COURT OF CHANCERY OF THE STATE OF DELAWARE NATHAN A. COOK LEONARD L. WILLIAMS JUSTICE CENTER VICE CHANCELLOR 500 N. KING STREET, SUITE 11400 WILMINGTON, DELAWARE 19801-3734
July 11, 2025
William E. Green, Jr. Scott B. Czerwonka John G. Harris Wilks Law LLC Timothy S. Spangler, III 4250 Lancaster Pike, Suite 200 Halloran Farkas + Kittila LLP Wilmington, DE 19805 5722 Kennett Pike Wilmington, DE 19807
RE: Benjamin Nazarian, et al. v. Khosrow (Jack) Sassouni, et al., C.A. No. 2025-0052-NAC
Dear Counsel:
I am asked to decide a number of difficult and close questions of fact and law.
This is not one of them.
Plaintiffs Benjamin Nazarian and Eliott Sassouni bring this action under 8
Del. C. § 225 seeking a determination of the proper composition of the board of
directors of Iridium Industries Inc. (“Iridium” or the “Company”), a Delaware
corporation. Plaintiffs also seek additional declaratory relief. In response, Defendant
Khosrow (Jack) Sassouni moves to dismiss or stay in favor of litigation pending in
New York.
After a trial on a paper record, I conclude Iridium’s board of directors consists
of Jack Sassouni, Benjamin Nazarian, and Eliott Sassouni. As explained below, I am C.A. No. 2025-0052-NAC July 11, 2025 Page 2 of 24
denying Defendant’s motion to dismiss or stay, and my judgment is for Plaintiffs on
Counts I, II, and III. As to Count IV and Plaintiffs’ request for an award of attorneys’
fees, I decline to address both at this time.
I. FACTUAL BACKGROUND
The following facts were stipulated by the parties or proven by a
preponderance of the trial evidence.1
A. The Company
In 1998, brothers Khoshrow (Jack) Sassouni and Eli Sassouni founded
Iridium.2 Today, Iridium remains a privately held company3 and is a leading United
States manufacturer of squeezable plastic tubes.4 The Company does business under
the trade name “Artube.”5
Eli passed away on April 9, 2009.6 At the time of Eli’s death, the Company had
1,000 shares of common stock issued and outstanding, held by three stockholders:
1 Joint trial exhibits are cited as “JX ___.” When discussing individuals with the same last name, the Court relies on first names for convenience. No disrespect is intended.
2 Benjamin Nazarian, et al. v. Khosrow (Jack) Sassouni, et al., C.A. No. 2025-0052-NAC,
Docket (“Dkt.”) 61, Pre-Trial Stipulation and] Order (“Pre-Trial Stip.”) ¶¶ 26, 28; see also JX 1.
3 Pre-Trial Stip. ¶ 26.
4 Id. ¶ 27.
5 Id.
6 Id. ¶ 30. C.A. No. 2025-0052-NAC July 11, 2025 Page 3 of 24
Jack, Eli, and Eli’s father-in-law, Parviz Nazarian.7 Each brother held 400 shares of
common stock, and Parviz Nazarian held 200 shares of common stock.8 Eli
bequeathed his 400 shares to trusts for the benefit of his wife and each of his three
sons.9
Parviz Nazarian passed away on August 23, 2017, and bequeathed his 200
shares of Iridium stock to his wife, Pouran Nazarian.10
B. Eli’s Will
The Last Will and Testament of Eli Sassouni (the “Will”) created four
testamentary trusts.11 Article SIXTH of the Will created a trust for the benefit of
Eli’s wife, Dalia Sassouni, (the “Marital Trust”).12 The Martial Trust owns 166 shares
of Iridium common stock.13 Article FIFTH of the Will created three trusts for the
benefit of Eli’s three children: Plaintiff Eliott Sassouni, Ethan Sassouni, and Ryan
Sassouni (the “Article Fifth Trusts” and, together with the Marital Trust, the
7 Id. ¶ 29.
8 Id.
9 Id. ¶¶ 30, 32.
10 Id. ¶ 31.
11 Id. ¶ 32.
12 Id. ¶ 33.
13 Id. C.A. No. 2025-0052-NAC July 11, 2025 Page 4 of 24
“Trusts”).14 Each of the Article Fifth Trusts holds 78 shares of Iridium common
stock.15 The Article Fifth Trusts collectively hold 234 shares.16
The Will appointed Dalia and Jack as co-trustees of the Trusts.17 Under Article
THIRTEENTH of the Will, Jack, as co-trustee, had the power to make all decisions
with respect to the Trusts’ interests in Iridium—including voting the stock.18
C. The New York Litigation
In 2018, Dalia, Eliott, Ethan, and Ryan, as beneficiaries of the Trusts, filed
petitions in the New York Surrogate’s Court to compel Jack to account as co-trustee.19
In 2023, following trial, the New York Surrogate’s Court removed Jack as co-trustee
of the Marital Trust.20 All parties to the Surrogate’s Court proceedings appealed the
decision as of right.21 The New York appellate court deemed those appeals
14 Id. ¶ 34.
15 Id.
16 Id.
17 See JX 4 (Last Will and Testament of Eli Sassouni).
18 Pre-Trial Stip. ¶ 38; see also JX 4.
19 JX 6 at 2.
20 Pre-Trial Stip. ¶ 39.
21 Id. C.A. No. 2025-0052-NAC July 11, 2025 Page 5 of 24
premature.22 Jack then sought to appeal his removal as trustee by permission.23
That application remains pending.24
On November 1, 2023, the New York Surrogate’s Court issued successor letters
of trusteeship appointing Dalia and Benjamin as co-trustees of the Marital Trust.25
On June 5, 2024, the New York Surrogate’s Court issued temporary letters of
trusteeship appointing Dalia and Benjamin as co-trustees of the Article Fifth
Trusts.26 Jack appealed his temporary suspension as trustee of the Article Fifth
Trusts and Benjamin’s appointment as temporary co-trustee in his place.27 That
appeal remains pending.28
D. The December 9 Stockholders’ Meeting
On September 13, 2024, after his appointment as co-trustee of the Trusts,
Benjamin emailed Jack requesting that he call a meeting of stockholders and
attaching a notice of special meeting of Iridium’s stockholders and a draft waiver of
22 Id.
23 Id.
24 Id.
25 Id. ¶ 40.
26 Id. ¶ 41.
27 Id.
28 Id. C.A. No. 2025-0052-NAC July 11, 2025 Page 6 of 24
notice.29 The agenda included with the notice contained three potential items of
business: amending the Company’s bylaws, electing Jack, Benjamin, and Eliott as
directors, and considering any other matters properly brought forward.30
The parties negotiated the logistics of the stockholders’ meeting through
counsel—ultimately, agreeing to hold the meeting at 2:00 p.m. on December 9, 2024.31
Before the meeting, Benjamin’s counsel asked Iridium to issue updated stock
certificates and requested that Defendant’s counsel confirm which stockholders could
vote and how many shares they held.32 Defendant’s counsel responded, stating in
relevant part: “While Iridium will not be issuing the requested new stock certificates
(for reasons including, but not limited to, the pendency of the litigations concerning
the trusteeship of both the Article Sixth and Article Fifth trusts), Iridium will agree
that, for the limited purpose of the December 9 meeting, Pouran and Ben (the latter
as the current trustee of the aforementioned trusts) have the right to vote the
shares.”33
29 Id. ¶ 42; see also JX 18.
30 Pre-Trial Stip. ¶ 43; see also JX 18 at 21.
31 Pre-Trial Stip. ¶¶ 44, 46; see also JX 18.
32 See e.g., JX 18 at 6.
33 Pre-Trial Stip. ¶ 45; see also JX 18 at 8. C.A. No. 2025-0052-NAC July 11, 2025 Page 7 of 24
Benjamin appeared at the December 9 stockholders’ meeting in person.34
Pouran Nazarian appeared at the meeting by proxy given to Eliott,35 and Jack
appeared at the meeting by proxy given to his counsel.36 The first item on the agenda
was amending the Company’s bylaws to, among other things, expand the board of
directors to three.37 Benjamin, as co-trustee of the Trusts, and Eliott, as proxy for
Pouran, voted for the amendments.38 Jack, through his counsel, voted against the
amendments.39
Out of the 1,000 shares outstanding, 600 shares were voted for the
amendments and 400 shares were voted against the amendments.40 After the vote,
Jack’s counsel confirmed that the bylaws were amended, but stated that “the
amendment[s] [are] going to be held in abeyance until there is a resolution of the
litigation pertaining to Mr. Nazarian’s trusteeship and ability to vote the Trust
34 Pre-Trial Stip. ¶ 50.
35 Id. ¶ 49; see also JX 19.
36 Pre-Trial Stip. ¶ 48; see also JX 20.
37 JX 22 at 1.
38 Id. at 2.
39 Id. at 1.
40 See id. at 1–2. C.A. No. 2025-0052-NAC July 11, 2025 Page 8 of 24
Shares.”41 Benjamin asked if there was any law to support that position, and
Defendant’s counsel stated that “he did not know.”42
The next item on the agenda was electing Jack, Benjamin, and Eliott to
Iridium’s board of directors.43 Benjamin, on behalf of the Trusts, and Eliott, on behalf
of Pouran, voted for the slate.44 Jack, through counsel, voted against the slate.45 The
slate received majority approval, with 600 out of 1000 shares voted in favor of the
slate.46
E. The December 16 Board Meeting
On December 11, 2024, Benjamin sent a notice and agenda for a special
meeting of Iridium’s directors to be held via Zoom on December 16, 2024 to Iridium’s
directors, including Jack.47 The agenda for the meeting included the election of
Company officers.48 On the day the meeting was supposed to be held, Defendant’s
counsel emailed Plaintiffs’ counsel stating: “[a]s you know from our meeting last
41 Id. at 2.
42 Id.
43 Id.
44 Id.
45 Id.
46 See id. at 1–2.
47 Pre-Trial Stip. ¶ 52; see also JX 25.
48 JX 25 at 2. C.A. No. 2025-0052-NAC July 11, 2025 Page 9 of 24
Monday, Ben’s notice of a special Board meeting for later today is of no force and
effect as Ben is not a director and therefore has no power to call such a meeting.”49
The December 16 board meeting was attended by Benjamin and Eliott.50 Jack
did not attend.51 At the meeting Benjamin and Eliott elected Eliott as the Chief
Financial Officer of the Company and Benjamin as the Company’s Corporate
Secretary.52 They also elected Benjamin as the Chairman of the Board and discussed
other agenda items.53 Finally, Benjamin and Eliott as directors passed several
resolutions, including a resolution directing the Company to create a 2025 budget and
a resolution directing the Company to issue a cash dividend to its stockholders to
cover each stockholder’s tax obligation resulting from the Company’s S corporation
status for 2022 and, if applicable, 2023.54
F. The December 11 Dividend
On January 7, 2025, Defendant’s counsel sent a letter to the beneficiaries of
the Trusts’ informing them that on December 11, 2024, the Company had purported
to issue a pro rata distribution to Iridium’s stockholders totaling $6,750,000 (the
49 Pre-Trial Stip.¶ 53; see also JX 26.
50 JX 27 at 2.
51 Id.
52 Id.
53 See id. at 3–4.
54 Id. C.A. No. 2025-0052-NAC July 11, 2025 Page 10 of 24
“December 11 Dividend”).55 Checks to Pouran Nazarian and the Trusts were
enclosed.56
The December 11 Dividend represented nearly all of the Company’s available
cash; the parties disagree, however, on exactly how much money the Company would
have retained had all the dividend checks been cashed.57 Defendant asserts that if
the checks were cashed, the Company would still have “north of a million dollars” in
the bank.58 But JX 49 (the Company’s January 2025 bank statement) suggests that,
had Pouran Nazarian and the Trusts cashed their dividend checks when they
55 Pre-Trial Stip. ¶ 54 (“On January 7, 2025, Defendant’s counsel, Jay W. Freiberg, Esq., sent
a letter to Mark Elliott, Esq., New York counsel to Plaintiff Eliott Sassouni, his two brothers, and their mother, purporting to issue a pro rata distribution to Iridium stockholders totaling $6,750,000, and enclosing checks to Pouran Nazarian, the Article Fifth Trusts, and the Marital Trust.”); see also JX 30 at 1.
56 Pre-Trial Stip. ¶ 54; see also JX 30 at 1.
57 Compare Dkt. 53, Pls.’ Pre-Trial Answering Br. (“Pls.’ AB”) at 17 (“Had the Trusts and
Pouran deposited their checks in January 2025 when Defendant sent them, Iridium would have been left with just $530,000 by the end of the month.”) with Dkt. 50, Def.’s Pre-Trial Opening Br. (“Def.’s OB.”) at 20 (“[The dividend] did absolutely nothing at all to impair, much less jeopardize, Iridium’s financial well-being—notwithstanding Plaintiffs’ allusions in this proceeding to the contrary. As company bank statements . . . make clear, plenty of cash remained and still remains.”).
58 Dkt. 65, Trial Tr. (“TT”) 57:8–11 (“And regarding the dividend, first of all, it did not leave
the company penniless. It still left the company north of a million dollars in the bank.”); see also Def.’s OB at 20. C.A. No. 2025-0052-NAC July 11, 2025 Page 11 of 24
received them in January, the Company would have been left with a bank balance
that was substantially less.59
Plaintiffs’ counsel responded with a letter objecting to the dividend, stating
that Pouran Nazarian and the Trusts would not deposit their dividend checks, and
demanding that Defendant likewise not deposit his check.60 The letter also enclosed
a notice and agenda for a meeting of Iridium’s board of directors set for January 13,
2025 to consider a resolution declaring the December 11 Dividend unauthorized and
void.61
G. The January 13 Board Meeting
On January 13, 2025, Iridium’s board held a videoconference meeting.62
Benjamin and Eliott attended the meeting.63 Jack did not attend.64 Benjamin and
Eliott voted on and passed a resolution declaring the December 11 Dividend
59 See JX 30 (indicating distributions to the Trusts and Pouran Nazarian total $4,050,000.00);
JX 49 (providing that the Company’s end of January 2025 bank balance was $4,580,206.61); see also Pls.’ AB at 17.
60 Pre-Trial Stip. ¶ 55; see also JX 31.
61 Pre-Trial Stip. ¶ 55; see also JX 31. Defendant attempts to rationalize his actions to cause the Company to send out checks for the bulk of its cash days after the new board’s election, by pointing out that his many prior years of refusing to issue dividends had been a focus of the Surrogate’s Court’s proceedings. See TT 57:19–58:2; see also Def.’s OB at 20. But Plaintiffs respond that, with the election of the new board, it was no longer Defendant’s unilateral decision to make. See Dkt. 49, Pls.’ Opening Pre-Trial Br. (“Pls.’ OB”) at 46–47.
62 JX 32.
63 Id. at 3.
64 Id. C.A. No. 2025-0052-NAC July 11, 2025 Page 12 of 24
unauthorized and void and directing the Company to stop payment on the related
checks.65 Defendant deposited the check representing his pro rata share of the
December 11 Dividend.66
H. Procedural History
Plaintiffs commenced this action on January 16, 2025.67 After I entered a
scheduling order providing that “the court expects the parties to confer about a
schedule for this matter in the first instance,”68 Defendant did not meet and confer
with Plaintiffs to discuss scheduling and the entry of a status quo order.69 So
Plaintiffs filed a Motion for Status Conference and Entry of Status Quo Order.70 After
a hearing on Plaintiffs’ motion, Defendant stipulated to a status quo order.71
65 Id.
66 Pre-Trial Stip. ¶ 56; see also JX 34.
67 Dkt. 1, Verified Compl. Pursuant to 8 Del. C. § 225 and for Declaratory Relief.
68 Dkt. 4, Scheduling Letter.
69 See Dkt. 9, Pls.’ Mot. for Status Conference and Entry of Status Quo Order (“Pls.’ Mot. for
SQO”) Ex. 1.
70 Pls.’ Mot. for SQO.
71 Dkt. 19, Stipulated Status Quo Order. Notably, the status quo order contains a provision requiring Defendant to provide Plaintiffs with “view-only” access to Iridium’s bank accounts. It turns out that Defendant could never comply with this provision but did not confirm that until after agreeing to the status quo order. See JX 34 (indicating that, after the status quo order was entered, a representative of Iridium’s bank confirmed that view-only online access was not possible). C.A. No. 2025-0052-NAC July 11, 2025 Page 13 of 24
When Defendant failed to answer the complaint and, instead, moved to dismiss
after the deadline had passed, Plaintiffs filed a Motion for Entry of a Scheduling
Order.72 I heard oral argument on the motion and deferred consideration of
Defendant’s Motion to Dismiss or Stay until trial.73 The parties then stipulated to a
case schedule.74 I held a trial on a paper record in this matter on May 28, 2025.
II. ANALYSIS
Section 225(a) of the Delaware General Corporation Law provides that “[u]pon
application of any stockholder or director . . . the Court of Chancery may hear and
determine the validity of any election, appointment, removal or resignation of any
director or officer of any corporation . . . .”75 “A Section 225 action is a form of in rem
proceeding ‘where the defendants are before the court not individually, but rather, as
respondents being invited to litigate their claims to the res . . . or forever be barred
from doing so.’”76 In this way, Section 225 actions “provide a quick method for review
of the corporate election process to prevent a Delaware corporation from being
72 Dkt. 28, Pls.’ Mot. for Entry of Scheduling Order.
73 Dkt. 43, Tr. Telephonic Oral Argument and Rulings of the Court on Pls.’ Mot. for Entry of
Scheduling Order 30:9–18.
74 See Dkt. 40, Stipulation and Order Governing Case Scheduling.
75 8 Del. C. § 225(a).
76 Hockessin Cmty. Ctr., Inc. v. Swift, 59 A.3d 437, 453 (Del. Ch. 2012) (quoting Genger v. TR
Investors, LLC, 26 A.3d 180, 199–200 (Del. 2011)). C.A. No. 2025-0052-NAC July 11, 2025 Page 14 of 24
immobilized by controversies about whether a given officer or director is properly
holding office.”77
Section 225(b) of the DGCL also allows the Court of Chancery to “hear and
determine the result of any vote of stockholders upon matters other than the election
of directors or officers.”78 In this Section 225 proceeding, Plaintiffs bear the burden
of proving by a preponderance of the evidence that they are entitled to relief.79
A. Benjamin Nazarian Had the Power to Vote the Trusts’ Shares
The composition of Iridium’s board turns on whether Benjamin Nazarian had
the power to vote the Trusts’ shares at the December 9 stockholders’ meeting. The
answer is: he did.
The letters of trusteeship issued by the New York Surrogate’s Court
empowered Benjamin to act as co-trustee of the Marital Trust and the Article Fifth
Trusts.80 Under New York law, “letters granted by the court are conclusive evidence
of authority of the persons to whom they are granted until the decree granting them
is reversed or modified upon appeal or the letters are suspended, modified or revoked
77 Box v. Box, 697 A.2d 395, 398 (Del. 1997) (citing Bossier v. Connell, 1986 WL 11534, at *2
(Del. Ch. Oct. 7, 1986)).
78 8 Del. C. § 225(b).
79 See In re IAC/InterActive Corp., 948 A.2d 471, 493 (Del. Ch. 2008).
80 See JX 8 (successor letters of trusteeship appointing Benjamin co-trustee of the Marital
Trust); JX 11 (temporary letters of trusteeship appointing Benjamin co-trustee of the Article Fifth Trusts). C.A. No. 2025-0052-NAC July 11, 2025 Page 15 of 24
by the court granting them.”81 Such letters of trusteeship may “contain appropriate
recitals restraining the holder from doing such acts or exercising any such powers as
may be specified therein until the further order of the court . . .”82
The letters of trusteeship appointing Benjamin as trustee of the Marital Trust
and the Article Fifth Trusts have not been reversed, suspended, modified, or revoked.
Accordingly, Benjamin, as co-trustee of the Trusts, was empowered to vote the Trusts’
shares at the December 9 stockholders’ meeting. And, as Plaintiffs well explain, the
plain language of these letters “impose[d] no limitation on the authority conferred on
Mr. Nazarian.”83 Thus, a majority of the Company’s shares were voted in favor of
amending the bylaws, and electing Jack, Benjamin, and Eliott to Iridium’s board of
directors. Later, Benjamin and Eliott, as directors, voted to elect Eliott as Chief
Financial Officer and Benjamin as Corporate Secretary and Chairman of the Board.84
B. Defendant’s Motion to Dismiss or Stay Is Denied
Despite all this, Defendant has moved to dismiss or stay the Section 225
proceeding. First, Defendant asserts that this action should be dismissed because
the letters of trusteeship are not entitled to full faith and credit in Delaware. Second,
81 N.Y. Surr. Ct. Proc. Act § 703 (McKinney 2025).
82 Id. § 702.
83 Pls.’ AB at 27.
84 As discussed below, Defendant does not present an argument as to the election of officers
at the December 16 board meeting beyond his general arguments that this action should be dismissed or stayed pending the resolution of the New York litigation. C.A. No. 2025-0052-NAC July 11, 2025 Page 16 of 24
Defendant argues that this action should at a minimum be stayed until all appeals
in New York are complete, which Defendant acknowledges could take years.85
a. Full Faith and Credit Does Not Require Dismissal
Defendant argues that the letters of trusteeship are not entitled to full faith
and credit because they “are the result of interim, non-final rulings of a New York
trial court,” and Defendant has appealed the Surrogate’s Court’s rulings.86 But the
pending appeals do not mean that the letters lacked legal effect on December 9, 2024,
or lack legal effect now. Because they have not been reversed, suspended, modified,
or revoked, the letters of trusteeship are, per New York statute, “conclusive evidence”
of Benjamin’s authority as a co-trustee.
Defendant largely ignores and otherwise fails to grapple with these issues, and
his argument can hardly be said to be well-developed. If anything, dismissing this
action would suggest that, contrary to New York law, the letters of trusteeship did
not empower Benjamin to act with actual effect. Such a result seems plainly contrary
to the intent of not only the New York Surrogate’s Court but also the New York state
legislature. Indeed, the relevant New York statute provides that the Surrogate’s
Court may limit the temporary trustee’s power if limitations or conditions appear in
85 See e.g., TT 71:24–73:20.
86 Dkt. 54, Def.’s Answering Br. at 2. C.A. No. 2025-0052-NAC July 11, 2025 Page 17 of 24
the letter.87 Because the letters of trusteeship contain no such limitations or
conditions, Benjamin’s power to vote the Trusts’ shares is precisely the outcome
intended by New York law. And Defendant does not put forward any precedent
suggesting otherwise. So, framed in light of the relevant question here—namely, did
Benjamin have the power to vote on the date of the stockholders meeting—the answer
is yes.
Accepting Defendant’s argument would, from a practical perspective, suggest
either that the Trusts have no trustee empowered to act in such capacity or that
Defendant—whom the New York Surrogate’s Court removed as trustee for fiduciary
duty breaches—in effect remains co-trustee of the Trusts. Besides being inconsistent
with New York law, neither outcome is consistent with Defendant’s representations
before the December 9 stockholders’ meeting and during the pendency of this
litigation. In the lead up to the stockholders’ meeting, Defendant represented
through his counsel that Benjamin, “as the current trustee” would have the right to
vote the Trusts’ shares—at least “for the limited purpose of the December 9
meeting.”88 And during this litigation, Defendant’s counsel has continued to
87 See N.Y. Surr. Ct. Proc. Act § 702 (McKinney 2025).
88 JX 18 at 8. C.A. No. 2025-0052-NAC July 11, 2025 Page 18 of 24
represent that Benjamin had the power to vote the Trusts’ shares at the December 9
stockholders’ meeting and has the power to vote the Trusts’ shares today.89
In short, Defendant fails to support meaningfully why his full faith and credit
argument requires dismissal. For the reasons explained, Defendant’s motion to
dismiss is denied.
b. A Stay Is Not Warranted
Defendant also argues that this action should be stayed pending the resolution
of the New York litigation. In support of his argument, Defendant relies primarily
on this Court’s decision in Carvel v. Andreas Holdings., Corp.90 But as Plaintiffs ably
explain, Carvel is materially distinguishable.91
As the Court described in Carvel, in a “minority of cases” a stay “would not
undermine or defeat the statutory purposes” of a Section 225 proceeding.92 This case
does not fall within that minority.93 Instead, this is precisely the kind of case where
89 TT 31:12–32:1.
90 689 A.3d 375 (Del. Ch. 1995).
91 See Pls.’ OB at 39–41.
92 Carvel, 689 A.3d at 378.
93 Although in Carvel there was a dispute over who owned the underlying shares, there is no
such dispute here. 689 A.3d at 378–78. The parties both agree that the Trusts own the shares. And, in Carvel, the parties expected an expedited answer from the foreign court to the question on which the stay of the Delaware proceeding turned. Id. at 376–78. But here, as explained above, even Defendant acknowledges that resolution of any appeals may take years, during which time Defendant would have this summary Section 225 proceeding stayed. C.A. No. 2025-0052-NAC July 11, 2025 Page 19 of 24
“prompt resolution of the corporate governance dispute [is] needed.”94 If Defendant’s
appeals are granted and he is reinstated as co-trustee, he will be able to vote the
Trusts’ shares from that point. But his reinstatement as co-trustee will not undo
Benjamin’s ability to vote the Trusts’ shares as of the December 9 stockholders’
meeting. A stay of this proceeding pending the outcome of the New York litigation
would needlessly paralyze the Company and run counter to the statutory purposes of
Section 225.
C. Plaintiffs Are Entitled to Judgment on Counts I, II, & III
As already discussed, Section 225(a) allows a stockholder or director to seek a
determination as to the validity of any election, appointment, removal, or resignation
of any director or officer.95 Section 225(b) permits a stockholder or the corporation to
seek a determination regarding a stockholder vote.96
In Count I, Plaintiffs seek a declaration that the December 9 stockholder vote
for Iridium’s Amended and Restated Bylaws was valid and that the bylaws became
effective as of the time of the vote.
In Count II, Plaintiffs seek a declaration that the December 9 stockholder vote
electing Jack, Benjamin, and Eliott to Iridium’s board of directors was valid and
94 Id. at 378.
95 8 Del. C. § 225(a).
96 Id. § 225(b). C.A. No. 2025-0052-NAC July 11, 2025 Page 20 of 24
immediately effective and that Iridium’s board of directors consists of Jack,
Benjamin, and Eliott.
In Count III, Plaintiffs seek a declaration that the December 16 board meeting
was properly noticed, and the resolutions passed at the meeting are valid and
effective. Those resolutions include a resolution electing Benjamin as the Company’s
Corporate Secretary and Chairman of the Board and Eliott as the Company’s CFO.97
Defendant did not put forth any arguments that the meeting was improperly noticed
or otherwise invalid.98 Indeed, Defendant stipulated that Benjamin sent notice of the
December 16 meeting to him,99 and directed all of his trial arguments toward
obtaining a dismissal or stay of this action.
The relief that Plaintiffs seek in Counts I, II, and III relates to the
determination of a stockholder vote and the election of the Company’s directors and
officers. As already discussed at length, Benjamin was entitled to vote the Trusts’
shares once the Surrogate’s Court issued the letters of trusteeship. So the December
97 See JX 27 at 2.
98 See Emerald P’rs v. Berlin, 726 A.3d 1215, 1224 (Del. 1999) (“Issues not briefed are deemed
waived.” (citation omitted)).
99 See Pre-Trial Stip. ¶ 52 (“On December 11, 2024, Mr. Nazarian sent a notice and agenda
for a special meeting of the board of directors of Iridium, to be held on December 16, 2024, via Zoom, along with an information request directed to the Company . . . .”); see also JX 25 (email from Benjamin to Jack attaching a notice of the December 16 board meeting); JX 26 (email from Defendant’s counsel to Plaintiffs’ counsel responding to the notice). C.A. No. 2025-0052-NAC July 11, 2025 Page 21 of 24
9 stockholder vote in favor of Iridium’s Amended and Restated Bylaws was valid and
the bylaws became effective at that time. The December 9 stockholder vote electing
Jack, Benjamin, and Eliott to Iridium’s board of directors was likewise valid and
effective. Jack, Benjamin, and Eliott comprised, and continue to comprise, Iridium’s
board of directors. And the December 16 board of directors meeting was properly
noticed and the resolutions passed at the meeting electing officers were also valid and
effective. Accordingly, Plaintiffs are entitled to judgment on Counts I, II, and III, as
described above.
D. Count IV and Plaintiffs’ Request for Attorneys’ Fees Are Outside the Scope of this Decision
In a Section 225 proceeding “[t]he Court exercises jurisdiction ‘only for the
limited purpose of determining the corporation’s de jure directors and officers.’”100 In
other words, “the scope of a Section 225 action is narrow and is ‘limited to determining
those issues that pertain to the validity of actions to elect or remove a director or
officer’”101 or the results of a stockholder vote under Section 225(b).102 So a Section
225 action is an improper vehicle for trying purely collateral issues, issues of director
100 Hockessin Cmty. Ctr., 59 A.3d at 453 (quoting Genger, 26 A.3d at 200).
101 Chordia v. Lee, 2024 WL 49850, at *17 (Del. Ch. Jan. 4, 2024) (quoting Genger, 26 A.3d at
199).
102 8 Del. C. § 225(b). C.A. No. 2025-0052-NAC July 11, 2025 Page 22 of 24
misconduct or other breaches of fiduciary duty.103 A claim is “purely collateral” if
resolution of the claim does not help the Court decide the proper composition of the
board of directors or management team or the validity of a stockholder vote.104
In Count IV, Plaintiffs seek a declaration that:
(i) The January 13, 2025 special meeting of the board of directors was validly noticed; (ii) The December 11 Dividend was unauthorized and issued without board approval; and (iii) The resolution declaring the December 11 Dividend void passed at the January 13, 2025 special meeting of the board of directors and is valid and effective; and (iv) An order directing to Defendant to disgorge the $2,700,000 if Iridium assets he misappropriated in connection with the December 11 Dividend.
Count IV is purely collateral because resolution of the claim asserted does not bear
on either the proper composition of Iridium’s board of directors or management team
or the validity of a stockholder vote. So the relief sought in Count IV falls outside the
parameters of Section 225.
103 See Box v. Box, 697 A.2d 395 (Del. 1997) (“To preserve an expedited remedy, a proceeding
brought pursuant to section 225 is a summary proceeding, and the Court of Chancery has consistently limited section 225 trials to narrow issues. Thus, a section 225 action is not to be used for trying purely collateral issues, issues of director misconduct or other breaches of duty.”).
104 See Genger, 26 A.3d at 199 (“In determining what claims are cognizable in a Section 225
action, the most important question that must be answered is whether the claims, if meritorious, would help the court decide the proper composition of the corporation’s board or management team. If not, then those claims are said to be collateral to the purpose of a Section 225 action and must be raised in a separate plenary action.” (citation modified)). C.A. No. 2025-0052-NAC July 11, 2025 Page 23 of 24
Although a declaration that, since December 9, 2024, Iridium’s board of
directors consists of Jack, Benjamin, and Eliott sheds ample light on how this Court
might ultimately rule on the allegations contained in Count IV, for present purposes,
this count falls outside the scope of this narrow proceeding.
Plaintiffs also seek an award of attorneys’ fees on account of Defendant’s
“egregious prelitigation conduct and bad faith defense of this litigation.”105 Plaintiffs
may well be entitled to attorneys’ fees, but because the relief sought does not bear on
the specific question at hand—namely, the composition of Iridium’s board and
management team—I decline to address Plaintiffs’ fee request in this post-trial
decision. The Court will address Plaintiffs’ request following a separate hearing and
in a separate ruling.
In sum, this letter decision does not address Count IV of the complaint or
Plaintiffs’ request for attorneys’ fees. The parties are encouraged to meet and confer
to resolve Count IV, the attorneys’ fee request, and any other outstanding issues.
III. CONCLUSION
Plaintiffs have proved that Jack Sassouni, Benjamin Nazarian, and Eliott
Sassouni are the lawful members of Iridium’s board of directors. Plaintiffs are
entitled to judgment on Counts I, II, and III. This decision does not address the
claims asserted in Count IV or Plaintiffs’ request for attorneys’ fees. The parties are
105 Pls.’ OB at 49. C.A. No. 2025-0052-NAC July 11, 2025 Page 24 of 24
asked to submit a stipulated form of order implementing this decision within five
business days.
Sincerely,
/s/ Nathan A. Cook
Vice Chancellor
NAC/sb
cc: All Counsel of Record, via File and ServeXpress