Vladimir Fishel v. Liberty Media Corporation

Opinion

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

VLADIMIR FISHEL, ) KAPITALFORENINGEN ) SAMPENSION INVEST, ) GLOBALT AKTIEINDEKS and ) KAPITALFORENINGEN ) SAMPENSION INVEST, ) GLOBALT AKTIEINDEKS ) ENHANCED, ) ) Plaintiffs, ) ) v. ) C.A. No. 2024-1057-KSJM ) LIBERTY MEDIA CORPORATION, ) JOHN C. MALONE, GREGORY B. ) MAFFEI, EDDY W. ) HARTENSTEIN, JAMES P. ) HOLDEN, DAVID A. BLAU, ROBIN ) P. HICKENLOOPER, JENNIFER ) WITZ, EVAN MALONE, JAMES ) MEYER, JONELLE PROCOPE, ) MICHAEL RAPINO, KRISTINA ) SALEN, CARL E. VOGEL, and ) DAVID ZASLAV, ) ) Defendants. )

ORDER DENYING APPLICATION TO CERTIFY INTERLOCUTORY APPEAL

1. Plaintiffs challenge the September 2024 spin-off of SiriusXM Holdings

Inc. by its controller, Liberty Media Corporation.1 Before the spin-off, the board

formed a special committee to address the controller’s conflict. The committee

1 Terms not defined in this Order have the same meaning as in Fishel v. Liberty Media

Corp., 2026 WL 982224 (Del. Ch. Apr. 13, 2026) [“Opinion”]. recommended the spin-off, which the board then approved. The deal created a new

independent company with no controller and eliminated Liberty’s tracking stock.

Before the spin-off, the tracking stock traded below the value of its underlying assets.

Eliminating the tracking stock removed that discount, which created an allegedly

multi-billion-dollar benefit for Liberty alone.

2. Plaintiffs asserted claims challenging the spin-off on behalf of a class of

minority stockholders. Defendants fall into three categories: the Liberty Defendants,

the Committee Defendants, and the Non-Committee Defendants. The Committee

Defendants and Non-Committee Defendants moved to dismiss the Complaint under

In re Cornerstone Therapeutics Inc., Stockholder Litigation.2 The Liberty Defendants

did not move to dismiss the Complaint. In a Memorandum Opinion dated April 13,

2026 (the “Opinion”), the court granted the Committee Defendants’ motion but denied

the Non-Committee Defendants’ motion.

3. The Non-Committee Defendants applied for certification of an

interlocutory appeal of the Opinion (the “Application”).3 Supreme Court Rule 42

permits certification of interlocutory appeal when “the order of the trial court decides

a substantial issue of material importance that merits appellate review before a final

judgment.”4 If the “substantial issue” requirement is met, this court will then analyze

eight factors to determine whether “there are substantial benefits that will outweigh

2 115 A.3d 1173, 1180 (Del. 2015).

3 C.A. No. 2024-1057-KSJM, Docket (“Dkt.”) 91 (“Application”).

4 Supr. Ct. R. 42(b)(i).

2 the certain costs that accompany an interlocutory appeal.”5 Rule 42 cautions that

“[i]nterlocutory appeals should be exceptional, not routine, because they disrupt the

normal procession of litigation, cause delay, and can threaten to exhaust scarce party

and judicial resources.”6 This language of Rule 42 serves as an interpretive principle,

requiring that the court interpret the factors such that interlocutory appeals are

exceptional, not routine.7

Substantial Issue

4. “The ‘substantial issue’ requirement is met when an interlocutory order

decides a main question of law which relates to the merits of the case[.]”8 The Opinion

decided a substantial issue because it resolved a Rule 12(b)(6) motion, which is a

merits-based motion and is substantial in that way.9

Multi-Factor Analysis

5. Because the substantial-issue requirement is satisfied, the discussion

turns to a multi-factor analysis of whether a substantial benefit outweighs the costs

5 Id. R. 42(b)(ii), (iii)(A)–(H).

6 Id. R. 42(b)(ii).

7 Id. R. 42(b)(iii) (stating that “[i]f the balance is uncertain, the trial court should

refuse to certify the interlocutory appeal”); see also Donald J. Wolfe, Jr. & Michael A. Pittenger, Corporate and Commercial Practice in the Delaware Court of Chancery § 18.04[c] (2d ed. 2024). 8 Riskin v. Burns, 2021 WL 303999, at *1 (Del. Ch. Jan. 29, 2021) (quoting Sprint

Nextel Corp. v. iPCS, Inc., 2008 WL 2861717, at *1 (Del. Ch. July 22, 2008)). 9 Id.

3 of an interlocutory appeal.10 Rule 42 identifies eight factors to consider when

conducting this balancing analysis.11

6. The Non-Committee Defendants rely on two of the Rule 42 factors—

Factors (B) and (H). By failing to advance arguments under the other six factors, the

Non-Committee Defendants concede that those factors do not weigh in favor of

certifying interlocutory appeal.

7. Factor (B) asks whether “[t]he decisions of the trial courts are

conflicting upon the question of law[.]”12 The Non-Committee Defendants argue that

decisions of this court conflict on one issue: Cornerstone requires that, to state a non-

exculpated claim against directors who lack independence from an interested person,

a plaintiff must plead that the director “acted to advance the self-interest of an

interested party.”13 The Opinion refers to this as the “action element” of

Cornerstone.14 Is alleging that a director voted in favor of the challenged transaction

sufficient to satisfy Cornerstone’s action element?15 The Non-Committee Defendants

argue that six decisions of this court are split into two groups on this issue.16

8. Three decisions of this court answer the question in the affirmative: the

Opinion, Firefighters’ Pension System of City of Kansas City v. Foundation Building

10 See Supr. Ct. R. 42(b)(ii), (iii)(A)–(H).

11 Id. R. 42(b)(iii)(A)–(H).

12 Id. R. 42(b)(iii)(B).

13 Cornerstone, 115 A.3d at 1180.

14 Opinion at *8.

15 Application ¶ 4.

16 Id. ¶¶ 17–25.

4 Materials, Inc.,17 and the pleading-stage decision in In re BGC Partners, Inc.

Derivative Litigation (“BGC I”).18

9. The Opinion concluded that a director vote in favor of a transaction

“unquestionably advances the transaction” and thus satisfies the action element at

the pleading stage.19 Both Foundation Building Materials and BGC I take the

commonsense approach of the Opinion. In Foundation Building Materials, the court

held that “[a]ll that a claim for breach of fiduciary duty requires is a showing that the

conflicted fiduciaries voted in favor of the interested transaction.”20 Similarly, in

BGC I, the court held that “by voting to approve the Transaction, [the director

defendants] acted to advance the self-interest of an interested party who stood on

both sides of the Transaction[.]”21

10. This approach is consistent with Delaware’s board-centric model. The

Delaware General Corporation Law (the “DGCL”) vests corporate decision-making

authority in the board of directors.22 Majority votes bind the board and thus the

corporation they manage.23 Under the DGCL, directors’ votes can determine myriad

17 318 A.3d 1105 (Del. Ch. 2024).

18 2019 WL 4745121 (Del. Ch. Sep. 30, 2019) [“BGC I”].

19 Opinion at *8.

20 Found. Bldg. Mat’ls, 318 A.3d at 1163.

21 BGC I, 2019 WL 4745121, at *14.

22 See 8 Del. C. § 141(a); see also In re Numoda Corp. S’holders Litig., 2015 WL

402265, at *9 (Del. Ch. Jan. 30, 2015), aff’d sub nom., In re Numoda Corp., 128 A.3d 991 (Del. 2015) (“Corporate acts are driven by board meetings, at which directors make formal decisions.”). 23 See 8 Del. C. §§ 141(a), (b).

5 corporate actions including the issuance of dividends,24 the formation of committees,25

and amendments to bylaws.26 For decisions such as charter amendments,27

mergers,28 and dissolution,29 the DGCL requires board action in addition to

stockholder votes. Board votes thus carry significant weight under the DGCL.

11. For this reason, Delaware law encourages conflicted directors to abstain

from board processes—including the ultimate board vote—to avoid liability. In

Weinberger v. UOP, Inc., the Supreme Court expressly “command[ed] . . . that

directors who have a conflict of interest relating to a proposed transaction should

totally abstain from participating in the board’s consideration of that transaction.”30

Consistent with the DGCL and Supreme Court precedent, the Opinion reasoned that

“[v]oting in favor of a transaction unquestionably advances the transaction” because

it is often “the ultimate action needed to complete the transaction.”31 Effectively, the

Non-Committee Defendants ask the court to treat, for Cornerstone purposes, a vote

in favor of a transaction as a recusal. The Opinion rejected that argument.

24 Id. § 170(a).

25 Id. § 141(c)(2).

26 Id. § 109(a).

27 Id. § 242(b)(1).

28 Id. § 251.

29 Id. § 275(a).

30 In re Tri-Star Pictures, Inc. Litig., 1995 WL 106520, at *3 (Del. Ch. Mar. 9, 1995)

(citing Weinberger v. UOP, Inc., 457 A.2d 701, 711 (Del. 1983)). 31 Opinion at *8.

6 12. According to the Non-Committee Defendants, three decisions go the

other way: Klein v. H.I.G. Capital, L.L.C.,32 Atallah v. Malone,33 and the summary

judgment decision in In re BGC Partners, Inc. Derivative Litigation (“BGC II”).34 In

Klein, plaintiffs asserted that the CEO advanced the controller’s interest by

approving three transactions.35 The court rejected this theory stating that, “[t]he

contention is theoretically plausible given that [the CEO] . . . may have been

motivated to curry favor with [the controller] to maintain his position as CEO, but

there simply are no facts alleged . . . that indicate that [the CEO] advanced [the

controller’s] self-interest as plaintiff theorizes.”36 Atallah follows the approach of

Klein, but the court in Atallah did not grapple with the effect of the director’s vote on

Cornerstone’s action element. In BGC II, the court focused on the lack of

individualized allegations against the director after reviewing a full record on

summary judgment.37 But BGC II was not a pleading-stage decision and thus does

not inform Cornerstone’s pleading-stage requirement. As noted in the Opinion, Klein

and Atallah provide “soft support” for the Non-Committee Defendants’ position, but

no more.38

32 2018 WL 6719717 (Del. Ch. Dec. 19, 2018).

33 2023 WL 4628774 (Del. Ch. July 19, 2023).

34 2021 WL 4271788 (Del. Ch. Sep. 20, 2021) [“BGC II”].

35 Klein, 2018 WL 6719717, at *18.

36 Id.

37 BGC II, 2021 WL 4271788, at *10 (“There is nothing implicating [the director]

individually.”). 38 Opinion at *10.

7 13. Still, the Non-Committee Defendants are correct to say that there is

divergence among trial court decisions on what a plaintiff must plead to satisfy the

action element of Cornerstone. Thus, Factor (B) supports granting the Application.

14. Factor (H) asks whether “[r]eview of the interlocutory order may serve

considerations of justice.”39 For this point, the Non-Committee Defendants argue

that high court intervention could save the seven Defendants the time and expense

of further litigation. But that logic is faulty given the circumstances of this action.

The claims against the Liberty Defendants will move forward. All Defendants are

thus likely to remain involved in this action for discovery purposes, regardless of the

outcome on interlocutory appeal. And although Plaintiffs filed the Complaint nearly

eighteen months ago, no meaningful discovery has begun. To avoid inefficiencies

resulting from piecemeal litigation pending interlocutory appeal, the court would

have to stay the underlying litigation. That would delay resolution and prejudice

Plaintiffs. Plus, the appeal itself will be costly.

15. So, is a single Rule 42 factor—the split in authority identified by the

Non-Committee Defendants—enough to warrant granting the Application? To

answer this question, the court resorts to Rule 42’s interpretive principle:

Interlocutory appeals are exceptional. They disrupt the normal procession of

litigation, threaten a piecemeal approach to suits, cause delay, and threaten to

exhaust party and judicial resources. Those risks, which are always presented by an

interlocutory appeal, are conspicuous here given that the claims will move forward

39 Supr. Ct. R. 42(b)(iii)(H).

8 against the Liberty Defendants regardless. These downsides outweigh any benefit to

resolving the differences in trial court decisions identified by the Non-Committee

Defendants. The Application is denied.

/s/ Kathaleen St. J. McCormick Chancellor Kathaleen St. J. McCormick May 11, 2026