IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
CITY PENSION FUND FOR FIREFIGHTERS AND POLICE OFFICERS IN THE CITY OF MIAMI, on behalf of itself and all others similarly situated, Plaintiff,

v. THE TRADE DESK, INC., LISE J. BUYER, KATHRYN E. FALBERG, THOMAS FALK, JEFF GREEN, ERIC B. PALEY, DAVID R. PICKLES, BLAKE GRAYSON, GOKUL RAJARAM, BRIAN J. STEMPECK, and DAVID B. WELLS, Defendant s
. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) C.A. No. 2021

- 0560

- PAF

MEMORANDUM OPINION Date Submitted: April 11 , 2022

Date Decided: Ju ly 2 9 , 202 2 Gregory V. Varallo, Andrew E. Blumberg, Daniel E. Meyer, BERNSTEIN LITOWITZ BERGER & GROSSMANN LLP, Wilmington, Delaware; Mark Lebovitch, Reuben Gottlieb, Jeroen van Kwawegen, BERNSTEIN LITOWITZ BERGER & GROSSMANN LLP , New York, New York; Jeremy Friedman, David Tejtel, Julie Palley, FRIEDMAN OSTER & TEJTEL PLLC, Bedford Hills, New York; Attorneys for Plaintiff City Pension Fund for Firefighters and Police Officers in the City of Miami

. William M. Lafferty, Ryan D. Sto ttmann, Sabrina Hendershot, MORRIS, NICHOLS, ARSHT & TUNNELL LLP, Wilmington, Delaware; Attorneys for Defendants Lise J. Buyer, Gokul Rajaram, and David B. Wells.Peter J. Walsh, Jr., Jacqueline A. Rogers, Abraham C. Schnei der, POTTER ANDERSON & CORROON L LP, Wilmington, Delaware; Matthew Rawlinson, LATHAM & WATKINS LLP, Menlo Park, California; Colleen Smith, LATHAM & WATKINS LLP, San Diego, California; Kristin Murphy, LATHAM & WATKINS LLP, Costa Mesa, California; Attorneys f or Defendants The Trade Desk, In c., Kathryn E. Falberg, Thomas Falk, Blake Grayson, Eric B. Paley, David R. Pickles, and Brian J. Stempeck

. Brad D. Sorrels, Shannon E. German, Benjamin M. Potts, WILSON SONSINI GOODRICH & ROSATI, P.C., Wilmington, Delaware ; David J. Berger, Steven M. Gug genheim, WILSON SONSINI GOODRICH & ROSATI, P.C., Palo Alto, California; S. Toni Wormald, WILSON SONSINI GOODRICH & ROSATI, P.C., San Francisco, California; Attorneys for Defendant Jeff Green

.

FIORAVANTI, Vice ChancellorThis case involves a stockholder challenge to an amendment to the certificate of incorporation of The Trade Desk, Inc. (“TTD” or the “Company”) that extended the duration of its dual

- class stock structure. In effect, the amendment prolonged voting control held by TTD’s co

- fo under and Chief Executive Officer, Jeffrey Green, who owns 98% of the Company’s high

- vote Class B common stock. The plaintiff alleges that Green, the Company’s board of directors, and certain officers breached their fiduciary duties in approving and obtai ning stockholder votes for the amendment. The defendants have moved to dismiss the complaint under Court of Chancery Rule 12(b)(6) for failure to state a claim upon which relief can be granted. There is no dispute that the amendment w as an interested tra nsaction involving a controlling stockholder, which is presumptively subject to review under the exacting entire fairness standard. The defendants’ primary argument in support of their motions is that the transaction complied with the framework set forth in Kahn v. M & F Worldwide Corp. , 88 A.3d 635 (Del. 2014) (“ MFW ” ) , thus subjecting the transaction to business judgment review rather than the entire fairness standard. Plaintiff argues that the defendants have not satisfied two of the six elements of the MFW framework. For the reasons explained below, the court concludes that the defendants have satisfied MFW . Thus, the transaction is subject to review under the business judgment standard , and the Complaint must be dismissed.2 I. BACKGRO UND The facts recite d in this Memorandum Opinion are drawn from the Verified Class Action Complaint (the “Complaint”) and documents integral thereto or otherwise subject to judicial notice

. A. The Parties Plaintiff City Pension Fund for Firefighters and Police Officers in T he Ci ty of Miami (“City Pension Fund” or “Plaintiff” ) alleges that it has held Class A stock of
TTD at all relevant times

. 1
Defendant TTD is a Delaware Corporation headquartered in Ventura, Cali fornia. 2 TTD is a technology company that markets “ a software pl atform to provide data

- driven digital advertising campaigns

. ” 3 Defendant Jeff Green co founded the Company and has served as its President, Chief Executive Officer (“CEO”) , and as a director of the Company since 2009

. 4 Green has also been chairman of the Company ’s board of directors (the “Board”) at all relevant times

. 5

1 Dkt. 1 (“ Compl. ”) ¶ 23.
2 Id. ¶ 24.
3 Id. ¶ 38.
4 Id. ¶ 25.
5 Id. ; The Trade Desk, Inc., Schedule 14A (Apr. 13, 2021) (the “ 20 21 Proxy”) at 9

. Documents filed with the United States Securities and Exchange Commission (“SEC”) that are cited in this Memorandum Opinion are properly within the court’s view as: (i) docum ents incorporated by reference to Plaintiff’s Complaint; and (ii ) public filings, to the3 Defendant David R. Pickles is the other c o - founder of TTD

. 6 Pickles serves as TTD’s Chief Technology Officer

. 7 Defendant Blake Grayson has served as the Company’s Chief Financial Office r (“CFO”) since 2019

. 8 Together, Green, Pickles, and Grayson constitute the “Officer Defendants.” When it approved the challenged certificate amendment, the TTD board of directors consisted of Green and seven outside directors: Lise J. Buyer , Gokul Rajar am , Kathryn E. Falberg , David B. Wells , Thomas Falk , Eric B. Paley , and Brian J. Stempeck ( collectively the “ Director Defendants” ). 9 Buyer, Rajaram, and Wells served on a special committee of the TTD board that negotiated the certificate amendment with Gr een and recommended that the Board approve it

. 10 The named defendants are collectively referred to as the “Defendants.”
B. The Company’s Stock Structure
TTD has two classes of common stock. The Company’s Class A common stock trades publicly on the NASDAQ Global Market under the ticker symbol

extent they address publicly available facts not subject to reasonable dispute. In re Gen. Motors (Hughes) S’holder Litig. , 897 A.2d 162, 169

– 70 (Del. 2006)

. 6 Compl. ¶ 10.
7 Id. ¶ 26. Pickles joined the Company’s Board in Februa ry 2021. Id.
8 Id. ¶ ¶ 8, 27

. 9 Id. ¶¶ 25

– 26, 28

– 34.
10 Id. ¶ 67 ; The Trade Desk, Inc., Schedule 14A (Oct. 27, 2020) (the “2020 Special Proxy”) at “ LETTER FROM THE SPECIAL COMMITTEE

. ”4 “TTD” and entitles its holder to one vote per share

. 11 The Company’s Class B common stock , which is not publicly traded, is entitled to t en votes per share. 12 This dual

- class common stock structure was created in conju nction with the Company’s initial public offering in 2016 (the “IPO”)

. 13 The original C lass B stock holders included Green, members of management, and certain venture capital investors that had supported the Company’s growth as a private entity. 14 Of the 33 .4 million Class B shares originally issued, Green received approximately 8.9 million. 15 Since th e IPO, t he Class B stockholders have control led the Company : Because of the ten

- to

- one voting ratio between our Class B and Class A common stock, the holders o f our Class B common stock collectively continue to control a majority of the combined voting pow er of our common stock and therefore are able to control all matters submitted to our stockholders for approval . . .

. 16 By March 2020, the number of Class B s hares outstanding had declined to approximately 5. 2 million , with Green own ing 9 7.6 % of them. 17 When added to the Class A shares that he beneficially owned, Green at that time controlled

11 Id. ¶ 39; The Trade Desk, Inc. , Form 10

- K (Feb. 28, 2020) at 31

. 12 Co mpl. ¶ 39.
13 2020 Special Proxy at 12

– 13.
14 Id.
15 Id.
16 The Trade Desk, Inc., Form 10

- K (Feb. 28, 2020) at 31.
17 The Trade Desk, Inc., Schedule 14A (Apr. 14, 2020) (the “2020 Annual Proxy”) at 49 (reflecting Green’s ownership of 5,071,141 Class B shares)

.5 approximately 55% of the combined voting power of the outstanding Cl ass A and Class B common stock. 18 The Company’s amended and restated certificate of inco rporation (the

“ Certificate ”) restricts the ownership of Class B common stock to its original owners and “Permitted Transferee[s]” as defined in the Certificate

. 19 If a Class B share is transferred to someone other than a Permitted Transferee, it is autom atically converted into Class A common stock on a 1

- for

- 1 basis

. 20
The Certificate also provides for the elimination of the Class B Stock once

“ the number of outstanding s hares of Class B Common Stock represent less than ten percent (10%) of the aggregate number of shares of the then outstanding Class A Common Stock and Class B Common Stock ” (the “Dilution Trigger”). 21 Once the Dilution Trigger is tripped, each share of Cla ss B common stock is automatically converted into Class A common stock on a 1

- for

- 1 basis , and the Class B stock is canceled. 22

18 Id.
19 Dkt. 6 3 , Ex. 3 (the “ TTD Certificate ”) , Art

. IV(C)(3)(b) (the “Transfer Restriction Provision”).
20 Id.
21 TTD Certificate Art. V

. 22 TTD Certificate Art. IV(C)(3)(c).6 C. Green Learns of the Approaching Dilution Trigger in May 2020 As of March 31, 2020, the Class B common stock constituted 11.2% o f the Company’s total outstanding Class A and Class B common stock

. 23 Th e number of Class B common shares was continu ing to decline, as Green sold shares pursuant to a Rule 10b5

- 1 trading plan. 24 In late May 2020, Green learned that the Dilution Trigger wa s looming large

. 25 To avoid this control

- stripping event , Green contacted Company officers, his personal financial professionals, and the other holders of Class B stock for help. 26 On May 23, 2020, Green discussed the possible elimination of the Dilution T rigger with the Company’s Vice President, Investor Relations , Chris Toth

. 27 In a follow up email, Toth noted that: “We may have more leverage than we think. Externally no one knows you want to sell shares. Currently our [Certificate] state[s] there is N O timeframe to sunset shares. Therefore it is

23 2020 Annual Proxy at 2 (“On the [March 31, 2020] record date, there were 40,864, 997 shares of our Class A common stock outstanding and 5,169,630 shares of our Class B common stock outstanding.”)

. 24 Rule 10b5

- 1 of the Securities Exchange Act of 1934 “permits insiders to implement written, pre

- arranged stock trading plans when they are not in possession of material non

public information. Generally speaking, 10b5

- 1 plans offer a safe harbor for corporate insiders to sell stock by ceding trading authority to third parties with exclusive discretion to execute trades under certain pre

- deter mined parameters.” Laborers Dist. Council Constr. Indus. Pension Fund v. Bensoussan , 2016 WL 3407708, at *2 (Del. Ch. June 14, 2016) (footnote omitted), aff’d , 1 55 A.3d 1283 (Del. 2017).
25 Compl. ¶ ¶ 46 , 56

– 58

. 26 Id. ¶¶ 47

– 59 , 65

. 27 Id. ¶ 47.7 indefinite. ” 28 Toth outlined steps to propos e a Certificate amendment and highlighted the importance of pro c uring support of proxy advisory firms ISS and Glass Lewis

. 29 The next day, o n May 24, 2020, Green sent an email to his personal banker and the Company’s CFO, Grayson, directing them to cancel his ongoing 10b5

- 1 stock sale plan “as soon as possible.” 30 Green also had Julie Carolan, the Company’s Financial Reporting Specialist, ask Green’s bankers if t here w as any way to settle a portion of a conversion and sale of Class B stock placed the prior week with Class A stock instead

. 31
O n May 26, 2020, Grayson updated Green as to the expected timeline of the Dilution T rigger : “[I]f you AND Dave P[ickles] d on’t se ll any more Class B shares, you very likely are in the clear until at least 9/30 of this year before Class B crosses below 10% of total shares.” 32 Grayson further suggested that Green encourage Pickles not to convert Class B stock “over the next co uple mon ths until any structure

28 Compl. ¶ 4 9 (emphasis omitted) ; see also Dkt. 64, Ex. 20 ( document incorporated by reference into the Complaint)

. 29 Compl

. ¶¶ 4 8 , 51 ; Dkt. 64, Ex. 20

. 30 Compl. ¶ 54.
31 Id. ¶ 55. 32 Id. ¶ 56. The court notes that the operative complaint purports to quote documents th at Plaintiff has not attached as exhibits for the court’s review

. Such quotations to documents not within the court’s purview will be accepted as true for purposes of resolving th ese motion s only

.8 adjustments are discussed with the board.” 33 That same day, Carolan asked Green to confirm that he was willing to settle a portion of the prior week’s trade with Class A stock. 34 As outlined in her email to Green, settling the trade with Class A common stock instead of Class B common stock would have tax implication s , but would create a “larger cushion” to maintain the dual

- class structure without tripping the Dilution Trigger

. 35 Green responded: “I hate to forego 39,000,000 of long term capital gains, but I will if the [high] vote [share structure] lasts less than 6 months with current run rates.” 36 On May 27, 2020, Green emailed Wells asking for time to talk : “Can we get 30 mins tomorrow? Something has come up th at is quite urgent and important and I’d love to get 30 mins to share and get your feedback.” 37 Based on this email, Plaintiff finds it “reasonably inferable” that this meeting occurred and “that they

33 Id. ¶ 56

– 57.
34 Id. ¶ 59.
35 Id

. 36 Id. ¶ 60. Plaintiff i nsinuates that Green was willing to pay $39 million in capital gains tax. Id. ¶¶ 11, 61. Based on the trading price of TTD Class A stock at that time , it is apparent that Green was willing to forgo long term capital gains treatment as to the approximate $39 million in sale proceeds realize d from his settling the trade with 129,119 shares of Class A stock not that he would be liable for $39 million in capital gains tax

. Id. ¶ 59.
37 Dkt. 64, Ex. 21; Compl. ¶ 62.9 discussed Green’s competing desires for liquidity and continued control ov er Trade Desk. ” 38
On May 29, 2020, Green sent an email to t he Board calling a special meeting to discuss the Dilution Trigger

. 39 Green’s emai l stated, “ [s] ince we recently learned that the dual class sunset provision will take effect much sooner than we tho ught, we need to have a board meeting to discuss what to do next.” 40 Green ’s email proposed agenda items to discuss the impact of the dual

- class structure to date, the threat to the business without this structure, identifyin g available options for changin g the Dilution Trigger , and the applicable legal process for doing so

. 41 In response to a private email from Paley, Green stated that he believe d the Dilution Trigger would not be triggered until March 2021. 42 On June 2, 2 020 , Green sent an email to Pickl es asking him to refrain from sel l ing Class B stock : “I think we discussed this, but please don’t sell any b shares before we chat. We’ve got a limited runway to preserve our dual

- class status.” 43

38 Compl. ¶ 63.
39 Id. ¶ ¶ 62

– 63.
40 Id. ¶ 63.
41 Id.
42 Id. ¶ 64

. 43 Id. ¶ ¶ 64

– 65.10 D. The Special Committee Process
On June 3 , 2020, the Board met to discuss the Company’s dual

- class structure and, specifically, the Dilution Trigger

. 44 At that meeting, t he Board formed a special committee compris ing Buyer, Rajaram, and Wells (the “Special Committee”) and empowered them to evaluate a potential Cer tificate amendment to extend the Company’s dual

- class capitalization structure

. 45
After its formation , the Special Committee selected Buyer as its chair and retained Morris Nichols Arsht & Tunnell LLP (“M NAT ”) as its counsel

. 46 MNAT then reviewed the inde pendence of the Special Committee members

. 47 In late June 2020, the Special Committee interviewed three potential financial advisors, Perella Weinberg Partners (“PWP”), Moelis , and Centerview Partners (“ Centerview”). 48 In

44 Id. ¶ 66.
45 Id. ¶ 67 ; 2020 Special Proxy at 14 (“At the June 3, 2020 meeting, our board of directors . . . delegated to the Committee the full power and authority of our board of directors to, among other things, (i) rev iew and evaluate the advisability of the Potential Action, (ii) identify, revie w and evaluate alternatives to the Potential Action, (iii) recommend, reject or seek to modify the terms of the Potential Action, (iv) if the Committee considered it advisable o r appropriate, negotiate the structure, form, terms and conditions of the Poten tial Action and the form, terms and conditions of any definitive agreements or any amendments to the Company’s governing documents, (v) obtain any necessary or desirable advice, assistance and opinions from financial advisors or other advisors, consultants and agents selected by the Committee, (vi) recommend to the full board of directors what action, if any, should be taken by the Company with respect to the Potential Action, an d (vii) appoint one of its members as Chair of the Committee.”)

. 46 Compl. ¶ 82; 2020 Special Proxy at 15.
47 2020 Special Proxy at 15.
48 Compl. ¶ 68.11 its presentation to the Special Co mmittee, PWP expressed concerns over the feasibility and governance implications of a full recapitalization, instead favoring a n amendment to the Dilution Trigger in return for governance concessions

. 49 Centerview’s presentation highlighted the current mar ket trend away from dual

- class stock structure s and summarized the “lessons learned” from precedent “ Founder

led” recapitalizations

. 50 The Special Committee then formally retained Centerview

a s its financial advisor. 51 On July 2, 2020 , the Special Committee held a meeting with four MNAT attorneys and five Centerview representatives in attendance. 52 T he Special Committee discussed its process and the potential timing of a stockholde r meeting with respect to any negotiated proposal and “expressed an initial pr eference for a special meeting to be held in the fourth quarter of 2020.” 53 Additionally, “Centerview expressed a desire to . . . gather information concerning the Company’s
sto ckholder base and the Company’s estimates of when the number of outstanding sha res of Class B Common Stock will fall below 10% of the aggregate number of

49 Id. ¶ 69.
50 Id. ¶ ¶ 73

– 7 5. 51 Id. ¶ 77.
52 Id. ¶ 80 ; Dkt. 64, Ex. 31.
53 Compl. ¶ 80 ; Dkt. 64, Ex. 31.12 outstanding shares of . . . Common Stock.” 54 The Special Committee suggested that Centerview contact Toth and Carolan regarding these inquiries. 55
Center view ’s discussion materials f or the July 2, 2020 meeting included alternatives available as consideration for a c ertificate amend ment , including each alternative’s relative value to stockholders

. 56 Centerview reported that c ontrol

extension proposals typically place a higher emphasis on economic considerations and that governance measures alone may be in sufficient consideration for minority stockholders

. 57
At a July 23, 2020 Special Committee meeting, Centerview discussed the Company’s estimat ion that the Dilution Trigger could be tripp ed “ as early as the second quarter of 2021 ” and the “ assumptions underlying such estimate

. ” 58 T he Special Committee then authorized MNAT to inform Green ’ s counsel , Wilson Sonsini Goodrich & Rosati , P.C. (“Wilson Sonsi ni ”) , that the Special Committee

was no w willing “ to consider a proposal from Mr. Green regarding a potential extension of the Company ’s dual

- class capitalization structure

. ” 59

54 Comp l. ¶ 80.
55 Id. ; Dkt. 64, Ex. 33.
56 Compl. ¶ 78. The slide did not place a dollar value on any of the alternatives.
57 Id.
58 Id. ¶ 81.
59 Id. ¶ 82

.13 On July 24, 2020, Wilson Sonsini confirmed Green’s interest in presenting a n MFW

- compliant offer to the Special Commi ttee. 60 MNAT summarized this
response in an email to the committee, which stated, in part : [Green’s Counsel] did say that he and his client recognize the need for there to be a “business rationale” for the extension (and Jeff has one that he will offer up as part of the proposal) and the potential need to address other “governance issues” as par t of a proposal. He said his client is very willing to work with the Committee and will be “flexible”. He said the proposal will [be] made under the MFW structure. 61 On July 30, 2020, Wilson Sonsini informed MNAT that Green would deliver a formal proposal , featuring a “rationale for the business case,” by the end of the following week. 62 Plaintiff interprets these two responses as admissions that there

was no business rationale for pursuing the transaction and the entire Special Committee process was ther efore “just a ruse.” 63 On August 3, 2020, Green transmitted his proposal to the Special Committee (the “Initial Green Proposal”)

. 64 It contain ed three key provisions

. 65 First , in exchange for removing the Dilution Trigger , Green proposed that outstanding shares of Class B Common would automatically convert into Class A Common Stock upon

60 Id. ¶ 83.
61 Dkt. 64, Ex. 34 ; Compl. ¶ 83

. 62 Compl. ¶ 84.
63 Id. ¶ 83.
64 Id. ¶ 85.
65 Id.14 the occurrence of one of the following conditions: (i) the seven

- year anniversary of the adoption of the Certificate amendment (the “Sunset Provision”) ; (ii) the discretion of the Company’s Board, if Green was removed for cause from his positions as CEO, P resident, or director of the Company; or (iii) a date specified by the holders of at least 66

- 2/3% of the outstanding Class B common stock. 66 Second, stockholders would be provided with a right to act by written consent at duly

- called annual or special meetings, so long as Green and/or his affiliates hold more than 50% of the Company’s vo ting power. 67 Third, stockholders holding at least 10% of the C om pany ’s voting power during the immediately preceding one

- year period would be provided with a right to call special meeting s
. 68
T he Initial Green Proposal included a letter explaining the valu e to the Company of Green retaining control through the extensio n of the dual

- class common stock structure: [Green] believes that the continuation of the Company’s governance structure

— which will allow the Company to continue to be guided by the same visio n and long

- term perspective that have made the Company so succes sful, without distraction

— is firmly in the best interests of the Company and all of its stockholders. Indeed, Mr. Green believes that the same principles that caused the Company to adopt its c urrent governance structure in connection with its recent initia l public offering apply with equal, if not greater, force and importance now. This is

66 Id. at 33; see als o 2020 Special Proxy at 17.
67 Compl. at 33; see also 2020 Special Proxy at 17.
68 Compl. at 33 ; see also 2020 Special Proxy at 17.15 particularly true given that the Company, while very strong, faces new and unexpected challenges, as all c ompanies do at this time. These challenges, as you know, include navigating unprecedented market uncertainty and volatility that are completely untethered to the Company’s performance. In addition, management and the Board are faced with the task of steeri ng the Company and its employees through a global pandemic, all while managing a complex but extremely valuable business. 69 On August 4, 2020, the Special Committee met to discuss the Initial Green Proposal

. 70 The substantive portion of the meeting minutes consist of three sentences and lack any detail as to the Special Committee’s discussion with its

a dvisors. 71 The minutes conclude: The Committee expressed its belief that a structure under which Mr. Green maintained voting control for at least seven to t en years post initial public offering is in the best interests of all of the Company's stockholders based on a number of different considerations, including the value associated with Mr. Green’s leader ship and vision for the Company. 72
Centerview’s materia ls for this meeting estimated that outstanding Class B shares would equal less than 10% of the Company’s aggregate outstanding shares by the second quarter of 2021, thereby tripping the Dilution Trigg er
. 73

69 Compl. ¶ 86; 2020 Special Proxy at Appendix D

- 1.
70 Compl. ¶ 88.
71 Dkt. 64, Ex. 36 at TTD0000261

. 72 Compl. ¶ 89; Dkt. 64, Ex. 36 at TTD0000261.
73 Compl. ¶ 89 ; Dkt. 64, Ex. 37 at TTD0000376

.16 T he Special Committee met again with its advisors o n August 7 and 11 to discuss the Initial Green Proposal and a potential c ounterproposal

. 74 At the August
11 meeting the committee also considered a potential timeline for a special meeting of stockholders to vote on a possible transaction

. 75 On August 14, 2 020, the Special Committee approved a counterproposal (the “Counterproposal”) to the Initial Green Proposal with seven substantive modifications to Green’s terms. 76 First, the C ounterpro posal shortened the Class B Sunset Provision date by two years, so all outstanding shares of Class B common stock would automatically convert to Class A common stock five years ( instead of

seven years) after the adoption of the Sunset Provision . Second, t he C ounterproposal removed the “for cause” limitation and the referenc es to Green’s directorship so that Green’s removal as CEO or President, either with or without cause, would automatically convert the Class B stock into Class A stock . Third, similar to the original Dilution Trigger , the C ounterproposal provided that the outstanding Class B common stock would automatically convert once it equaled a specific percentage (to be negotiated) of the Company’s aggregate outstanding stock. Fourth, the
C ounterproposal clarified that for shares to be counted towards the majority

74 Compl. ¶¶ 90

– 91.
75 Id. ¶ 9 1

. 76 Id. ¶ 92.17 ow nership requirement within the written consent clause those shares must be owned by Green or his controlled affiliates

. Fifth, the C ounterproposal modified the special meeting call right to be vested in stockholders holding 20% of the Company’s outstandin g common stock ( instead of a specific percentage of “ voting power ” ). Sixth, the C ounterproposal gave holders of Class A common stock the right to elect directors (with the num ber to be negotiated). Seventh, the C ounterproposal provided that the Company ’s independent directors would elect a lead independent director. Green ultimately accepted t he majority of the terms set in the Special Committee’s Counterproposal. In his August 20, 2020 response , Green pushed back on two of the m
. 77 Green rejected the ado ption of a new dilution trigger based on the ratio of Class B stock to the total number of outstanding shares of common stock

. 78 Additionally, Gr een specified that the holders of Class A common stock be permitted to elect 1 director if the board consists o f nine or fewer directors, and 2 directors if the board consists of ten or more directors. 79 The Special Committee continued to negotiate with G reen over the following few days

. 80 The Special Committee relented on its proposal for a new dilution trigger ba sed on share percentage , and

77 Id. ¶ 95; Dkt. 65, Ex. 45 at TTD0000516.
78 Compl. ¶ 95.
79 Id.
80 Id.18 Green conceded to providing the Class A stockholders with the right to elect 1 director if the board is eight or f ewer directors , and 2 director s if the board is nine or more directors

. 81 O n August 27, 2020, Green and the Speci al Committee memorialized their agreement

- in

- principle in a term sheet ( the “ Term Sheet ”)

. 82 The following chart illustrates the evolution from initial proposal to Term Sheet: 83

81 Id.
82 Compl. ¶ 94 ; 2020 Special Proxy at 18.
83 Compl. at 41; D k t. 65, Ex. 4 5 at TTD0000516.19 The full Board , including Green, met on September 3, 2020 , wi th MNAT and
Cen terview in attendance, to discuss the Special Committee’s negotiations, the proposed Term Sheet, and next steps

. 84 The a dvisors warned that the deal “may be viewed as novel” and “attract attention a nd scrutiny from stockholders and the broader market. ” 85 D uring this meeting, the B oard was shown C ompany projections indicating that the Dilution Trigger was expected to trip in the second quarter of
2021. 86 On October 16, 2020, the B oard voted to approve the amendment to the Certificate and the related terms (to gether, the “Dilution Trigger Amendment”)

. 87 Green, Stempeck , and Falberg abstained from the Board vote , due to their ownership of Class B stock

. 88 Following the vote , the Board began its campaign in support of the Dilution Trigger A mendment

. 89 As one of t he first steps of the campaign, the board distributed a letter to stockholders stating that the “proposals enable the board to end the dual

- class structure at an earlier date (in certain circumstances)

. ” 90

84 Compl. ¶ 97

. 85 Id.
86 Id. ¶ 99

. 87 Id. ¶ 100.
88 Id.
89 Id. ¶ 102.
90 Id.20 E. The Stockholder Vote On October 27, 2020, the Compa ny filed with the SEC a notice of special meeting of stockholders for December 7, 2020 (the “Special Meeting”) and a Definitive Proxy Statement (the “2020 Special Proxy”) to solicit stockholder votes in favor of the proposed transaction. 91
When the date o f the Special Meeting arrived on December 7, 2020 there was insufficient stockholder support to approve the Dilution Trigger Amendment. 92 As a result, the Company adjourned the Special Meeting to enable proponents additional time to garner more votes in fa vor of the transaction. 93 On December 22, 2020, the Company reconvened the Special Meeting, where the Dilution Trigger Amendment was approved, with 52% of the unaffiliated shares voting in favor

. 94 Once the Dilution Trigger Amendment had been approved, Gr een resumed disposing o f Class B shares

. Between December 2 4 , 2020, and April 19, 2021, he converted 544,139 Class B shares into Class A shares and sold them for aggregate proceeds of $435,481,252. 95

91 Id. ¶ 104.
92 Id. ¶ 115.
93 Id.
94 Id. ¶ 117

. 95 Id. ¶ 119.21 F. The Proposed Equity Award On December 3, 2020, a few days before the Specia l Meeting , TTD’s Compensation Committee , which includes Wells and Rajaram, considered a stock option grant to Green in his capacity as TTD ’s CEO. 96 A presentation from the

c ommittee’s compensation advisor, Compensia, outlined potentia l grant options inclu ding a n award amounting to 5% of the Company’s equity. 97 Plaintiff complains that stockholders were not aware at this time of these discussions regarding this possible award. 98 Almost a year later, on October 8, 2021, the Compensation Committee recommend ed and the Board approved a stock option grant to Green (the “2021 Grant”). 99 Under the 2021 Grant terms, Green may receive options allowing him to purchase up to 19.2 million shares of Class A common stock, at an exercise price of $68.2 9 per share, if sp ecified target goals are achieved and other vesting

96 Id. ¶ 113 ; Dkt. 55 (the “Supp. to Compl.”) ¶ 160.
97 Compl. ¶ 114.
98 Supp. to Compl. ¶ 161.
99 Id. ¶ 166. Pl aintiff does not assert any claims challenging the 2021 Grant itself. Instead, Plaintiff treats the 2021 Grant as evidence that the TTD Board operates with a “controlled mindset” and that the stockholder vote on the Dilution Trigger Amendment w as uninform ed. Id. ¶¶ 161, 171, 197. The 2021 Grant is currently the subject of separate litigation in this court. Huizenga v. Green, et al. , C.A. No. 2022

- 0461

- PAF; Int ’l Union of Operating Eng ’ rs Local 137, 137A, 137B & 137R Pension & Annuity Funds, e t al. v. Gr een, et al. , C.A. No. 2022

- 0560

- PAF . This opinion does not consider the claims asserted in th o se actions.22 conditions are satisfied. 100 This option grant only becomes exercisable and vested in eight tranc h es over a ten

- year term if certain stock price achievements are met. 101
G. Procedural History On June 28, 2021, Plaintiff filed its C omplaint asserting breach of fiduciary duty claims against Green in his capacity as a controlling stockholder (Count I), the Officer Defendants (Count II), and the Director Defendants (Count III)

. 102 Each claim is bas e d on the respective defendants ’ actions “imposing the unfair Trigger Amendment on Trade Desk and the Company’s public stockholders” and “failing to disclose to stockholders Green’s desire to sell Trade Desk shares and the date of the anticipated sunset of the dual class capitalization structure.” 103 On August 27, 2021, D efendants moved to dismiss the Complaint pursuant to Court of Chancery Rule 12(b)(6)

. 104 After the parties filed opening and answering briefs , Plaintiff sought leave to supplement the C omplai nt , which the court granted as unopposed

. 105 Plaintiff filed its Verified Supplement to the Complaint (the

100 Supp. to Compl. ¶ 167

. 101 Id. ¶ 168.
102 Dkt. 1.
103 Compl. ¶¶ 143, 148, 154.
104 Dkt. 17; Dkt. 28; Dkt. 38.
105 Dkt. 5 3 & 54

.23 “Supplement”) on November 29, 2021

. 106 On February 1, 2022, D efendant s moved to dismiss the Complaint , as supplemented

. 107 F ollowing full briefing, the court held oral argument on these motions on April 11, 2021. 108
II. ANALYSIS
On a motion to dismiss under Court of Chancery Rule 12(b)(6): (i) all well

- pleaded factual allegations are accepted as true; (ii) even vague allegations ar e well

- pleaded if they give t he opposing party notice of the claim; (iii) the Court must draw all reasonable inferences in favor of the non

- moving party; and ([iv]) dismissal is inappropriate unless the plaintiff would not be entitled to recover under any reasonably conceivable set of circumstances susceptible to proof. Savor, Inc. v. FMR Corp. , 812 A.2d 894, 896

– 97 (Del. 2002) (internal citations and quotation marks omitted). At this stage, the pleading standards are “minimal,” Central Mortg. Co. v. Morgan Stanley Mortg. Cap. Hldgs. LLC , 27 A.3d 531, 536 (Del. 2011), but the court need not “simply accept conclusory allegations unsupported by specific facts, nor do we draw unreasonable inferences in the plaintiff's favor.” Clinton v. Enter. Rent

- A

- Car Co. , 977 A.2d 892, 895 (Del. 200 9)

.

106 Dkt. 55

. 107 Dkt. 61; Dkt. 62 ; Dkt. 63; Dkt. 68.
108 Dkt. 91; Dkt. 95.24 A. The Defendants’ Exhibits In preparing the Complaint, Plaintiff utilized documents that the Company produced in response to Plaintiff’s demand to inspect books and records pursuant to 8 Del. C. § 220. 109 In resolving the books and records demand , the parties entered into a Confidentiality and Non

- Disclosure Agreement whereby the document s would “be deemed incorporated by reference in any complaint relating to the subject matter referenced in the Demands

. ” 110 Plaintiff cite d , but d id not attach as exhib its to its Complaint and Supplement , 3 8 documents provided in the 220 production

. Defendants respond ed by attach ing 71 document s as exhibits to their motions to dismiss, only 13 of which are cited in the Complaint. Notwithstanding their arrangement, t he p arties may not rely on private agreement to change the pleading standard at the motion to dismiss stage : [O]ur courts must regul ate how far down the road of incorporation by reference a defendant may go when plaintiff has well

- pled something as fact . . . even if another document might suggest the facts are otherwise. Section 220 documents may or may not comprise the entirety of th e evidence on a particular point. Until that is tested, Defendants cannot ask the court to accept their Section 220 documents a s definitive fact and thereby turn pleading stage inferences on their head. That is not, and should not be, the state of our law.

109 Compl. at 3; Supp. to Compl. at 3.
110 Dkt. 66, Ex. 63.25 In re Clovis Oncology, Inc. Deriv

. Litig. , 2019 WL 4850188, at *14 n.216 (Del. Ch. Oct. 1, 2019). “The incorporation

- by

- refer ence doctrine does not enable a court to weigh evidence on a motion to dismiss. It permits a court to review the actual document s to ensure that the plaintiff has not misrepresented their contents and that any inference the plaintiff seeks to have drawn i s a reasonable one.” Voigt v. Metcalf , 2020 WL 614999, at *9 (Del. Ch. Feb. 10, 2020). This doctrine therefore permits the cour t to consider extrinsic documents only for a limited purpose. “Where a defendant improperly and extensively uses Section 220 Do cuments in support of a Chancery Rule 12(b)(6) motion to support factual inferences that run counter to those supported in the co mplaint, the court may either exclude the extraneous matter from its consideration or convert the Chancery Rule 12(b)(6) motion into a motion for summary judgment.” In re CBS Corp. S ’ holder Class
Action & Deriv

. Litig. , 2021 WL 268779, at *18 (Del. Ch. Jan. 27, 2021), as corrected (Feb. 4, 2021). T herefore, instead of converting the present motions to dismiss into motions for su mmary judgment, the court declines to consider any extraneous documents submitted by D efenda nts that are not referenced in or integral
to Plaintiff’s pleadings or otherwise subject to judicial notice.26 B. The Presumptive Standard of Review Under Delaware law , a controlling stockholder owes fiduciary duties to the Company and its minority stockholde rs. eBay Domestic Hldgs, Inc. v. Newmark , 16 A.3d 1, 26 (Del. Ch. 2010). A stockholder owning “more than 50% of the voting power of a corporation” will be deemed a “controller” under Delaware law. In re KKR Fin. Hldgs

. LLC S'holder Litig. , 101 A.3d 980, 991 (Del. Ch. 2014), aff'd sub nom. Corwin v. KKR Fin. Hldgs

. LLC , 125 A.3d 304 (Del. 2015). At all relevant times, Green controlled more than 50% of the voting p ower of TTD’s outstanding voting stock. 111 Defendants do not dispute Green’s status as a controlling stockholder. “When a transaction involving self

- dealing by a controlling shareholder is challenged, the applicable standard of judicial review is entire fai rness, with the defendants having the burden of persuasion.” Americas Mining Corp. v. Theriault , 51 A.3d 1213, 1239 (Del. 2012). The entire fairness standard applies to “any transaction between a controller and the controlled corporation in which the

con troller receives a non

- ratable benefit.” In re EZCORP Inc. Consulting Agreement
Deriv

. Litig. , 2016 WL 301245, at *11 (Del. Ch. Jan. 25, 2016). This is because Delaware courts are aware that a controller enjoys a “uniquely advantageous

111 Compl. 3; see also Dkt. 63 (“Green Opening Br.”) at 9 (“Green has held more than 50% of the Company’s voting power since at least early 2018 . . .”).27 position for extra cting differential benefits from the corporation at the expense of minority stockholder s.” Id. “The risk is thus created that those who pass upon the propriety of the transaction might perceive that disapproval may result in retaliation by the controllin g shareholder.” Kahn v. Tremont Corp. , 694 A.2d 422, 428 (Del. 1997). Therefore, the entire fairness standard applies to “ensure that all parties to the transaction have fulfilled their fiduciary duties to the corporation and all its shareholders.” Id. The Dilution Trigger Amendment eliminated the Dilution Trigger, extended the duration of the dual

- class structure, and enabled Green to maintain voting control. Defendants do not dispute that the Dilution Trigger Amendment is a transaction that is presum ptively subject to review under the entire fairness standard. See IRA Tr. FBO Bobbie A hmed v. Crane , 2017 WL 7053964, at *9 (Del. Ch. Dec. 11, 2017) (concluding that a reclassification under which the controlling stockholder ensured that it would retain v oting control “well into the future” was presumptively subject to entire fairness revie w). Therefore, the court’s analysis of the motion s to dismiss begins with that presumption

. 112

112 In its brief, Plaintiff argued that the Dilution Trigger Amendment implicated the voting rights of TTD stockholders and, therefore, was subject to “heightened scrutiny.” Dkt. 76 (“Pl.’s Ans. Br.”) at 36

– 37 (citing Coster v. UIP Cos., Inc. , 255 A.3d 952 (Del. 20 21) ). In Coster , the Delaware Supreme Court held that even though a stock sale which diluted one of two equal stockholders below 50% satisfied the entire fairness standard, it was otherwise also subject to further review to assess whe ther it was otherwise inequitable or taken for28 C. MFW Analysis
In t he seminal case of MFW , the Delaware Supreme Court endorse d a framework that would alter the standard of review in a conflicted controlling stockholder transaction from entire fairness to the more lenient business judgment standard. To avoid entire fairness scrutiny through th is doctrinal escape hatch, the follo wing conditions must be met: (i) the controller conditions the procession of the transaction on the approval of both a Special Committee and a majority of the minority stockholders; (ii) the Special Committee is indepen dent; (iii) the Special Committee is empowered to freely select its own advisors and to say no definitively; (iv) the Special Committee meets its duty of care in negotiating a fair price; (v) the vote of the minority is informed; and (vi) there is no coercion of the minority.
MFW , 88 A.3d a t 645 (formatting altered).

the primary purpose of thwarting the plaintiff’s vote to elect directors. Id. at 953, 963 n.66. In so holding, the Court invoked the well

- settled doctrines of Schnell v. Chris

- Craft Industries., Inc. , 285 A. 2 d 437, 439 (Del. 197 1) (“inequitable action does not become permissible simply because it is legally possible”), and Blasius Industries., Inc. v. Atlas Corp. , 564 A.2d 651 , 661 (Del. Ch. 1988) (recognizing that if the board acts for the primary purpose of impeding stockholder s’ franchise rights, the board must prove a “compelling justification” for its actions). At oral argument, however, Plaintiff here acknowledged that it was not contending that the court must apply a Schnell analysis to the Dilution Tr igger Amendment if De fendants have satisfied MFW . Dkt. 95 (“Hrg. Tr.”) at 103

– 04.29 If D efendants satisfy MFW , then the transaction will be subject to business judgment review. But if P laintiff can plead a reasonably conceivable set of facts showing that any one of the enumerated conditions is not satisfied, then , the entire fairness standard governs
. Id. Although MFW was decided at the summary judgment stage and involved a freeze

- out merger , the MFW framework is not limited to those scenarios . The court has applied MFW at the motion to dismiss stage and in transactions other than freeze

out merge r s
. S ee , e.g. , Crane , 2017 WL 7053964, at *12

– 21 (applying MFW to a stock reclassification on a motion to dismiss); see also Tornetta v. Musk , 250 A.3d 793, 800 (Del. Ch. 2019) (reasoning that the MFW framework cou ld apply to review a challenge to executive compensation paid to a controlling stockholder); In re Martha Stewart Living Omnimedia, Inc. S’holder Litig. , 2017 WL 3568089, at *18

– 19 (D el. Ch. Aug. 18, 2017) (holding MFW framework applicable to claims allegi ng controlling stockholder obtained a non

- ratable benefit in a sale to an unaffiliated third party); In re Books

- A

- Million, Inc. S ’ holders Litig. , 2016 WL 5874974, at *8 (Del. Ch. Oct . 10, 2016) (applying MFW at motion to dismiss stage) , aff'd , 164 A.3d
56 (Del. 2017) ; Swomley v. Schlecht , C.A. No. 9355

- VCL at 64

– 79 (Del. Ch. Aug. 27, 2014) (TRANSCRIPT) (same), aff'd, 128 A.3d 992 (Del. 2015) (TABLE). Plaintiff here contends that Defendants have not satisfied the elements of
MFW ; it does not contend it is otherwise inapplicable. Plaintiff alleges that30 Defendants have failed to satisfy elements (ii) and (v) of the MFW framework. It argues that the Spec ial Committee was not independent and that the stockholder vote was uninformed . If it is reasonably conc eivable under the well

- pleaded facts of the Complaint and Supplement that either element is not satisfied, then D efendants will be unable to benefit fr om the deferential business judgment standard of review. Martha Stewart , 2017 WL 3568089, at *1. The co urt next considers Plaintiff’s arguments

. 1. Special Committee’s Independence Plaintiff’s challenge to the independence of the Special Committee is two

fo ld. First, Plaintiff impugns the independence of the Special Committee’s chair and argues she undermined the independence of the committee as a whole. Second, Plaintiff insists the Special Committee lacked independence because it labored under a “control led mindset , ” bending to Green’s wishes. The MFW framework contemplates that the Special Committee will a ct as an “independent negotiating agent whose work is subject to stockholder approval.” Flood v. Synutra Int'l, Inc. , 195 A.3d 754, 767 (Del. 2018) . To plead that a director is not independent “in a manner sufficient to challenge the [ MFW ] framework, a
p laintiff must allege facts supporting a reasonable inference that a director is sufficiently loyal to, beholden to, or otherwise influenced by an interested party so as to undermine the director’s ab ility to judge the matter on its merits.” Books

- A

-31 Millio n , 2016 WL 5874974, at *9; accord In re Dell Techs. Inc. Class V S ’ holders Litig. , 2020 WL 3096748, at *35 (Del. Ch. June 11, 2020). “The pleading standard that governs under Rule 12(b)(6) is less st ringent and more plaintiff friendly than the standard tha t governs under Rule 23.1.” Dell , 2020 WL 3096748, at *35. The Plaintiff need not plead facts supporting its allegations of conflict with particularity ; instead the question is whether the pleaded facts make it “reasonably conceivable” that the Special C ommittee members were not independent. Id. The Special Committee consisted of three members : Buyer, Rajaram, and Wells, 113 with Buyer serving as its chairperson. 114 “Directors are presumed to be
in dependent.” Friedman v. Dolan , 2015 WL 4040806, at *6 (Del . Ch. June 30, 2015). Plaintiff does not meaningfully challenge the independence of either Rajaram or Wells. The Complaint notes that both Rajaram and Wells served on the Company’s Compensation C ommittee and that, in December 2020, the Compensation Commi ttee was considering a stock option grant to Green. 115 Plaintiff views this as “demonstrating both their controlled mindset and their entrenchment

113 Compl. ¶ 67.
114 Pl.’s Ans. Br. 43.
115 Compl. ¶ 113.32 motive.” 116 A large option award, contingent on va rious stock achievements and vesting conditions over a ten

- ye ar period, was eventually approved by the Compensation Committee in October 2021

. 117 As noted earlier, this grant is not being challenged in this litigation and there are no allegations that Rajaram or Wells made any fiduciary decision concerning the option grant prior to October 2021

. The Complaint lacks well

- pleaded allegations creati ng a reasonable inference undermin ing their independence while serving on the Special Committee

. 118

116 Id. ¶ 17.
117 Supp. to Compl. ¶ 166.
118 Beyond his role on the committees, the only other allegation specific to Wells is the May 27, 2020 em ail he received from Green requesting a thirty

- minute conversation regarding “[s]omething . . . quite urgent and important.” Compl. ¶ 62. This allegatio n leads to a reasonable inference that the conversation occurred and that it concerned the Dilution Tr igger. When the conversation occurred i s unclear, but two days after sending this email, Green contacted the entire board to schedule a meeting about the Dilution Trigger

. Id. ¶ 63. That meeting occurred on June 3, 2020. Id. ¶ 66. Without more, the al legation that Green had a conversation about the Dilution Trigger with Wells does not create a reasonable inference that Wells was conflicted or lacked independence from Green. See In re MFW S ’ holders Litig. , 67 A.3d 496, 509 (Del. C h. 2013) (“[A] plainti ff seeking to show that a director was not independent must meet a materiality standard, under which the court must conclude that the director in question's material ties to the person whose proposal or actions she is evaluating are s ufficiently substantia l that she cannot objectively fulfill her fiduciary duties”) , aff'd sub nom. Kahn v. M & F Worldwide Corp. , 88 A.3d 635 (Del. 2014) . In In re Rouse Properties, Inc. , 2018 WL 1226015, at *14 (Del. Ch. Mar. 9, 2018), this court acknowl edged that conversatio ns between a controller and director regarding the director’s employment post

- merger may raise a reasonable doubt as to the director’s independence from the controller for that transaction. Plaintiff has not plead ed any allegations i n this case making it reasonable to infer that the substance of the conversation between Wells and Green involved such innately conflicting topics

.33 Plaintiff ’s challenge to the independence of the Special C ommittee focuses

s olely on the chair

— Buyer. D efendants argue that the allegations as to Buyer are meritless, but even if they had merit, the Complaint does not allege facts supporting a reasonable inference that a majority of the committee was not disinterested and indepen dent. Therefore, according to D efendants, Plaintiff has not alleged facts to call into question the independence of the Special Committee.

a. Compensation Plaintiff’s challenge to Buyer’s independence is limited to the compensation that she derived from TTD as a consultant in 2016, whe n she was not a director of the Company, and her director compensation in 2019 and 2020. 119 The main area of dispute is whether Buyer’s director compensation is material to her. In 2016, Green hired Buyer as a consultant for TT D’s IPO. 120 In return for
h er work on this project, Buyer received $175,000 and 2,500 options to acquire Class A stock. 121 As a director of the Company, she has received compensation of $535,558 in 2019 and $408,492 in 2020. 122 Plaintiff implies that this com pensation

119 Supp. to Compl. ¶ 196.
120 Id. ¶ 195.
121 Id.
122 Id. ¶ 196. Plaintiff’s brief notes that, in 2019, “Buyer’s co mpensation was $535,55 8 in 2019 and $408,492 in 2020, making her the Company’s highest

- paid director by a wide margin .” Pl.’s Ans. Br. 41 (emphasis added). In 2019, Buyer received the highest total compensation for a non

- employee director due to “an initial director equity aw ard [granted34 is material to Buyer , alleg ing that Buyer’s TTD director compensation is her only source of income besides what she earns from her consulting company , whose annual revenue is allegedly $244,223

. 123 The sole factual basis for this allegation is

an online

- reference to Dun & Bradstreet. 124 Defendants argue that the speculation of marketing companies such as Dun & Bradstreet regarding the revenue of private companies cannot satisfy Plaintiff’s pleading burden

. Buyer’s director questionnaire, cited by b oth parties, notes tha t “[s]ince August 2006, Ms. Buyer has served as principal of Class V Group, LLC, a consulting firm that advises companies on initial public offerings and other market strategies.” 125 Prior to Class V Group, LLC, Buyer served in a varie ty of hefty roles, in cluding as Director of Business Optimization at Google, General Partner of a venture capital firm, and Director of Internet/New Media Research at Credit Suisse First Boston. 126 Buyer also served as director of a publicly traded online s urvey company from 2004 until it was acquired by Microsoft. 127

to new director’s] upon initial election to our board.” 2020 Annual Proxy at 44

– 45. As shown in Plaintiff’s pleadings, Buyer was the only new director join the Board that year. Compl. ¶ 28. The following year, Buy er’s compensation was in l ine with that received by the other directors. 2021 Proxy at 46.
123 Supp. to Compl. ¶ 196.
124 Id.
125 Dkt. 64, Ex. 13 at TTD0000185.
126 Id. ; Supp. to Compl. ¶ 196 (noting that Buyer retired from Google in 2005).
127 Dkt. 64, Ex. 13 at TTD0000185.35 This court is hesitant to infer materiality of compensation absent well

- pleaded facts. The determination of whether a director’s com pensation from the Company is sufficient to raise a reason to doubt her independence is a fact intensive inquiry. See In re MFW S’holders Litig. , 67 A.3d at 510

– 13 (observing that a plaintiff must allege facts “showing that a specific director’s indepen dence is compromised by factors material to her” and that fees paid to a director are material to the director) ;

see also McElrath on behalf of Uber Techs., Inc. v. Kalanick , 2019 WL 1430210, at *17 (Del. Ch. Apr. 1, 2019) (“The materiality inquiry must fo cus on the financial circumstances or personal affinities of t he particular director in question.”) , a ff'd , 224 A.3d 982 (Del. 2020) ; Freedman v. Adams , 2012 WL 1345638, at *7 (Del. Ch. Mar. 30, 2012) (applying a materiality inquiry in the Rule 23.1 contex t and finding “with the facts as they are, the Plaintiff simpl y leaves the Court to speculate as to whether the Outside Directors ’ compensation so far exceeded what was customary that it was disabling. This argument fails.”); Chester Cnty. Empls

. ’ Ret. Fun d v. New Residential Inv. Corp. , 2017 WL 4461131, at *8 (Del. Ch. Oct. 6, 2017) (declining to infer, under a Rule 23.1 analysis, that compensation was material to certain directors when plaintiff pleaded that the one was retired and the other’s “employment background indicate[d] he ha[d] not accumulated great wealth. ”).36 Even under the more plaintiff

- friendly standard of the MFW framework, the plaintiff must still allege well

- plead ed facts supporting a reasonable conceivability of compensation materiality to the specific director. As t his court recently observed : Ge nerally, serving as a director on the board of a Delaware corporation is not a pro bono gig; Delaware law recognizes that directors will be paid a fair and reasonable amount. For that reason, wh en director fees are not excessive, mere allegations of paymen t of director fees are insufficient to create a reasonable doubt as to the director's independence. Simons v. Brookfield Asset Mgmt. Inc. , 2022 WL 223464, at *15 (Del. Ch. Jan. 21, 2022). Each side has cited cases supporting their respective position. 128 The court need not wade into the issue here. Even assuming that Buyer’s TTD compensation

128 In addition to taking issue with the Dun & Bradstreet estimate, the Special Committee argues that merely pointing to one’s director fees alone is not sufficient to create a reasonable inference that a director lacks independence or that it is the sole source of her in come. Dkt. 62 (“SC Opening Br.”) at 17 (citing In re Kraft Heinz Co. Deriv

. Litig. , 2021 WL 6012632, at *12 n.124 (Del. Ch. Dec. 15, 2021) (noting that a director’s publicly reported income does not always contextualize a directo r’s wealth), and Simons , 2 022 WL 223464, at *15 (noting that the fact that a director was retired and his directorship “is his sole source of current employment does not give rise to a reasonable inference that his [director] fees are material to him

. ”)). On the other hand, Plaint iff cites cases for the proposition that the court has inferred reason to doubt the independence of directors drawing fees that were much lower than what Buyer received in the last two years. Pl.’s Ans. Br. 43 (citing Del

. C nty. Empls

. Ret. Fund v. Sanche z , 124 A.3d 1017, 1020

– 21 (Del. 2015) (inferring at the pleading stage that director fees of $165,000 were material when they constituted 30% to 40% of the defendants’ total annual income); In re Oracle Corp. Deriv

. Litig. , 2 018 WL 1381331, at *177 (Del. C h. Mar. 19, 2018) (inferring at the pleading stage that director fees of $468,645 were material) ) ; see also Voigt , 2020 WL 614999, at *15 & n.14 (citing cases where director fees in amounts lower than what Buyer received were inferred as material at the pl eading stage, and observing that “[s]pecific information37 creates a reasonable inference that her director compensation was material to her and that she was, therefore, not independent, the Plaintiff has not alleged facts that create a reason to doubt that a majority of the committee lacked independence or that Buyer so dominated the committee process that it undermined its integrity as a whole.
b. Buyer’s Ef fect on the Committee As a general rule, outside the MFW framework, a plaintiff must plead facts supporting a reason to doubt the independence or disinterestedness of a majority of the board or a special committee. See , e.g. , Beam ex rel. Martha Stewart Living Omnimedia, Inc. , 845 A.2d 1040, 1046 n.8 (Del. 2004) (observin g that in considering whether demand is excused in a derivative action, demand is futile unless there is a majority of independent directors); Beneville v. York , 769 A.3d 80,
85

– 87 (Del. Ch. 2000) (holding that demand is excused where a board is evenly div ided between interested and disinterested directors). “Where

. . . a plaintiff alleges only a minority of special committee members are incapable of disinterestedly and independently con sidering a transaction, a plaintiff must proffer at the pleading stag e some factual predicate from which the court can infer the compromised director(s) somehow infected the special committee ’s process.” In re GGP, Inc. S’holder Litig. , 2021 WL 2102326, a t *15 (Del. Ch. May 25, 2021), aff'd

about the wealth of particular individuals is not generally available and is also not something that can usually be obtained using Section 220.”)

.38 in part, rev'd in part and reman ded , 2022 WL 2815820 (Del. July 19, 2022)

. 129 Although GGP did not involve the application of the MFW framework, t he Plaintiff here acknowledges that it must meet this burden. 130
Plainti ff argues that the court should infer that Buyer’s lack of independence “somehow infected the special committee’s process.” 131 Plaintiff relies on In re MAXXAM, Inc./Federated Dev elopment S hare holders Litigation , 1997 WL 187317,

129 For this propositio n, the GGP opinion from this co urt relied on numerous cases from this court and the Delaware Supreme Court. GGP , 2021 WL 2102326 at * 15 n.179 (citing Cede & Co. v. Technicolor, Inc. , 634 A.2d 345, 363 (Del. 1993) (“This Court has never held that one director's colorable interest in a c hallenged transaction is sufficient, without more, to deprive a board of the protection of the business judgment rule presumption of loyalty.”); In re Alloy, Inc. , 2011 WL 4863716, at *8

– 9 (Del. Ch. Oct. 13, 2011) (holdi ng that the allegation that an alleg edly conflicted corporate fiduciary “was in a position ” to influence other members of a special committee was inadequate to support an inference that the special committee's process was tainted by undue influence); Telxo n Corp. v. Meyerson , 802 A.2d 257, 2 64 (Del. 2002) (“Where only one director has an interest in a transaction, however, a plaintiff seeking to rebut the presumption of the business judgment rule under the duty of loyalty must show that the interested direc tor controls or dominates the board as a whole” (quotations omitted)).
130 Pl.’s Ans. Br. 43 (citing and partially quoting the foregoing sentence from GGP ). In AmTrust Financial Services, Inc. Stockholder Litigation , 2020 WL 914563 (Del. Ch. Feb. 26, 2020) , the plaintiffs contended that for MFW to apply all members of the special committee must have been disinterested and independent. Id . at *10 n.105. The AmTrust court did not need to reach that issue because the court concluded that a majority of the sp ecial committee had a material self

- interest in the transaction. Id . This court’s opinion in GGP acknowledged this seemingly open question of Delaware law, but did not need to reach it because GGP did not involve application of the MFW framework. The court does not need to reach that issu e here, either, because the Plaintiff did not address in its c omplaint or brief whether MFW can apply only if every member of the special committee is independent and disinterested. Accordingly, that argument was waived. See Emerald P'rs v. Berlin , 726 A .2d 1215, 1224 (Del. 1999) (“Issues not briefed are deemed wai ved.”)

. 131 Pl.’s Opening Br. 43 (quoting GGP , 2021 WL 2102326, at *15).39 at *1 (Del. Ch. Apr. 4, 1997), for the proposition that a non

- independent chair’s “dominant role” i n the special committee process “accentuates the Court’s concerns” regarding the independence of the committee as a whole. True enough, but
MAXXAM does not move the needle for Plaintiff in this case. In MAXXAM , the chair of the special committee dominate d negotiations of the challenged transaction, bore significant financial ties to the controller, and undermined the special committee process by selecting an d hiring advisors before obtaining the approval of the committee. Id. at *6, *20. Plaintiff does not plead anything close to those allegations here. The only well

- pleaded fact concerning Buyer’s individual conduct concerns the selection of Centerview as one of the Special Committee’s two advisors. Plaintiff contends that “Buyer pressed the Special C ommittee to hire Centerview as its advisor.” 132 This characterization is based on a single email with the subject line “For what it’s worth,” wherein Buyer i nformed the Special Committee: “I just received a strong recommendation on Centerview Partners (as a third option to PW and Moelis).” 133 In a follow up email, Buyer wrote, “Right on the web page, they talk about special committee advisory on this very top ic.” 134 None of this is

132 Pl.’s Ans. Br. 43 n.14.
133 Dkt. 64, Ex. 29.
134 Id.40 contained in the pleadings. The single footnote in a brief dedicated to this email does not create a reasonable inference that Buyer dominated the Special Committee or lacked independence. There is no allegation that Buyer unilate rally selected Centerview. Indeed, the only reasonable inference from the email is that she suggested Centerview as a third potential candidate to consider as a financial advisor and that the full Special Committee chose Centerview, a firm with relevant

e xperience to the Special Committee’s mission. That is what the meeting minutes reflect, and Plaintiff does not suggest otherwise. Buyer’s email to her fellow committee members does not support an inference that she dominated the Committee or steered it i n a direction under circumstances that undermined its independence. 135 Plaintiff has not pleaded suffici ent facts alleging that Buyer’s conduct dominated or subverted the Special Committee process so as render the entire committee defective, even if she was determined to be lacking in independence.

135 The MAXXAM case is further distinguishable from this action because, i n MAXXAM , the court found that “the members of the Special Committee all had significant financial and/or business ties with [the controller].” Id. at *20 (emphasis added) . Therefore, in MAXXAM , the court had several reasons for ultimately finding the sp ecial co mmittee’s process “infected.”41 c. Controlled Mindset In its final effort to undermine the Sp ecial Committee, Plaintiff argues that the committee “labored under a controlled mindset and knew that securing Green’s control would ingratiate themselv es with Green and ensure their continued directorships at the Green

- controlled Company.” 136 D efendants h ave framed this issue as a further challenge to the committee’s independence. 137 Plaintiff insists that its challenge goes beyond the independence of th e Special Committee. 138 Regardless of how the argument is framed, it is without merit. The “controlled min dset” principle has been applied where, “from inception, the Special Committee fell victim to a controlled mindset and allowed [the controller] to dictate the terms and structure of the [transaction].” In re S. Peru Copper Corp. S'holder Deriv

. Litig. , 52 A.3d 761, 798 (Del. Ch. 2011), aff'd sub nom. Americas Mining Corp. v. Theriault , 51 A.3d 1213 (Del. 2012). “When analyzing director independence in the presence of a controlling stockholder, ‘the focus . . . is on domination of the board with regard to the transaction at issue.’” In
re Viacom Inc. S ’ holders Litig. , 2020 WL 7711128, at *23 (Del. Ch. Dec. 29, 2020), as corrected (Dec. 30, 2020) (citation omitted).

136 Compl. ¶ 112.
137 See Green’s Opening Br. 51; SC Opening Br. 12

– 22.
138 See Hrg. Tr. at 68.42 Plaintiff’s “controlled mindset” assertion is not supported by any well

- pleaded allegations that the Special Committee members we re beholden to Green or that they suffered from any disabling personal interest in the Dilution Trigger Amendment. Rather, Plaintiff insists the Special Committee’s lack of independence is sel f

- evident because it decid ed to maintain the dual

- class structure: “[N]o independent fiduciaries acting in good faith would take affirmative action to perpetuate a dual class structure when the company and minority investors have an imminent opportunity t o eliminate a super

- voting class of stock.” 139 This ipse dixit does not carry the day. Merely because the committee recommended that the Board and stockholders vote to maintain the dual

- class structure, albeit in modified fashion, does not render them lack ing in independence. As th is court has emphasized : A director could believe in good faith that it is generally optimal for companies to be controlled by their founders and that this governance structure is value

- maximizing for the corporation and its stoc kholders over the long

- term . Others might differ. As long as an otherwise independent and disinterested director has a rational basis for her belief, that director is entitled (indeed obligated) to make decisions in good faith based on what she subjectivel y believes will maximize th e long

term value of the corporation for the ultimate benefit of its residual claimants.

139 Compl. ¶ 2.43 United Food & Commercial Workers Union & Participating Food Indus. Empls.
Tri

- State Pension Fund v. Zuckerberg, 250 A.3d 862, 895 (Del. Ch. 2020), aff'd,
2021 WL 4344 361 (Del. Sept. 23, 2021). Plaintiff ’s controlled mindset theory relies on two cases that did not involve

an MFW analysis

. Neither case is remotely applicable to the facts of this case. In Berteau v. Glazek , 2021 WL 2711678, at *12 (Del. Ch. June 30, 202 1) , th is court held that a merger between a controlling stockholder and a subsidiary was subject to entire fairness review. In holding that the complaint stated non

- exculpated claims against the two special committee members of the subsidiary, the court f ocused on the unique facts of that case, including: (1) the committee allowed management to select its legal advisor, which had also advised the full board; (2) the committee inexplicably did not push back on the controlling sto ckholder after it had first agreed to a majority

- of

- the

- minority vote, but then reneged; and (3) the special committee provided the full board, including conflicted dual

- fiduciaries, an “update” on its negotiations, at a meeting that appears to have been a pressure tactic, after whi ch price negotiations abruptly ended. Id. at *22

– 24. Viacom also involved a controlling stockholder interfering with a special committee’s process. 2020 WL 7711128, at *2. In that case, the court concluded that the Viacom special committee members

were conflicted because they had close personal relationships wit h the principals of the controller, the controller was known to be retributive and to remove directors44 that disagreed with its approach, and the committee members acted with a “controlled mindset ” where the committee members were hand

- picked by the control ler after “disloyal” members were removed

. Id. at *21

– 23. In addition , the committee refused to push back on CBS’s refusal to condition the deal on a majority of the minority vote, the committe e members refused to obtain any minority protections, and the controller dominated the committee’s negotiation strategy. Id. at *2 2

– 23; see also CBS , 2021 WL 268779, at *40 (finding it “inexplicable” that a special committee did not attempt to secure a ma jority

- of

- the

- minority vote after the controller indicated it would not agree to such a condition). Plaintiff here offers no comparable allegations impugning the TTD Special Committee members or their process. There are no allegations that Green sought to interfere with or pressure the committee. At bottom, Plaint iff’s challenge to the Special Committee is grounded in Plaintiff’s belief that maintaining the dual

- class structure through the Dilution Trigger Amendment was a bad deal for TTD stockholders. M aybe it was. But the Delaware Supreme Court has clarified th at this court’s role in applying the MFW framework is limited to a process analysis, not second guessing the ultimate “give” and “get”: “To lard on to the due care review a substantive review of the economic fairness of the deal approved by a Special
Comm ittee, as the plaintiff advocates, is to import improperly into a due care45 analysis the type of scrutiny used in entire fairness review and in appraisal cases.” Synutra , 195 A.3d at 756. At thei r core, Plaintiff ’s allegations do not substantively challeng e the Special Committee’s independence. Instead, they infer wrongdoing from business judgment decisions. As our Supreme Court confirmed in Synutra , “Disagreeing with the special committee’s str ategy is not a duty of care violation.” Synutra , 195 A.3d at 768 (citing Swomley v. Schlecht , 2014 WL 4470947, at *21, aff'd , 128 A.3d 992 (Del. 2015)) (quotation marks and brackets omitted). To state a claim against the Special Committee for a duty of c are violation in negotiating the Dilution Trigger Amendment, they must plead facts showing that the Special Committee acted with “gross negligence.” Id. They have failed to do so here. Accordingly, it is not reasonably conceivable under the well

- pleaded allegations in the Complaint or Supplement that the Special Committee lacked independence or failed to satisfy its duty of care.
2. The Stockholder Vote Plaintiff also alleges that the stockholder vot e on the Dilution Trigger Amendment was uninformed , thus r endering MFW inapplicable

. 140 Plaintiff insists there were six material disclosure deficiencies in the 2020 Special Proxy. The y can

140 Compl. ¶ 121.46 be summarized as the failure to disclose : (i) Green’s desire to sell Class B stock ; (ii) the Company’s expectations as to w hen the Dilution Trigger wo uld likely be tripped ; (iii) advice that Centerview provided to the Special Committee; (iv) Green’s

c ounsel’s acknowledgement that a business rationale would be needed to justify any amendment to the Dilution Trigger ; (v) the Spe cial Committee’s efforts to obtain stockholder support for the Dilution Trigger Amendment ; and (vi) the Compensation Committee’s consideration of an equity grant to Green in December 2020

. 141 According to Plaintiff, each of these material omissions rendered the stockholder s uninformed , depriving them of the ability adequately to asse ss the transaction’s fairness. The analysis here turns on the “well

- recognized proposition that directors of Delaware corporations are under a fiduciary duty to disclose fully and fairly all

m aterial information within the board ’ s control when it seeks shareholder action.” Stroud v. Grace , 606 A.2d 75, 84 (Del. 1992). An omitted fact is material if there is a substantial likelihood that a reasonable shareholder would consider it important in deciding how to vote

. . . Put another way, there must be a substantial likelihood that the disclosure of the omitted fact would have been viewed by the reasonable investor as having significantly altered the “ total mix ” of information mad e available.

141 Id. ¶¶ 122

– 27; Supp. to Compl. ¶ 161.47 Rosenblatt v. Getty Oil Co. , 493 A.2d 929, 944 (Del. 1985) (quoting TSC Indus., Inc. v. Northway, Inc ., 426 U.S. 438, 449 (1976)); accord Arnold v. Soc'y for Sav. Bancorp, Inc. , 650 A.2d 1270, 1277 (Del. 1994)

. The question of materiality is a “context

- specific inquiry.” Dell , 2020 WL 3096748, at *39 (citation omitted). “So long as the proxy statement , viewed in its entirety, sufficiently discloses and explains the matter to be voted on, the omission or inclusi on of a particular fact is gen erally left to management’s business judgment.” In re 3Com S’holders Litig. , 2009 WL 5173804, at *1 (Del. Ch. Dec. 18, 2009). For the reasons stated below, the six alleged omissions , individually and collectively, d id not res ult in an uninformed stockhold er vote on the Dilution Trigger Amendment

.

a. Green’s Desire to Sell Class B Shares Plaintiff argues the stockholder vote was uninformed because the proxy did not disclose “Green’s weak bargaining position.” 142 According to Plai ntiff, “during the spring of 20 20 Green was desperate to sell a significant portion of this Trade Desk equity,” but could not do so without tripping the Dilution Trigger and thus losing majority control over the Company. 143 Plaintiff contends that this inf ormation

142 Pl.’s Ans. Br. 52.
143 Compl. ¶ 122.48 was material because “i t reveals that the Special Committee should have had substantial negotiating leverage against Green and could have negotiated for a dramatically more stockholder

- friendly Dilution Trigger Amendment and/or other concessions f rom Green. ” 144
Plaintiff anchor s this allegation to an email from Toth to Green on May 23, 2020, which was around the time that Green learned the Dilution Trigger could be tripped in a matter of months if he continued to sell Class B shares. Toth’s emai l stated, in pertinent part : “We may have more leverage that we think. Externally no one knows you want to sell shares.” 145 Plaintiff point s to this email, Green’s recent sale of approximately 283,000 shares the prior week , and his subsequent sale of shares after approval of the Dilution Trigger Amendment as evidence of Green’s dire need for liquidity, which, if known to the Special Committee, could have led to a better deal for stockholders. 146
D efendants contend that this allegation is conclusory and immaterial. Plaintiff alleges no fac ts supporting a reasonable inference that Green had a desperate need for liquidity. There are no allegations that he required cash for any immediate

144 Id . ¶ 123.
145 Id

. ¶¶ 7, 49.
146 Notably, the Plaintiff does not allege that the stockholder vote was uninformed due to the failure to disclose Green’s initiation of the process to amend the TTD Certificate to remove the Dilution Trigger

.49 investment o r looming debt. The week before Toth’s email, Green had sold TTD stock for proceeds of around $80 million. 147 The stockholder vote on the Dilution Trigger Amendment was not held until six months later, and there is no allegation of Green’s having pressure d the Special Committee to accelerate the process or that he was in dire need for liquidity.
G reen ’s email to Wells, seeking to discuss a “quite urgent and important” issue does not support a reasonable inference that Green had a desperate need for liquid ity. Instead, it demonstrates that Green feared that he could lose control in the relatively n ear future due to the tripping of the Dilution Trigger , either as a result of his own continued disposition of Class B stock

— which he had just ceased

— the

147 The Complaint alleges Green initial ly sought to convert and sell 282,906 Class B shares, but then settled the trade by converting and selling approximately 125,764 Class B shares, with the remainder consisting of preexisting Class A shares. See Compl. ¶¶ 55, 59. According to a Form 4 file d with the SEC on May 20, 2020, Green converted 282,906 Class B shares into Class A shares between May 18 and 20, 2020 and sold them during that period at prices between $301 and $311 per share. The Trade Desk, Inc., Statement of Changes in Beneficial Own ership (Form 4) (May 20, 2020). In an amended Form 4, Green reported that instead of converting 254,883 Class B shares on May 18, 2020, he converted only 125,764 Class B shares. The Trade Desk, Inc., Statement of Changes in Beneficial Ownership (Form 4/A ) (June 12, 2020). The court take s judicial notice of these Form 4s and these stock sales. See Hughes , 897 A.2d at 170 (“This Court has recognized that, in acting on a Rule 12(b)(6) motion to dismiss, trial courts may consider hearsay in SEC filings to a scertain facts appropriate for judicial notice under [Delaware Rule of Evidence] 201.” (internal quotations omitted)); Parseghian v. Frequency Therapeutics, Inc. , 2022 WL 2208899, n.45 (Del. Ch. June 21, 2022) (taking judicial notice of SEC Form 4 reflecti ng a director’s stock holdings); In re Primedia, Inc. S ’ holders Litig. , 2013 WL 6797114, at *11 (Del. Ch. Dec. 20, 2013) (taking judicial notice of SEC Form 4s for purposes of establishing the dates of stock purchases).50 Company ’s issuance of additional Class A stock , or the exercise of Class A options by others.
Green’s desire to sell TTD stock would not have significantly altered the total mix of information available to stockholders when deciding how to vote on the Dilution T rigger Amendment. Arnold , 650 A.2d at 1277. The purpose of the Dilution Trigger Amendment was to maintain the existence of the high

- vote Class B stock (98% owned by Green) without an automatic conversion to Class A upon the Class B falling below the 10% threshold. The obvious effect of the amendment was that Green could dispose of Class B shares without risk of causing the automatic conversion of his remaining Class B shares. 148
The 2020 Special Proxy disclosed that the Class B stock represented only
10. 7% of the total stock outstanding, i.e. , 0.07% above the Dilution Trigger

. 149 It also disclosed t hat the Dilution Trigger could be reached as early as March 2021. 150 Plaintiff does not dispute that the 2020 Special Proxy disclosed that Green proposed the D ilution Trigger Amendment. The amendment would have been unnecessary if it was not likely to be t riggered in the near term, either due to the conversion and

148 Green also beneficially owned 138, 289 shares of Class A stock. 2020 Special Proxy at 34.
149 2020 Special Proxy at 2 (“On the record date, there were 41,947,749 shares of our Class A common stock outstanding and 5,015,339 shares of our Class B common stock outstanding.”).
150 Id. at 13.51 sale of Class B stock by Green and other holders of Class B, the Company’s issuance of Class A sto ck, or the exercise of options for Class A stock held by employees and other option holders. Plai ntiff likens the failure to disclose Green’s supposed desperate need for liquidity to the non - disclosure of the infamous Arledge and Chitiea report in Weinberger v. UOP, Inc. , 457 A.2d 701, 703 (Del. 1985). The analogy fails. Weinberger involved a contro lling stockholder (Signal Companies , Inc. ) acquiring the remaining shares of UOP that it did not already own in a long

- form cash

- out merger . Signal had placed seven of the 13 directors on the UOP board. Id.

at 704. Two of them , Charles Arledge and Andre w Chitiea, also served on the Signal board. Id. at 705. Arledge and Chitiea performed a study using information obtained from U OP that determined it would be in Signal’s interest to acquire the remaining UOP stock for anything under $24 per share. Id. The Signal board decided to offer between $20

– $21 per share and never disclosed the Arledge

- Chitiea report. Id. at 707. The Del aware Supreme Court concluded that Signal’s withholding of the Arledge

- Chitiea report from the UOP board and its stockholders i ndicated a lack of fair dealing. Id. at 711

. Even crediting the Complaint’s allegation of Green’s dire liquidity need as
more t han speculative, it is not comparable to the Arledge

- Chitiea report. The Arledge

- Chitiea report was prepared by two conflicted directors using UOP52 information obtained solely in their capacities as UOP directors. Id. at 705. Here, Green’s purported need for liquidity was not based on Company information that was secretly withheld from the other directors. Instead, it was, at b est, Green’s subjective motivation for proposing the Dilution Trigger Amendment. See Rabkin v. Olin Corp. , 1990 WL 47648, at *10 (Del. Ch. Apr. 17, 1990) (rejecting analogy
to Weinberger where the complaint failed to allege that undisclosed information

co ntained sensitive company data as did the Arledge

- Chitiea document), aff’d , 586 A.2d 1202 (Del. 1990) (TAB LE); see also , e.g. , Herd v. Major Realty Corp. , 1990 WL 212307, at *10 (Del. Ch. Dec. 21, 1990) ( “the general rule is that alleged motives need not b e disclosed” ); In re MONY Grp., Inc. S’holder Litig. , 853 A.2d 661, 682 (Del. Ch. 2004) (directors’ “subje ctive motivation or opinions are not per se material, as long as the Board fully and accurately discloses the facts material to the transaction”).
As Defendants aptly put it, “anyone reading the Proxy would understand both that Green desired to retain control through the Trigger Amendment and that the amendment would enable him to continue his (disclosed) historical practice of selling shares without l osing that control.” 151 The omission of Green’s desire to sell

151 Gre en’s Opening Br. 38. Green’s disposition of TTD stock is reflected in Form 4s filed with the SEC , of which the court can take judicial notice. See Hughes , 897 A.2d at 170

.53 TTD stock did not render the stoc kholder vote on the Dilution Trigger Amendment uninformed.
b. The Estimated Dilution Trigger Date Plaintiff contends that the 2020 Special Proxy “misleadingly discl osed that ‘the Dilution Trigger could occur as early as March 2021’ and suggested that any

cros sing of the threshold was uncertain and could be delayed far longer (even by years).” 152 The 2020 Special Proxy ’s disclosures on this topic were neither misleadin g nor false. “[A]s a general rule, proxy materials are not required to state

‘ opinions or possibilities, legal theories or plaintiff’s characterization of the facts. ’ ”
MONY , 853 A.2d at 682 ( quoting Seib ert v. Harper & Row, Publ ’ rs, Inc. , 1984 WL 21874, at *6 (Del. Ch. Dec. 5, 1984) ). The 2020 Special Proxy identified the current number of shares outstanding as of the record date. 153 It also disclosed, in conjunction with an illustrative stock ownership chart, that “there ha [d] been a significant change i n the ownership of [the Company’s] Class B common stock in a relatively short time since [the Company’s] initial public offering.” 154 It stated that the Dilution Trigger could be tripped “as early as Marc h 2021.” 155 Most important,

152 Compl. ¶ 124.
153 2020 Special Proxy at 2

. 154 Id. at 13.
155 Id.54 the 2020 Special Proxy exp lained that the Company could not definitively predict or control when the Dilution Trigger would be tripped: Under our current governance structure, our board of directors does not control the occurrence of the Triggering Events (as defined in Proposal O ne) that will result in the elimination of our dual class capital structure. The timing of the Dilution Trigger, for example, will vary widely depending on various factors. Our board of directors can influence the Dilution Trigger through issuances of Clas s A common stock, but the occurrence of the Triggering Events is largely outside of our board of directors’ control because conversion of the Class B common stock has the most significant effect on the Dilution Trigger. 156 The Plaintiff does not allege any inaccuracies in this disclosure. The Dilution Trigger date was not knowable due to the factors identified in the 2020 Special Proxy. The Plaintiff does not allege material information that wa s withheld from the Proxy. See Weiss v. Rockwell Int ’ l Corp. , 1989 WL 80345, at *7 (Del. Ch. July 19, 1989), aff'd , 574 A.2d 264 (Del. 1990) (finding that defendants “were not required to add their subjective opinion as to whether that particular [stock

s ale] scenario (over which they had no control) would or would not occur,” especially when “the possible scenario and its likely effect were in fact disclosed”); see also Shaev v. Adkerson , 2015 WL 5882942, at *10 (Del. Ch. Oct. 5, 2015) (“[N]ot only is Pla intiffs desired disclosure immaterial, but it might have been inappropriate to include in the proxy materials such a speculative conclusion.”). The

156 Id. at 20.55 Board was not obligated to provide additional possibilities , opinions, or characterizations as to a Dilutio n Trigger date that it did not have

. MONY, 853 A.2d
at 682

. Therefore, t he Complaint does not contain any well

- pleaded allegations rendering the Proxy’s disclosure on th e estimated Dilution Trigger date materially misleading or incomplete

.

c. The Centerview Slide Plaintiff asserts that the 2020 Special Proxy “fail[ed] to disclose a fair summary of Centerview’s advice and recommendations to the Special Committee.” 157 This argument is focused on one slide of a presentation. On July 2, 2020, shortly after being retained as financial advisor to the Special Committee,
Cente rview provided a “Preliminary and Confidential” presentation regarding a potential amendment to the Dilution Trigger. 158 Th e presentation contained a slide identifying “Potential Leve rs,” including “Goodwill,” “Economic Considerations,” and “Governance Ince ntives.” 159 Economic C onsideration s reflected in the slide included “‘Sunset Provisions’” which provided the “Least Value” and “Financial Incentive” which provided the “Most Value,” “based upon precedent control

157 Compl

. ¶ 125.
158 Dkt. 64, Ex. 32.
159 Id. at TTD0000381.56 extension.” 160 Plaintiff claims that “[t]his i nformation is particularly material ” because the Dilution Trigger Amendment failed to provide the Company’s stockholders with economic consideration. 161 Defendants argue that they were not required to disclose all preliminary guidance that the Special Commit tee received from its a dvisors and Plaintiff cites no authority to support such an obligation

. Defendants also note that this case does not involve a merger where the committee obtained and relied on a financial advisor’s fairness opinion and underlying v aluation analysis. See In re Pure Res., Inc., S ’ holders Litig. , 808 A.2d 421, 449 (Del. Ch. 2002) (holding that “stockholders are entitled to a fair summary of the substantive work performed by the investment bankers upon whose advice the recommendations of their board as to how to vo te on a merger or tender rely”). That distinction, which the Plaintiff does not address, is a meaningful one. But the court need not decide the pending motion s on that basis

. T he court is not persuaded under the facts of th is case that a single Centervi ew slide, containing generalized information regarding what stockholders might find more appealing in considering a proposal to extend a dual

- class structure was material information.

160 Id.
161 Compl. ¶ 125.57 The 2020 Special Proxy described the ter ms of the proposals and
counte rproposals between Green and the Special Committee. None of the proposals or counterproposals contained economic terms , such as Green surrendering stock or the Company making a payment to unaffiliated stockholders . Stockhold ers were able to assess for th emselves whether the deal struck by the Special Committee was in the best interests of the stockholders and the Company. The additional disclosure that the Special Committee could have demanded economic consideration, but did not do so, would have been obvious to any reasonable stockholder reading the 2020 Special Proxy. The omission of information contained in one slide of Cen terview’s preliminary presentation mentioning that financial incentives provide the most value does not render the stockholder vote on the Dilution Trigger Amendment uninformed.
d. The Business Rationale Plaintiff next argues the 2020 Special Proxy should hav e disclose d that Green’s counsel told the Special Committee “on multiple occasions” that Green would be providing a “business rationale” for the Dilution Trigger Amendment. 162 A rational business purpose serves as the foundation to the business judgment ru le. Unocal Corp. v. Mesa Petroleum Co. , 493 A.2d 946, 954 (Del. 1985). Green’s

162 Compl. ¶ 126.58 acknowledgement of t he need for a business rationale to justify eliminating the Dilution Trigger is not a material fact, but an ordinary course of proper fiduciary conduct.
Pl aintiff argues that Green’s acknowledgement that a business rationale was needed shows that there was none and that stockholders should have been so informed. 163 That is not a reasonable inference from the facts alleged in the Complaint. As the Plaintiff alleges, proxy advisory services such as ISS generally do not support dual

- class structures. 164 The com munication from Green’s counsel to the Special Committee’s counsel merely confirmed t hat Green needed to make his case to the Special Committee that repealing the Dilution Trigger was justified and that the rational e for the amendment was sufficie nt to per suade a majority of the unaffiliated stockholders to vote for it. The 2020 Special Proxy included Green’s August 3, 2020 letter to the Special Committee explaining his rationale for the Initial Green Proposal to eliminate the Dilution Trigger

. 165 The 2020 Special Proxy also disclosed the Special Committee’s reasons for approving the amendment. 166 Although Plaintiff challenges the

163 Compl. ¶ 126.
164 Id. ¶ 73.
165 2020 Special Proxy at D

- 1.
166 Id. at “LETTER FROM THE SPECIAL COMMITTEE.”59 legitimacy of the Special Committee’s support for extending Green’s ability to control the Company, Delaware law does n ot render t he committee’s position per se illegitimate

. See Zuckerberg , 250 A.3d at 895 (“As long as an otherwise independent and disinterested director has a rational basis for her belief [that it is optimal for the company to be controlled by its founde r], that di rector is entitled (indeed obligated) to make decisions in good faith based on what she subjectively believes will maximize the long

- term value of the corporation for the ultimate benefit of its residual claimants.”). The TTD stockholders were f ully capabl e of assessing the bona fides of Green’s and the Special Committee’s fully disclosed rationales and assessing whether the terms of the transaction were worthy of the stockholders’ support. Green’s counsel’s recognition that a proposal to elimin ate the Dil ution Trigger needed a business rationale was not material in light of the disclosures taken as a whole

. See Crane , 2017 WL 7053964, at *13 (“[D]irectors are ‘not required to disclose all available information,’ but only that information necessary to make the disclosure of their recommendation materially accurate and complete.”).

e. The Special Committee’s Marshalling of Stockholder Support Plaintiff contends that the 2020 Special Proxy wrongfully failed to disclose that the Special Committee “actively work ed to get significant Trade Desk60 stockholders” to vote “yes” on the Dilution Trigger Amendment. 167 Plaintiff infer s that this marshaling of support “reveals” the Special Committee’s intent to “override the will of the Company’s public stockholders.” 168
This a llegation lacks merit. Notably, t his argument focuses on events occurring after the issuance of the 2020 Special Proxy. Thus, if the Special Committee’s efforts to obtain sufficient votes needed to be disclos ed , it would necessarily have required a proxy supplement. 169 To that end , the Company filed supplemental proxy materials with the SEC on December 7, 2020 explaining: “ The special meeting was adjourned to allow the Company additional time to solicit votes in favor of the proposals to be acted on by st ockholders at the meeting.” 170 Plaintiff does not allege that the supplemental proxy materials were false or misleading

. Nor does Plaintiff attempt to argue that further disclosure specifically identifying the Special Committee as among those garnering vot es for the proposal would have

167 Compl. ¶ 127.
168 Id.
169 The Delaware Supreme Court has summarized a fiduciary’s duty to supplement its disclosure as follows: “[S]ubsequent events may have significance, and thus require disclosure, only as they relate to information originally disclosed. If subsequent events impart a new and significant sla nt on infor mation already discussed, their disclosure is mandated. If the subsequent event is tentative, ill defined or adds little to material already disclosed, the duty of fresh disclosure is limited.” Kahn v. Household Acq

. Corp. , 591 A.2d 166, 171 ( Del. 1991). Plaintiff does not address this standard or attempt to meet it.
170 The Trade Desk, Inc., Schedule 14A (Dec. 7, 2020).61 “significantly altered the ‘total mix’ of information made available ” to TTD’s stockholders. Arnold , 650 A.2d at 1277. Plaintiff also ignores that the Board was fully within its authority to adjourn the meeting to obtain the requisite votes to approve the Dilution Trigger Amendment. The 2020 Special Proxy included a prop osal for stockholder “[a]pproval of one or more adjournments of the Special Meeting, if necessary, to solicit additional proxies if there are insufficient vo tes at the time of the Special Meeting to approve any of the proposals to be considered at the meet ing.” 171 At the December 7 , 2020 meeting, a majority of the stockholder votes cast approved this adjournment proposal. 172 Therefore, the Board possessed the le gal authority to do

so. Delaware law does not require that directors remain neutral regarding the matters they propose for stockholder action. Mercier v. Inter

- Tel (Del

. ), Inc. , 929 A.2d 786, 808

– 09 (Del. Ch. 2007) ( “As a matter of fiduciary duty, directo rs should not be advising stockholders to vote for transactions . . . unless the directors believe those measures are in the stockholders' best interests. And when directors believe that measures are in the stockhold ers' best interests, they have a fiduci ary duty to

171 2020 Special Proxy at 6.
172 See The Trade Desk, Inc., Form 8

- K Amendment No. 1 (Dec. 10, 2020) at Item 5.07 (69,932,843 cast “for” the p roposal, 7,373,591 votes cast “against,” and 88,030 votes abstained).62 pursue the implementation of those measures in an efficient fashion.” )

. In fact, the law provides directors with broad authority to expend company resources garnering support for proposals that they have deemed to be in the best interest s of t he
company. MONY , 853 A.2d at 675 ( “ Directors can spend the corporation's money on printing and distributing a proxy statement explaining their judgment as to the benefits of the merger proposal. The[y] can retain ex perts to solicit proxies and publicize their views. They can hire lawyers and other advisors to defend their actions in court or in front of administrative or legislative bodies.”)

. The Special Committee’s efforts to obtain sufficient votes to approve the Dilution Trigger Amendment was not a f act that required supplemental disclosure

. f. The Compensation Committee’s Consideration of an Equity Grant to Green in December 2020 Finally, Plaintiff complains that the Company’s stockholders were not informed that th e Company’s Compensation Committee met on December 3, 2020 to consider issuing Green a “ mega [stock option] grant” (the “Contemplated Green Award”). 173 A t this meeting, the Compensation Committee “considered . . . granting options to Green amounting to 5% of the Company’s equity.” 174 There is no allegation that the Compensation Committee took any action at this meeting or at

173 Supp. to Compl. ¶ 161.
174 Id. ¶ 160.63 any time prior to October 2021 concerning this potential option grant. Plaintiff admits that, at the time of filing its Complaint, the Board had not yet approved any such gra nt. 175 Indeed, a n option s grant was not awarded to Green until October 6, 2021, a full 10 months after the Compensation Committee meeting that forms the basis for this disclosure claim. 176
Plaintiff nonetheless argues that knowledge of the contents of the
C ompensation Committee’s December 3, 2020 meeting would have materially altered the total mix of information provided to stockholders deciding how to vote on the Dilution Trigger Amendment: “ H ad Trade Desk stockholders known that the Board and Compensation Committee were strongly considering the near

- term bestowal of a windfall on Gr een, stockholders may have decided to vote against the perpetuation of control. ” 177 The 2021 Special Proxy was filed with the SEC on October 27, 2021, over a month before the Com pensation Committee’s December 3 meeting wherein they discussed the Contemplat ed Green Award

. Given this timing, any disclosure regarding the meeting would have necessarily been a supplement to the 2021 Special Proxy. As explained by the Delaware Supreme Court, the Board bears a duty to

175 Compl. ¶ 19.
176 Supp. to Compl. ¶ 166.
177 Id. ¶ 161.64 supplement its disclosure only when “subsequ ent events impart a new and significant slant on information already discussed.” Household , 591 A.2d at 171. In December 2020 , the TTD stockholders were being asked to vote on the continuation of its existing governance structure, i.e. the dual

- class stock structure, which enabled its founder to retain voting control of the Company. 178 The Contemplated Green Award was not one of the proposals presented to the stockholders for th eir vote in December 2020 . In fact, t he Contemplated Green Award was entirely speculative at the time the adjourned and reconvened stockholder meeting s w ere held

. 179 “Delaware law does not require disclos ure of inherently unreliable or speculative informat ion which would tend to confuse stockholders.” Arnold , 650 A.2d at 1280; accord Crane , 2017 WL 7053964, at *13 ; see also In re Columbia Pipeline Gp., Inc. , 2017 WL 898382, at *5 (Del. Ch. Mar. 7, 2017) ( “As a matter of Delaware law, a board does not have a fiduciary obligation to disclose preliminary discussions, much less an analysis of preliminary discussions.”). Plaintiff’s argument that disclosure of a potential large equity grant was required because it was being considered as an “alternative to the then

- uncertain

178 Compl. ¶ 86; 2020 Special Proxy at Appendix D

- 1.
179 Supp. to Compl. ¶ 160 (“The Compensation C ommittee considered , as of its December 3, 2020 meeting, granting options to Green”) (emphasis added); Id. ¶ 161 (“the Board and Compensation Committee were stron gly considering the near

- term bestowal of a windfall on Green”) (emphasis added)

.65 Trigger Amendment” 180 is equally unpersuasive. See In re 3Com , 2009 WL 5173804, at *6 (“Delaware law does not require management to discuss the panopl y of possible alternatives to the course of action it is proposing.” (internal quotations

om itted)); accord Crane , 2017 WL 7053964, at *13. Plaintiff has failed to explain how a reasonable shareholder would have considered the Compensation Committee’s preliminary consideration of an option grant to its CEO on December 3, 2020 “ important in decidi ng how to vote” o n the Dilution Trigger Amendment

. Rosenblatt , 493 A.2d at 944; s ee Household , 591 A.2d at 171 (holding supplemental disclosure not required about an agreement that was not definitive); In re Vaxart, Inc. S’holder Litig. , 2022 WL 1837452 , at *15

– 19 (Del. Ch. June 3, 2022) ( holding that the company’s selection to partici pate in a government

- funded research program that was subject to further negotiation was not material information requiring supplement al disclosure)

. Therefore, Plaintiff ha s failed to allege facts to support a reasonable inference that the failure to disc lose preliminary discussions regarding the Contemplated Green Award rendered the stockholders ’ vote on the Dilution Trigger Amendment uninformed.

* * *

180 Pl.’s An s. Br. 66 (emphasis omitted).66 Plaintiff has failed to plead facts sufficient to challenge the application of the
MFW framework. “Thus, the [Dilution Trigger Amendment] is subject to the business judgment rule.” Crane , 2017 WL 7053964, at *21. Under the version of the business judgme nt rule earned by pro per implementation of the MFW framework, only a well

- pleaded claim for waste may survive. Dell , 2020 WL 3096748, at *14. Plaintiff has not pleaded a claim for waste and has made no effort to overcome the business judgment rule

. III. CON CLUSION For the foreg oing reasons, the D efendants’ Motion s to Dismiss are GRANTED , and the Complaint is dismissed with prejudice

. IT IS SO ORDERED.