IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

IN RE BGC PARTNERS, INC. 

DERIVATIVE LITIGATION

)

)

CONSOLIDATED

C.A. No. 2018-0722-LWW

MEMORANDUM OPINION

Date Submitted: June 22, 2021

Date Decided: September 20, 2021

Christine M. Mackintosh, Kimberly A. Evans, Michael D. Bell, and Vivek Upadhya, 

GRANT & EISENHOFER P.A., Wilmington, Delaware; Jeroen van Kwawegen, 

Christopher J. Orrico, and Andrew E. Blumberg, BERNSTEIN LITOWITZ 

BERGER & GROSSMANN LLP, New York, New York; Counsel for Plaintiffs 

Roofers Local 149 Pension Fund and Northern California Pipe Trades Trust Funds

Raymond J. DiCamillo and Kevin M. Gallagher, RICHARDS, LAYTON & 

FINGER, P.A., Wilmington, Delaware; Joseph De Simone, Michelle J. Annunziata, 

and Michael Rayfield, MAYER BROWN LLP, New York, New York; Matthew E. 

Fenn, MAYER BROWN LLP, Chicago, Illinois; Counsel for Defendants Linda Bell, 

Stephen Curwood, and William Moran

C. Barr Flinn, Paul Loughman, and Alberto E. Chávez, YOUNG CONAWAY 

STARGATT & TAYLOR, LLP, Wilmington, Delaware; Eric Leon and Nathan 

Taylor, LATHAM & WATKINS LLP, New York, New York; Counsel for 

Defendants Howard Lutnick, CF Group Management, Inc., and Cantor Fitzgerald,

L.P.

WILL, Vice Chancellor
1

This derivative action arises from the 2017 acquisition of Berkeley Point 

Financial LLC by BGC Partners, Inc. BGC paid $875 million to purchase Berkeley 

Point from Cantor Commercial Real Estate Company, L.P. (“CCRE”) and 

simultaneously invested $100 million into CCRE’s commercial mortgage-backed 

securities business. Defendant Howard Lutnick, BGC’s Chairman and CEO, was 

the controlling stockholder of both BGC and CCRE through his control of defendant 

Cantor Fitzgerald, L.P.

The plaintiffs claim that Lutnick, standing on both sides of the transaction,

caused BGC to overpay for Berkeley Point because his economic interest in 

Berkeley Point far exceeded his interest in BGC. They estimate that Lutnick

received 42% (or $125 million) of BGC’s overpayment. The plaintiffs assert breach 

of fiduciary duty claims against Lutnick as a director, controlling stockholder, and 

officer of BGC; against two Cantor entities that sat above BGC and Berkeley Point;

and against four outside BGC directors (one of whom was dropped from the case)

who approved the Berkley Point acquisition. 

The court previously denied the defendants’ motions to dismiss for failure to

plead demand futility and failure to state a claim against the outside directors. Now, 

after discovery, the defendants have filed separate motions for summary judgment. 

Lutnick and the two Cantor entities argue that there is no genuine issue of material 

fact as to the independence of the outside director defendants, requiring dismissal on 
2

demand futility grounds. If their motion is denied on that basis, they seek to shift 

the burden of persuasion at trial to the plaintiffs. The director defendants—members 

of the Special Committee who negotiated on BGC’s behalf—argue that they must 

be dismissed under Cornerstone because there is no evidence that they acted to 

advance the self-interests of Lutnick or acted in bad faith.

After a review of the record before me, I conclude that the Cantor defendants’ 

motion must be denied and the director defendants’ motion must be granted, in part. 

There is a genuine dispute about whether two of the three director defendants were 

independent of Lutnick. For one of those directors, there are genuine issues of 

material fact remaining as to whether he faces a non-exculpated claim. The evidence 

is not overwhelming. But that is not the standard. The plaintiffs are entitled to 

inferences favoring their position and have pointed to questions of fact that are best 

left for trial. For the two remaining director defendants, I conclude that no rational 

trier of fact could find both that they lack independence from Lutnick and that they 

acted to advance Lutnick’s interests. I also conclude that the burden of proving 

entire fairness at trial remains with the defendants. 
3

I. FACTUAL BACKGROUND

The following summary is drawn from the Complaint for uncontested 

background facts and from the factual record as appropriate.

1

 The defendants’ briefs 

each style their fact sections as a “Statement of Undisputed Material Facts.”2 The 

plaintiffs refute that title, calling the defendants’ descriptions of the facts 

“distorted.”

3

 The plaintiffs submitted a “Disputed Fact Chart,”

4

to which the 

defendants responded on reply.5 I therefore approach the notion of undisputed facts 

with caution. In considering the record, my focus is on information that bears on the 

director defendants’ relationships to Lutnick and their negotiation efforts as Special 

Committee members. 

1 Citations in the form “Dir. Defs.’ Opening Br. Ex. __” refer to exhibits to the Transmittal 

Declaration of Kevin M. Gallagher in Support of the Independent Director Defendants’ 

Opening Brief in Support of Their Motion for Summary Judgment (Dkt. 164). Citations in 

the form “Pls.’ Answering Br. Ex. __” refer to exhibits to the Unsworn Transmittal 

Affidavit of Christine M. Mackintosh in Support of Plaintiffs’ Omnibus Answering Brief 

(Dkt. 180). Citations in the form “Dir. Defs.’ Reply Br. Ex. __” refer to exhibits to the 

Transmittal Declaration of Kevin M. Gallagher in Support of the Independent Director 

Defendants’ Reply Brief in Support of Their Motion for Summary Judgment (Dkt. 195). 

Page numbers to exhibits are designated by the last four digits of a Bates number, where 

appropriate. 

2 Dir. Defs.’ Opening Br. 7 (Dkt. 163); Cantor Defs.’ Opening Br. 4 (Dkt. 172).

3 Pls.’ Answering Br. 8 (Dkt. 180). 

4

Id.; Pls.’ Answering Br. Ex. 2. 

5 Dir. Defs.’ Reply Br. Ex. 1. 
4

A. BGC and the Cantor Defendants

Nominal defendant BGC Partners, Inc. is a public Delaware corporation 

headquartered in New York that provides brokerage and financial services.6 

Defendant Cantor Fitzgerald, L.P., a Delaware limited partnership, is BGC’s parent 

company and controlling stockholder.7 Defendant CF Group Management, Inc. 

(“CFGM”), a New York corporation, is Cantor’s managing general partner.8 

Defendant Howard Lutnick is the Chairman and CEO of BGC.9 Lutnick is 

also the sole stockholder of CFGM, through which he has sole voting control of 

Cantor.10 Cantor, CFGM, and Lutnick controlled BGC at the time of the challenged 

transaction through their beneficial ownership of 100% of BGC’s Class B supervoting common stock.11

 For purposes of this decision, Cantor, CFGM, and Lutnick 

are referred to as the “Cantor Defendants.” Together, the Cantor Defendants hold 

approximately 60% of BGC’s total voting power.12

6 Am. Verified S’holder Deriv. Compl. ¶ 12 (Dkt. 25) (hereinafter “Am. Compl.”).

7

Id. ¶ 13. 

8

Id. ¶ 14.

9

Id. ¶ 18.

10 Id. ¶ 14.

11 Id. ¶ 15.

12 Id.
5

Berkeley Point, LLC is a designated underwriting and servicing lender for

multi-family and commercial mortgages.

13 Before the transaction, Berkeley Point 

was a wholly owned subsidiary of Cantor Commercial Real Estate Company, L.P., 

another Cantor affiliate.14 Cantor had a controlling interest in CCRE, meaning that 

Lutnick effectively controlled both BGC and Berkeley Point at the time of the 

transaction. His personal economic interests in BGC and Berkeley Point at that time

were 12.2% and 54.5%, respectively.15

B. The Special Committee

In February 2017, Lutnick informed BGC’s Audit Committee that BGC was 

considering acquiring Berkeley Point.16 The Audit Committee consisted of 

defendant Dr. Linda Bell, defendant Stephen Curwood, defendant William Moran, 

and Secretary John Dalton. Because both BGC and CCRE are affiliates of Cantor, 

the Audit Committee authorized its members to act as a Special Committee to 

evaluate and negotiate the transaction on BGC’s behalf.17 

13 Id. ¶ 17.

14 Id.

15 Pls.’ Answering Br. 13 nn.26-27.

16 See Dir. Defs.’ Opening Br. Ex. 29, at 1263. 

17 Id. at 1265.
6

On March 14, 2017 the Board formally established a fully empowered Special 

Committee of Bell, Curwood, Dalton, and Moran.18 Moran and Bell co-chaired the 

Special Committee.19 Lutnick supported (at a minimum) the selection of Moran as 

co-chair of the Special Committee.

20

 Lutnick had also “proposed that . . . Dr. Bell 

be named as the co-chair.”21 

Each of the four Special Committee members is an outside director who had 

been on BGC’s Board for at least four years at the time the Special Committee was 

formed. Each member is highly accomplished and respected in his or her respective 

field.22 For the directors central to this motion—Bell, Moran, and Curwood

(together, the “Director Defendants”)—I will briefly describe their background and 

ties to Lutnick.

1. Dr. Linda Bell

Bell is a professor of economics and has held senior roles at several 

prestigious universities. She joined BGC as a director in 2013.23 She had previously 

served on the board of ELX Futures L.P., another Cantor–controlled entity, from 

18 Dir. Defs.’ Opening Br. Ex. 30, at 1268. 

19 Pls.’ Answering Br. 3.

20 Pls.’ Answering Br. Ex. 1, at 171-73.

21 Pls.’ Answering Br. Ex. 70, at 4.

22 See Dir. Defs.’ Opening Br. 1-2.

23 Id. at 18.
7

2009 to 2013.24 Bell earned an average of $118,823 per year from her ELX and 

BGC board positions between 2010 to 2017.

25

 That compensation accounted for

7.6% of her total household income over that same period.26

Bell and Lutnick first met—briefly—when she was a junior faculty member 

at Haverford College, Lutnick’s alma mater.27 Lutnick is a long-time member of 

Haverford’s Board of Managers and has donated tens of millions of dollars to the 

college.28 Bell and Lutnick became better acquainted after Bell was appointed 

Provost of Haverford in 2007.29 Lutnick did not play a direct role in Bell’s 

appointment as Provost beyond voting to approve the promotion.

30

 In her position 

as Provost, Bell attended meetings of and presented to the Board of Managers 

(including Lutnick) three or four times per year.31 The Provost position at Haverford 

did not entail significant fundraising responsibilities.32 In 2012, Bell left Haverford 

24 Id.

25 Dir. Defs.’ Opening Br. Ex. 16, at 3.

26 See id.

27 Dir. Defs.’ Opening Br. Ex. 19, at 33-34. Bell volunteered to host a dinner for members 

of Haverford’s Board of Managers and Lutnick was randomly assigned as her guest. Id.

28 Pls.’ Answering Br. Ex 19, at 47-48.

29 Dir. Defs.’ Opening Br. Ex. 19, at 18, 38-39.

30 Pls.’ Answering Br. Ex. 19, at 71-72.

31 Dir. Defs.’ Opening Br. Ex. 19, at 38-39.

32 Id. at 29-33.
8

to become the Provost, Dean of Faculty, and a professor of economics at Barnard 

College.33 That is her current position.

After leaving Haverford in 2012, Bell and Lutnick have had limited 

interactions outside of BGC. Lutnick introduced Bell to a wealthy family whose 

child was interested in attending Barnard.34 On occasion, Bell has recommended 

students to Lutnick for interviews at Cantor.35 Bell also mentored Lutnick’s son on 

occasion, advising him on academic growth and finding him an appropriate tutor at

Lutnick’s request.

36

 

2. Stephen Curwood

Curwood is a journalist, environmentalist, and businessperson. He is 

President of the World Media Foundation, Inc. and has hosted its public radio 

program “Living on Earth” for many years.37 Curwood joined BGC as a director in 

2009.38 He has not served on any other Cantor-affiliated board.39 

33 Id. at 18-19.

34 Pls.’ Answering Br. Ex. 19, at 92-94; see also Pls.’ Answering Br. Exs. 43-45.

35 Dir. Defs.’ Opening Br. Ex. 19, 56-58.

36 Id. at 134-35, 144-148, 155-60.

37 Dir. Defs.’ Opening Br. Ex. 17, at 16.

38 Dir. Defs.’ Opening Br. Ex. 7, at 5.

39 Id.
9

Curwood’s BGC directorship earned him an average of $164,500 per year 

between 2010 and 2017.40 His BGC compensation amounted to roughly 52.4% of 

his total household over that same time horizon.41 

Curwood first met Lutnick when Curwood joined the Haverford Board of 

Managers in 2000.42 The two served together on the Board of Managers and on 

various committees of the board for twelve years.43 Their service on the institutional 

advancement committee pertained to “[m]oney-raising.”44 Curwood’s positions at 

Haverford were unpaid.45

3. William Moran

Moran was previously employed by JPMorgan Chase (from 1975-2005) 

where he served as its General Auditor and Executive Vice President.46 Moran 

joined BGC as a director in 2013.47 He has served on the boards of three other 

Cantor-affiliated companies: eSpeed Inc. (BGC’s predecessor, from 1999-2005), 

40 Dir. Defs.’ Opening Br. Ex. 16, at 4.

41 Id.

42 Dir. Defs.’ Opening Br. Ex. 7, 4-5.

43 Dir. Defs.’ Opening Br. Ex. 17, at 26-40.

44 Id. at 39.

45 Id. at 35-36.

46 Dir. Defs.’ Opening Br. Ex. 7, at 2.

47 Dir. Defs.’ Opening Br. 21.
10

ELX (from 2009-2013), and GFI Group, Inc. (which merged into BGC, from 2015-

2016).48

Moran earned an average of $135,655 per year between 2013 and 2017 from 

his service on Cantor-affiliated boards.

49

 That income represented 11.5% of his total 

household income over the same time frame.50 

Moran and Lutnick’s almost 20-year relationship has been largely 

professional.51 They have, over that time, attended a handful of social, charitable, 

or political events together.52 

C. The Transaction

The Special Committee met 19 times after its formation and engaged in 

months of negotiations with the Cantor Defendants.

53

 Several offers and 

counteroffers were exchanged.54 On July 13, 2017, the Special Committee voted to 

recommend that the Board authorize the acquisition of Berkeley Point and an 

48 Dir. Defs.’ Opening Br. Ex. 7, at 2-3, 13.

49 Dir. Defs.’ Opening Br. Ex. 16, at 6.

50 See id.

51 Dir. Defs.’ Opening Br. Ex. 10, at 11-15.

52 Id.

53 Dir. Defs.’ Opening Br. 2-3.

54 Id. at 2-3, 38-39.
11

investment in CCRE’s commercial mortgage-backed securities business.55 On July 

16, 2017, the Board adopted the Special Committee’s recommendation.56

On September 8, 2017, BGC purchased Berkeley Point from CCRE for $875 

million.57 BGC simultaneously invested $100 million in CCRE’s commercial 

mortgage-backed securities business in return for a 27% interest in CCRE.58 BGC’s 

Berkeley Point acquisition and CCRE investment are referred to as the 

“Transaction” in this decision.

D. Procedural History

Following BGC’s document production pursuant to a books and records 

demand, the plaintiffs filed derivative actions in this court challenging the 

Transaction in October and November 2018.

59

 The plaintiffs’ First Amended 

Stockholder Derivative Complaint (the operative Complaint) was filed in February 

2019, naming the Cantor Defendants, Bell, Curwood, Dalton, and Moran as 

defendants.60 The plaintiffs brought a claim against the directors for breaching their 

fiduciary duties by improperly approving a related-party transaction.61 The plaintiffs 

55 Dir. Defs.’ Opening Br. Ex. 99, at 0007. 

56 Dir. Defs.’ Opening Br. Ex. 103, at 1432. 

57 Dir. Defs.’ Opening Br. 39.

58 Id.

59 Dkt. 1; see Dkt. 6.

60 Dkt. 25. 

61 Id. ¶¶ 135-38.
12

also asserted a breach of fiduciary duty claim against the Cantor Defendants as 

controlling stockholders of BGC and separately against Lutnick for breaching his 

fiduciary duties with respect to the Transaction as an officer of BGC.62 

The defendants filed motions to dismiss pursuant to Court of Chancery Rules 

23.1 and 12(b)(6) that were denied by then-Chancellor Bouchard in September 

2019.63 In denying the Rule 23.1 motion, the court found that the plaintiffs had 

sufficiently pleaded facts creating a reasonable doubt regarding the impartiality of a 

majority of the demand board. In denying the Rule 12(b)(6) motion, the court held 

that the plaintiffs had pleaded facts sufficient to state non-exculpated claims against 

Bell, Curwood, Dalton, and Moran.

After discovery, the defendants filed the motions for summary judgment at 

issue in this decision.

64

 The plaintiffs dropped their claims against Dalton in their 

answering brief, leaving Bell, Curwood, and Moran as the individual Director 

Defendants.

65

 Oral argument on the motions for summary judgment was presented 

on June 22, 2021. The case is scheduled for trial beginning on October 11, 2021. 

62 Am. Compl. ¶¶ 139-48. 

63 See In re BGC P’rs, Inc., Deriv. Litig., 2019 WL 4745121 (Del. Ch. Sept. 30, 2019).

64 Dkt. 162; Dkt. 171. 

65 Pls.’ Answering Br. 2 & n.2.
13

II. LEGAL ANALYSIS

The Cantor Defendants move for summary judgment on the ground that the 

plaintiffs cannot established demand futility. In the alternative, they contend that

the plaintiffs should bear the burden of proving at trial that the Transaction is not 

entirely fair.

The Director Defendants move for summary judgment on the ground that 

plaintiffs cannot show that they face non-exculpated claims. In particular, the

Director Defendants argue that the plaintiffs have adduced no evidence that they 

acted in bad faith or advanced Lutnick’s self-interest. 

In this decision, I first decide the threshold issue of whether demand was 

excused. I find that genuine disputes of material fact exist regarding a majority of 

the BGC Board’s ability to impartially consider a demand to sue Lutnick. I then 

analyze whether a dispute of fact remains preventing a finding that the Director 

Defendants do not face a claim for breaching their duty of loyalty. I find that the 

plaintiffs cannot establish non-exculpated claims against Bell and Curwood but that 

factual issues remain regarding Moran that are best left for trial.

A. Standard for Summary Judgment

Under Court of Chancery Rule 56, summary judgment is granted only if “there 

is no genuine issue as to any material fact and . . . the moving party is entitled to 
14

judgment as a matter of law.”66 As the moving parties, the defendants have the initial 

burden of “demonstrating the absence of a material factual dispute.”

67

 The court 

must view evidence “in the light most favorable to the nonmoving party.”68 At this 

stage in the case, the court will not weigh evidence.69

If the defendants meet their burden, then the plaintiffs as the non-moving party 

must “adduce some evidence of a dispute of material fact” to avoid summary 

judgment.70 Summary judgment is “inappropriate” if a rational trier of fact could 

find any determinative fact in favor of the non-moving party.71 The “existence of a 

scintilla of evidence in support of the [non-moving party’s] position,” however, “is 

not sufficient.”72

66 Ct. Ch. R. 56(c).

67 In re Transkaryotic Therapies, Inc., 954 A.2d 346, 356 (Del. Ch. 2008) (quoting Levy v. 

HLI Operating Co., 924 A.2d 210, 219 (Del. Ch. 2007)).

68 Telxon Corp. v. Meyerson, 802 A.2d 257, 262 (Del. 2002).

69 See Cerberus Int’l, Ltd. v. Apollo Mgmt., L.P., 794 A.2d 1141, 1150 (Del. 2002). 

70 Metcap Secs. LLC v. Pearl Senior Care, Inc., 2009 WL 513756, at *3 (Del. Ch. Feb. 27, 

2009), aff’d, 977 A.2d 899 (Del. 2009) (TABLE). 

71 Cerberus Int'l, 794 A.2d at 1150; see also Cont'l Oil Co. v. Pauley Petroleum, Inc., 251 

A.2d 824, 826 (Del. 1969) (“When an ultimate fact to be determined is one of motive, 

intention or other subjective matter, summary judgment is ordinarily inappropriate.”).

72 Haft v. Haft, 671 A.2d 413, 419 (Del. Ch. 1995) (quoting Anderson v. Liberty Lobby 

Inc., 477 U.S. 242, 252 (1986)). 
15

B. Genuine Issues of Material Fact Prevent Summary Judgment on 

Demand Futility.

“The decision whether to initiate or pursue a lawsuit on behalf of the 

corporation is generally within the power and responsibility of the board of 

directors.”73 A stockholder can only pursue claims belonging to a corporation if (1) 

the corporation’s directors wrongfully refuse a demand to authorize the corporation 

to bring suit; or (2) demand would have been futile because the directors were 

incapable of impartially considering the demand.74 

The plaintiffs did not make a pre-suit demand on the Board and this court 

determined at the pleadings stage that a demand would have been futile. But the 

demand requirement’s “ultimate consideration does not end when the complaint is 

found to be sufficient.”75 The demand requirement, and doctrines of demand refusal 

and demand excusal that may satisfy it, exist beyond the procedural requirements of 

Court of Chancery Rule 23.1.76 Now, after discovery, the defendants remain “free 

73 In re Citigroup Inc. S’holder Deriv. Litig., 964 A.2d 106, 120 (Del. Ch. 2009); see 8 Del. 

C. § 141(a).

74 See Rales v. Blasband, 634 A.2d 927, 932 (Del. 1993); see also Stone v. Ritter, 911 A.2d 

362, 366-67 (Del. 2006).

75 Good v. Getty Oil Co., 518 A.2d 973, 974-75 (Del. Ch. 1986) (“Such resolution requires 

application of standards applicable to summary judgment as provided in Chancery Court 

Rule 56 or trial of the separate issue of demand futility under Chancery Court Rule 42(b).”). 

76 See, e.g., Rales, 634 A.2d at 932 (noting that Rule 23.1 “constitutes the procedural 

embodiment” of a “substantive principle of corporation law”).
16

to show on summary judgment by uncontradicted facts that the allegations made are 

untrue and there is therefore no proper standing.”

77

 

Regardless of the stage of the case, the court “counts heads” of the members 

of a board—as composed at the time the derivative suit was filed—to determine 

whether a majority of its members could have impartially considered a demand.78 

The Board consisted of five directors when the Complaint was filed: Lutnick, Bell, 

Curwood, Moran, and non-party David Richards.79 The defendants (unsurprisingly) 

do not contest Lutnick’s partiality,80 and the plaintiffs concede Richards’ 

independence.81 The three directors who constituted the Special Committee—Bell, 

Curwood, and Moran—remain at issue for the demand futility analysis. 

None of Bell, Curwood, or Moran is alleged to have received a benefit from 

the Transaction. A personal interest is not necessary, however, to show demand 

futility. “A director also is disqualified from exercising judgment regarding a 

litigation demand if another person was interested in the alleged wrongdoing, and 

77 Kahn v. Tremont Corp., 1992 WL 205637, at *2 n.2 (Del. Ch. Aug. 21, 1992); see also 

Heineman v. Datapoint Corp., 1990 WL 154149, at *3 (Del. Ch. Oct. 9, 1990) (explaining 

that “[i]f a review of the actual facts would show that” the elements of demand futility were 

not satisfied, “then that may be shown in an application for summary judgment”). 

78 In re Zimmer Biomet Holdings, Inc. Deriv. Litig., 2021 WL 3779155, at *10 (Del. Ch. 

Aug. 25, 2021).

79 Cantor Defs.’ Opening Br. 6.

80 Id. at 13.

81 Pls.’ Answering Br. 72 n.319.
17

the director lacks independence from that person.”82 A director “subject to the 

interested party’s dominion or beholden to that interested party” lacks 

independence.83 The plaintiffs allege that demand would have been futile because 

Bell, Curwood, and Moran are not independent of Lutnick, who stood on both sides 

of the Transaction.

To prevail, the defendants must show that, for at least two directors, there is 

no genuine dispute of material fact regarding their ability to make an impartial 

judgment about a litigation demand. This court in analyzing demand futility will 

consider factors that may affect a director’s disinterestedness and independence in 

their totality.84 Lutnick’s role as a controlling stockholder is relevant. As thenChancellor Bouchard noted in his denial of the defendants’ motions to dismiss, “our 

law is not blind to the practical realities of serving as a director of a corporation with 

a controlling stockholder.”85 

82 United Food and Com. Workers Union v. Zuckerberg, 250 A.3d 862, 887 (Del. Ch. 2020) 

(citing Rales, 634 A.2d at 936).

83 Del. Cty. Emps. Ret. Fund v. Sanchez, 124 A.3d 1017, 1023 n.25 (Del. 2015).

84 See, e.g., In re Oracle Corp. Deriv. Litig., 824 A.2d 917, 937 (Del. Ch. 2003); Marchand

v. Barnhill, 212 A.3d 805, 818 (Del. 2019) (noting that “things other than money, such as 

‘love, friendship, and collegiality’” are to be considered); Sanchez, 124 A.3d at 1019 (Del. 

2015) (explaining that a demand futility analysis considers alleged facts “in their totality 

and not in isolation from each other”).

85 BGC P’rs, 2019 WL 4745121, at *7; see also Leo E. Strine, Jr., The Delaware Way: 

How We Do Corporate Law and Some of the New Challenges We (and Europe) Face, 30 

Del. J. Corp. L. 673, 678 (2005) (discussing that Delaware courts are “most suspicious 

when the fiduciary who is interested is a controlling stockholder”).
18

I conclude that the defendants have not met their burden. I find that Bell could 

have independently considered a demand. But disputes of fact remain regarding 

Curwood and Moran’s independence that prevent summary judgment on that issue. 

Because Lutnick, Curwood, and Moran constitute a majority of the Board, the 

Cantor Defendants’ motion for summary judgment is denied.

1. Linda Bell

As described above, Bell’s primary interactions with Lutnick are through her 

board service at BGC (and Cantor-affiliate ELX) and earlier role at Haverford 

College.86 The ties between Bell and Lutnick that are raised, taken together, do not 

raise concerns of her partiality. 

Bell’s BGC-related compensation amounted to 7.6% of her household income

from 2010 to 2017.

87

 Her annual income from BGC, and ELX before that, averaged 

in the low six figures. Discovery has not revealed evidence that would lead a 

reasonable trier of fact to conclude that Bell would risk her reputation to protect a 

relatively small percentage of her household income.

88

86 See supra at Section I.B.1. 

87 Dir. Defs.’ Opening Br. Ex. 16, at 3. 

88 Beam v. Stewart, 845 A.2d 1040, 1052 (Del. 2004) (explaining that plaintiffs must plead 

facts supporting the inference that “the non-interested director would be more willing to 

risk his or her reputation than risk the relationship with the interested director” to survive 

a motion to dismiss).
19

Bell’s Haverford associations also do not create a genuine dispute calling into 

question her impartiality from Lutnick. She has not been directly associated with 

Haverford since 2012. Lutnick’s role as a major Haverford donor has had no effect 

on Bell’s professional standing (if it ever did) in years. This case is therefore 

different from precedent in this court where directors with university ties were found 

to lack independence from significant donors.

In Oracle, for example, members of a special litigation committee were 

current, tenured professors at Stanford University who “share[d] in the benefits that 

come from serving at a university with a rich endowment.”89 In denying the SLC’s

motion to terminate a suit against defendants including a major Stanford donor, thenVice Chancellor Strine reasoned that “[a] reasonable professor giving any thought 

to the matter would obviously consider the effect his decision might have” on the 

university’s fundraising prospects.90 Bell’s circumstances are different. She was 

five years removed from Haverford when a demand would have been made on the 

BGC Board. There is no evidence from which the court can plausibly find that 

Lutnick’s importance to Haverford would have continued to influence her 

discretion.

91

89 Oracle, 824 A.2d at 943.

90 Id.

91 See also In re MFW S’holders Litig., 67 A.3d 496, 512-13 (Del. Ch. 2013) (finding 

connection between current tenured professor and member of Board of Visitors insufficient 

to create genuine issue of fact regarding professor’s independence); In re KKR Financial 
20

It is true that “past benefits conferred . . . may establish an obligation or debt 

(a sense of ‘owingness’) upon which a reasonable doubt as to a director’s loyalty to 

a corporation may be premised.”

92 But the record does not support a finding that 

Bell felt indebted to Lutnick. No facts suggest that she benefitted personally from 

Lutnick’s donations to Haverford while she served as Provost. And, beyond her 

appointment to Cantor-affiliated boards, no evidence indicates that Bell received 

benefits from Lutnick. An appointment to a controlled board cannot, by itself, lead 

to a finding of partiality for demand excusal purposes. Were that the law, demand 

futility would be a certainty in the controlling stockholder context.93

The record also lacks evidence that Bell and Lutnick socialized meaningfully 

beyond their professional relationship. The additional facts offered to suggest a 

potentially deeper bond between Lutnick and Bell center around Lutnick’s son. But 

they are hardly indicative of the sort of “emotional depth” necessary to show a lack 

of independence.

94 Advising a colleague’s family member—or facilitating a 

Hldg. LLC S’holder Litig., 101 A.3d 980, 997-98 (Del. Ch. 2014) (dismissing the relevance 

of (business) relationships that ended 12 and four years prior to the derivative suit when 

assessing independence).

92 In re Ply Gem Indus., Inc. S’holders Litig., 2001 WL 1192206, at *1 (Del. Ch. Oct. 3, 

2001).

93 See Aronson v. Lewis, 473 A.2d 805, 815 (Del. 1984) (emphasizing that the mere fact 

that a director serves on the board of a controlled company does not make that director not 

independent). 

94 MFW, 67 A.3d at 511.
21

mutually beneficial meeting—are not uncommon actions for the cordial among us. 

Even if the evidence showed that Bell went out of her way to assist Lutnick’s son, it 

would support an inference that Lutnick may feel a sense of gratitude to her rather 

than the other way around.

Viewing these interactions and the other evidence in the light most favorable 

to the plaintiffs, I find that there are no disputes of fact sufficient to raise a genuine 

dispute about Bell’s ability to impartially consider a demand. 

2. Stephen Curwood

I do not reach the same conclusion about Curwood. His BGC Board 

compensation alone creates a genuine issue of material fact as to his independence 

from Lutnick. Curwood’s service alongside Lutnick on the Board supplied him with 

more than half of his household income from 2010 to 2017.

95

 The portion of his 

annual income attributable to BGC steadily increased from 46.9% to 64.3% between 

2014 to 2017.96 

The Cantor Defendants rely on MFW to argue that Curwood’s BGC income

alone cannot evidence a lack of independence.

97

 Generally, “the existence of some 

95 Dir. Defs.’ Opening Br. Ex. 16, at 4.

96 Id.

97 Cantor Defs.’ Opening Br. 15 (citing Kahn v. M & F Worldwide Corp., 88 A.3d 635 

(Del. 2014), overruled on other grounds by Flood v. Synutra Int'l, Inc., 195 A.3d 754 (Del. 

2018)).
22

financial ties between the interested party and the director, without more, is not 

disqualifying.”98 This court is also mindful of the public policy concerns at play 

when wealth is used as a factor in analyzing independence.

99

 But more than “some

financial ties” exist between Curwood and Lutnick. “The inquiry must be whether, 

applying a subjective standard, those [financial] ties were material, in the sense that 

the alleged ties could have affected the impartiality of the individual director.”100

Viewing the evidence in the light most favorable to the plaintiffs, there is a plausible 

inference that Curwood’s director compensation was material to him.

In MFW, no “real evidence of [the director’s] economic circumstances” was 

proffered and the appellants did “nothing . . . to compare the actual circumstances of 

the [challenged directors] to the ties [they] contend[ed] affect[ed] their 

impartiality.”

101 Here, by contrast, it is obvious that the relevant compensation 

amounts to a majority of Curwood’s income. Curwood described the income as 

“important” and “[not] a trivial amount of money.”102 

98 Kahn, 88 A.3d at 649.

99 See, e.g., Chester Cty. Emps.’ Ret. Fund v. New Residential Inv. Corp., 2017 WL 

4461131, at *8 (Del. Ch. Oct. 6, 2017) (explaining how factoring wealth into an 

independence analysis could “discourage the membership on corporate boards of people 

of less-than extraordinary means” (quoting In re Walt Disney Co. Deriv. Litig., 731 A.2d 

342, 360 (Del. Ch. 1998) (internal quotation marks omitted))).

100 Kahn, 88 A.3d at 649.

101 Id.

102 Dir. Defs.’ Opening Br. Ex. 17, at 125.
23

More critically, Curwood’s board-related income has allowed him to pursue 

his passions while supporting his family. Curwood testified that he “was grateful 

that [the director position] would allow [him] to both feed [his] family and [continue 

his career in] public radio.”

103 It is difficult to imagine more personally motivating 

factors. Lutnick unilaterally possessed the power to remove Curwood’s directorship 

and, thus, a crucial source of income—a reality that Curwood understood.

104

 

The Director Defendants contend that Curwood was not dependent on his 

board-related income because he has “plenty of other options.”105 That may well be 

so and Curwood’s subjective belief as such may prove determinative. But that is a 

matter best addressed at trial. At the summary judgment stage, a reasonable 

inference can be drawn that Curwood’s judgment would have been clouded had he 

been confronted with a demand to sue Lutnick.

3. William Moran

Moran’s almost 20-year professional relationship with Lutnick leads to the 

most unique analysis of the three Director Defendants. His BGC Board 

compensation is hardly material to him given his net worth of nearly $20 million and 

pension of “something short of a million dollars a year” from JPMorgan Chase.106 

103 Id. at 124.

104 Id. at 119-21.

105 Id. at 124.

106 Dir. Defs.’ Opening Br. Ex. 24, at 22; Dir. Defs.’ Opening Br. Ex. 25, at 3.
24

There are no apparent close social or familiar ties between Moran and Lutnick. Yet 

a factual dispute about his ability to impartially consider a demand to sue Lutnick 

exists that prevents summary judgment on that issue. 

Moran’s respect for Lutnick is considerable. He described Lutnick as an 

“inspiration,” worried that he might get “teary-eyed” speaking about how Lutnick is

a “wonderful . . . good human being,” and noted how he is “proud to be associated 

with a man [like Lutnick]” in his deposition.107 This court has explained that a

director’s “exceptionally glowing” admiration for a controller combined with a 

lengthy relationship can cast “substantial doubt” on her ability to impartially 

consider a litigation demand against the controller.108 

Tragically, Cantor lost hundreds of employees on 9/11. Lutnick’s work 

supporting the families of those Cantor lost in the attacks is one source of Moran’s 

deep respect for Lutnick.109 The Director Defendants argue that Moran’s testimony 

about Lutnick cannot call into question Moran’s independence because it must be 

considered in the emotionally charged context of the 9/11 attacks.110

It is without question that Moran’s respect for Lutnick is well placed in that 

regard. And it may be reasonable to infer that Moran’s admiration for Lutnick did 

107 Dir. Defs.’ Opening Br. Ex. 24, at 86, 99.

108 In re NantHealth, Inc. S’holder Litig., 2020 WL 211065, at *7 (Del. Ch. Jan. 14, 2020). 

109 See Dir. Defs.’ Opening Br. Ex. 24, at 85-88.

110 Dir. Defs.’ Reply Br. 15-16. 
25

nothing to sterilize his discretion. But it is also reasonable to infer that Moran’s 

reverence for Lutnick could have colored his judgment had he been asked to press 

derivative claims against Lutnick. Laudable behavior in the wake of a national 

tragedy may well strengthen ties of loyalty. At present, the plaintiffs are entitled to 

the inference that favors their position. 

* * *

Although Bell could have impartially considered a demand, I cannot conclude 

that no factual disputes remain regarding Curwood and Moran’s independence from 

Lutnick. Because Curwood, Moran, and Lutnick made up a majority of the demand 

board, I conclude that the Cantor Defendants’ motion for summary judgment on the 

basis of demand futility must be denied. 

C. Summary Judgment Is Granted as to Bell and Curwood but Not 

Moran.

The Director Defendants also ask the court to grant summary judgment 

because the plaintiffs cannot establish non-exculpated claims against Bell, Curwood, 

or Moran given the Section 102(b)(7) provision in BGC’s charter.111 Section 

102(b)(7) was adopted to “free[ ] up directors to take business risks without worrying 

about negligence lawsuits.”

112 Accordingly, as the Delaware Supreme Court 

111 Defs.’ Mot. to Dismiss Opening Br. Ex. 1, Article VII (Dkt. 39).

112 Malpiede v. Townson, 780 A.2d 1075, 1095 (Del. 2001) (discussing that Section 

102(b)(7) was adopted following Smith v. Van Gorkom to “free directors of personal 
26

explained in Cornerstone, “[w]hen the independent directors are protected by an 

exculpatory charter provision and the plaintiffs are unable to plead a non-exculpated 

claim against them, those directors are entitled to have the claims against them 

dismissed.”113 A plaintiff may establish a non-exculpated claim by pleading that the 

directors: (1) “harbored self-interest adverse to the stockholders’ interests”; (2) 

“acted to advance the self-interest of an interested party from whom they could not 

be presumed to act independently”; or (3) “acted in bad faith.”114 

The parties agree that the first Cornerstone prong is not relevant here. None 

of Bell, Moran, or Curwood is accused of acting out of self-interest. As to the 

remaining Cornerstone prongs, the parties have differing views about their meaning, 

whether they overlap, and if they are at issue. 

The plaintiffs contend that they are relying exclusively on the second prong 

of Cornerstone and disclaim any arguments that the Director Defendants acted in 

bad faith.115 They argue that the Director Defendants have not met their burden of 

showing an absence of a factual dispute “that they were independent of, and acted 

liability in damages for due care violations, but not duty of loyalty violations, bad faith 

claims and certain other conduct”). 

113 In re Cornerstone Therapeutics Inc. S’holder Litig., 115 A.3d 1173, 1176 (Del. 2015).

114 Id. at 1179-80; see also id. at 1187 n.54 (“By parity of reasoning, if after discovery, 

there is evidence from which a fact-finder could conclude that the independent directors 

breached their duty of loyalty, a trial is necessary to determine the directors’ liability.”).

115 Pls.’ Answering Br. 71 n.318.
27

independently from, Lutnick.”116 The Director Defendants, for their part, assert that 

the plaintiffs have improperly collapsed the second and third prongs by “rely[ing]

on the Transaction process to support an independence claim.”117 They describe the 

“second—independence—prong” as focused on considerations such as personal and 

financial ties between directors and a controller.

118 The Director Defendants view 

the second prong as entirely distinct from the third, “bad-faith prong,” which they 

say is intended to address the deal process.119

The second Cornerstone prong, however, takes into consideration both

independence and process by its very terms. A director must have “acted to advance 

the self-interest of an interested party” and the interested party must be one “from 

whom [the director] could not be presumed to act independently” for the director to 

face a non-exculpated claim for breach of the duty of loyalty.120 Thus, if the director 

is either (1) shown to be independent or (2) shown not to have actively furthered the 

116 Id. at 96. 

117 Dir. Defs.’ Reply Br. 24. 

118 Id.

119 Id. at 24-25.

120 Cornerstone, 115 A.3d at 1180; see also In re Oracle Corp. Deriv. Litig., 2021 WL 

2530961, at *7, *9 (Del. Ch. June 21, 2021) (describing the second prong of Cornerstone 

as itself a “two-prong test”).
28

conflicted party’s interests, dismissal is appropriate under the second prong of 

Cornerstone.

121

 

The analysis of the Director Defendants’ independence on the question of 

demand futility is therefore not determinative of whether they are entitled to 

dismissal from the action under Cornerstone. It only answers part of the question. 

Even if a director is found to lack independence for purposes of evaluating a demand 

to sue an interested party, the court must also consider whether she acted to advance 

the self-interest of the same interested party. A plaintiff claiming that a 

“control[led]” director breached her duty of loyalty must demonstrate that the 

director’s conduct “comport[ed] with the wishes or interests of the corporation (or 

persons) doing the controlling.”122

 The different contexts in which Delaware courts analyze demand futility and 

director liability validate this distinction. A demand futility analysis is an exercise 

in the hypothetical. If a conflicted party—like a controller—benefits from a 

transaction, the court asks whether a director could theoretically have exercised 

121 This court has previously referred to the second prong of Cornerstone—in passing—

as the “independence” prong. See, e.g., Morrison v. Berry, 2019 WL 7369431, at *12 

(Del. Ch. Dec. 31, 2019) (“[T]o survive the Motion to Dismiss . . . the Plaintiff must 

plead a non-exculpated claim, which requires sufficiently alleging the Director 

Defendants were either self-interested, lacked independence, or acted in bad faith.” 

(citing Cornerstone, 115 A.3d at 1175-76)). But the use of “independence” as a 

shorthand descriptor of the second Cornerstone prong should not be read to nullify the 

two-step nature of the inquiry. 

122 Orman v. Cullman, 794 A.2d 5, 24 (Del. Ch. 2002) (quoting Aronson, 473 A.2d at 816). 
29

impartial judgment if confronted with a demand to sue the conflicted party. The 

considerations are highly personal given the obvious reality that suing a colleague is 

no small matter. As the court explained in Oracle, a director faces greater difficulty 

in deciding “there is reason to believe that [a] fellow director has committed serious 

wrongdoing and that a derivative suit should proceed against him” than in “denying 

[the] fellow director the ability to proceed on a matter important to him.”123 A

director’s objectivity concerning a hypothetical demand could be compromised even 

if her actions in evaluating a transaction were beyond reproach. 

The analysis of whether a director faces a claim for breaching her duty of 

loyalty, by contrast, requires the court to assess the director’s real-world actions (or 

inactions) in the context of her lack of independence. If, for example, a director was 

the lifelong friend of a controller but acted only to advance the interests of the 

company and its minority stockholders (rather than the controller’s self-interests)

during negotiations, the director could hardly be accused of breaching her duty of 

loyalty. There must also be evidence (or, at the pleadings stage, well-pleaded 

allegations) that the director took steps in furtherance of the controller’s interests to 

support a non-exculpated claim. 

123 Oracle, 824 A.2d at 940; see also Marchand, 212 A.3d at 819 (explaining that “the 

decision whether to sue someone is materially different and more important than the 

decision whether to part company with that person on a vote about corporate governance”). 
30

The third prong of Cornerstone asks a different question: Did the director 

exercise “subjective bad faith” out of a malevolent motivation to cause harm or 

“consciously and intentionally disregard[]” her duties?124 There exist scenarios 

where a director knowingly violates the law or undertakes intentional misconduct 

unrelated to a desire to advance the interests of a conflicted party. In such cases, 

prong three applies.

Here, the plaintiffs’ contentions concern aspects of the Special Committee’s 

negotiation process that arguably furthered Lutnick’s interests in a conflicted 

acquisition. They are focused on the second prong of Cornerstone. Accordingly, I 

must analyze whether the Director Defendants lacked independence from Lutnick 

and “acted to advance” Lutnick’s self-interest.125 In conducting this analysis, I must 

consider each of Bell, Curwood, and Moran individually.126 “‘Group pleading’ will 

not suffice.”127 If there is evidence from which a rational fact finder could conclude 

124 See In re Walt Disney Co. Deriv. Litig., 906 A.2d 27, 62-64, 65 n.104 (Del. 2006) 

(describing a hypothetical director as acting in bad faith when “because of subjective 

hostility to the corporation on whose board he serves, [he] fails to inform himself of, or to 

devote sufficient attention to, the matters on which he is making decisions as a fiduciary”); 

Lyondell Chemical Co. v. Ryan, 970 A.2d 235, 240 (Del. 2009) (noting that “bad faith 

encompasses not only an intent to harm but also intentional dereliction of duty”); Chen v. 

Howard-Anderson, 87 A.3d 648, 683-85 (Del. Ch. 2014) (discussing Delaware courts’ 

approach to finding “bad faith”). 

125 Cornerstone, 115 A.3d at 1180. 

126 Id. at 1182 (“[E]ach director has a right to be considered individually when the directors 

face claims for damages in a suit challenging board action.”).

127 In re Tangoe, Inc. S’holders Litig., 2018 WL 6074435, at *12 (Del. Ch. Nov. 20, 2018); 

see also In re Dole Food Co., Inc. S’holder Litig., 2015 WL 5052214, at *39 (Del. Ch. 
31

that a Director Defendant breached their duty of loyalty, the matter must be resolved 

at trial.

1. Linda Bell

As explained above, there is no genuine dispute that Bell is independent of 

Lutnick for purposes of a litigation demand.128 She is likewise independent for

Cornerstone purposes. The further question of whether Bell acted to advanced 

Lutnick’s interests is moot.129 In any event, no genuine factual dispute about Bell’s 

actions in negotiating or approving the Transaction is raised that could give rise to a 

non-exculpated claim. The Director Defendants’ motion for summary judgment is 

granted as to Bell.

2. Stephen Curwood

Unlike Bell, there is a genuine dispute of material fact regarding Curwood’s 

independence from Lutnick in the demand futility context.130 These concerns remain 

relevant under Cornerstone.

131

 But the Director Defendants have demonstrated that 

Aug. 27, 2015) (noting that “[t]he liability of the directors must be determined on an 

individual basis because the nature of their breach of duty (if any), and whether they are 

exculpated from liability for that breach, can vary for each director” (citation omitted)). 

128 See supra Section II.B.1.

129 That is, the plaintiffs necessarily cannot show that Bell both lacks independence and 

advanced Lutnick’s interests as they must to maintain a non-exculpated claim against her.

See supra note 120 and accompanying text (discussing the second prong of Cornerstone).

130 See supra Section II.B.2. 

131 To be clear, one could be independent for purposes of Cornerstone but not demand 

futility, where the more difficult question of bringing claims against a colleague is present. 
32

there is no genuine dispute that Curwood did not undertake actions to advance 

Lutnick’s self-interest in the Transaction. 

After a review of the record, I conclude that the plaintiffs have not identified 

evidence to the contrary that a rational trier of fact would find determinative. A

plaintiff’s ability to state a duty of loyalty claim against interested fiduciaries 

supporting entire fairness review does not relieve the plaintiff of her “responsibility 

to plead a non-exculpated claim against each director” who seeks dismissal.132 

Under Delaware law, “that individualized consideration does not start with the 

assumption that each director was disloyal; rather, ‘independent directors are 

presumed to be motivated to do their duty with fidelity.’”133 

The evidence the plaintiffs rely on either concerns the Special Committee as 

a whole or (as discussed below) Moran.134 There is nothing implicating Curwood

individually. Curwood was not the Chair of the Special Committee, is not alleged 

to have engaged in separate discussions with Lutnick, and did not take a particularly 

active role in negotiations.135 In short, there are no specific facts demonstrating the 

But the facts presented in Section II.B.2 evidence a genuine dispute of material fact that 

bars a finding of independence under Cornerstone.

132 Cornerstone, 115 A.3d at 1180 (emphasis added). 

133 Id. at 1182 (quoting MFW, 67 A.3d at 528). 

134 See infra Section II.C.3.

135 Compare Oracle, 2021 WL 2530961, at *9 (finding at the pleadings stage that a director 

acted to advance a controller’s interests where he was “the chairperson of the committee,” 
33

existence of genuine issues for trial. The Director Defendants’ motion for summary 

judgment is granted as to Curwood. 

3. William Moran

Viewing the record in the light most favorable to the plaintiffs, I necessarily 

reach a different conclusion regarding Moran. As explained above, there is a 

genuine dispute of material fact regarding Moran’s independence in the demand 

futility context.

136

 There is also a genuine factual dispute about whether Moran may 

have acted to advance Lutnick’s interests during negotiations. 

Moran’s understanding of Lutnick’s role in the Transaction was that 

“[Lutnick] could negotiate for BGC with himself as Cantor.”137 Moran testified that 

he was mindful of Lutnick’s opinion regarding the Special Committee’s selection of 

its legal advisor.138 Moran also ran potential financial advisors past Lutnick before 

one was retained by the Special Committee.

139

 Certain evidence suggests that he 

may have viewed BGC’s timetable for the transaction as at least partially driven by 

“attended a meeting with [the counterparty] without the other two directors of the Special 

Committee,” and “took an active role in negotiations”). 

136 See supra Section II.B.3. 

137 Dir. Defs.’ Opening Br. Ex. 24, at 160-161.

138 Id. at 181-82. 

139 Id. at 187-193.
34

Lutnick.140 And he communicated directly with Lutnick about the deal process on 

several occasions.

141

It may ultimately be that Moran engaged in hard-fought, arms-length 

negotiations to benefit BGC and its stockholders. Moran’s characterizations of 

himself as a director that stands up to Lutnick could bear out as to the negotiation of 

the Transaction.

142

 At this stage, however, a factual dispute remains that is best 

resolved at trial. 

D. Defendants Cannot Shift the Burden of Persuasion.

Finally, the Cantor Defendants ask that the court shift the burden of persuasion 

under the entire fairness standard to the plaintiffs. “When the standard of review is 

entire fairness, ab initio, director defendants can move for summary judgment on 

either the issue of entire fairness or the issue of burden shifting.”143 “[I]f the record 

does not permit a pretrial determination that the defendants are entitled to a burden 

shift, the burden of persuasion will remain with the defendants throughout the trial 

to demonstrate entire fairness of the interested transaction.”144

140 See Pls.’ Answering Br. Ex. 87.

141 See, e.g., Pls.’ Answering Br. Ex. 84; Pls.’ Answering Br. Ex. 86; Pls.’ Answering Br. 

Ex. 123. 

142 See Dir. Defs.’ Opening Br. Ex. 24, at 55-56.

143 Emerald P’rs v. Berlin (Emerald II), 787 A.2d 85, 98-99 (Del. 2001). 

144 Am.’s Mining Corp. v. Theriault, 51 A.3d 1213, 1243 (Del. 2012). 
35

The burden of persuasion can be shifted from the defendants to the plaintiffs 

by “an approval of the transaction by an independent committee of directors or an 

informed majority of minority shareholders.”145 Here, BGC minority stockholders 

did not vote on the Transaction. For the burden to shift, I must therefore find that 

the Special Committee was independent, meaning that it “function[ed] in a manner 

which indicates that the controlling stockholder did not dictate the terms of the 

transaction and that the committee exercised real bargaining power ‘at an armslength.’”146

 “At a minimum . . . the members of the committee must be disinterested 

and independent.”147 Because I have found genuine issues of material fact regarding 

both Curwood and Moran’s independence and Moran’s actions in view of Lutnick’s 

interests during negotiations, the defendants are not entitled to a pre-trial 

determination on burden shifting.

145 Kahn v. Lynch Commc’n Sys., 638 A.2d 1110, 1117 (Del. 1994).

146 Kahn, 88 A.3d at 646 (quoting Kahn, 694 A2d at 429). Burden shifting at the summary 

judgment stage is uncommon. Id. (“[D]eciding whether an independent committee was 

effective in negotiating a price is a process so fact-intensive . . . that a pretrial determination 

of burden shifting is often impossible.”).

147 In re Orchard Enters., Inc. S’holder Litig., 88 A.3d 1, 25 (Del. Ch. 2014) (citing MFW, 

67 A.3d at 509).
36

III. CONCLUSION

The Cantor Defendants’ motion for summary judgment is denied. The 

Director Defendant’s motion for summary judgment is granted with respect to Bell 

and Curwood and denied with respect to Moran.