive clash has practical stakes for corporate governance nationwide. The decision affects how easily activist investors can wage proxy contests and challenge entrenched boards. Corporations relying on Delaware law to defend against unwanted takeovers face uncertainty about which defensive measures remain valid.

The fractured opinions reveal deeper disagreement about judicial restraint. Conservative justices emphasized that legislatures, not courts, set corporate law policy. Progressive justices stressed that statutes require purposive reading to avoid rendering legislative protections meaningless.

The Delaware Court of Chancery and the state Supreme Court must now navigate this Supreme Court division when hearing future takeover disputes. Corporate counsel will struggle to predict outcomes when interpreting Delaware statutes, particularly those addressing shareholder rights and board authority.

The decision leaves activist investors and target corporations without clear guidance on