ATG Capital Opportunities Fund LP v. Ryan Lane

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE ATG CAPITAL OPPORTUNITIES ) FUND LP, ) Plaintiff, ) ) v. ) C.A. No. 2026-0447-LWW ) RYAN LANE, JOHN KIM, ) JONATHAN P. FOSTER, ADRIAN ) SOLGAARD, ÖRN ÓLASON, ) ROHAN CHAUHAN, MATTHEW ) HOMER, IAN READ, ) ) Defendants, ) ) and ) ) EMPERY DIGITAL, INC. ) ) Nominal Defendant. ) MEMORANDUM OPINION Date Submitted: August 19, 2026 Date Decided: August 28, 2026 A. Thompson Bayliss, John M. Seaman, Caitlin C. Bozman, Bryan M. Blaylock, ABRAMS & BAYLISS LLP, Wilmington, Delaware; Adrienne M. Ward, Lori Marks-Esterman, Jacqueline Y. Ma, Daniel M. Stone, Joseph M. Calder, Jr., OLSHAN FROME WOLOSKY LLP, New York, New York; Attorneys for Plaintiff ATG Capital Opportunities Fund LP John P. DiTomo, Jacob M. Perrone, Nicholas R. Gottemoller, MORRIS NICHOLS ARSHT & TUNNELL LLP, Wilmington, Delaware; David Livshiz, Andrew Gladstein, Nicholas Caselli, Alexandra Carlton, Penina Cohen, Jordan McGuffee, FRESHFIELDS US LLP, New York, New York; Attorneys for Defendants Ryan Lane, John Kim, Jonathan P. Foster, Adrian Solgaard, Örn Ólason, Rohan Chauhan, Matthew Homer and Ian Read and Nominal Defendant Empery Digital, Inc. WILL, Vice Chancellor  Advance notice bylaws are commonplace and vital tools for Delaware corporations. They promote orderly meetings and election contests, giving boards time to evaluate candidates and information to make recommendations to stockholders. Given the important corporate purposes such bylaws serve, this court routinely enforces unambiguous provisions. The court cannot, however, enforce a requirement that a bylaw does not contain. In this case, an activist investor sought to nominate a full slate of director candidates to the board of Empery Digital, Inc.—a digital asset treasury company. The board rejected the nomination, citing suspicions that the investor was coordinating with another stockholder who had plans to take control of Empery and liquidate its Bitcoin assets. The board also noted that the investor failed to disclose a massive short position in Bitcoin exchange-traded funds, which the board felt misaligned the investor with other Empery stockholders. During the ensuing expedited trial, evidence came to light that lends credence to the board’s beliefs. Yet the board’s rejection suffers from a fatal flaw: Empery had no advance notice bylaw provision requiring disclosure of the information the board identified as missing. The board instead invokes general bylaw provisions incorporating federal proxy rules—some of which were not raised until trial, and others that do not call for the information the board demands. 1  Advance notice bylaws do not authorize incumbent boards to exclude director candidates based on the incumbents’ views of their unsuitability for office. It is the fundamental right of the stockholders—not the directors—to select the individuals who will determine the strategic direction of the company. Empery’s board is free to raise its views during the proxy contest. But, given the lack of relevant bylaws, it was both contractually improper and inequitable to reject the nomination notice entirely. Separately, the investor seeks a reopening of the nomination window following Empery’s post-deadline announcement of an AI data-center transaction. Because the nomination notice is valid and the investor’s slate will stand for election, no further equitable intervention is required. This decision leaves the choice with Empery’s stockholders. I. FACTUAL BACKGROUND The following were stipulated to by the parties or proven by a preponderance of the evidence after trial.1 1 See Joint Pre-trial Stipulation and Order (Dkt. 248) (“PTO”). Trial occurred over three days, during which five fact witnesses and five expert witnesses testified live. Testimony of five fact witnesses was presented by deposition. See Trial Tr. Vols. I-III (Dkts. 265-67). Trial testimony is cited as “[Name] Tr. __.” The trial record contains 895 joint exhibits and 28 deposition transcripts. Exhibits are cited by the numbers provided on the parties’ joint exhibit list as “JX __,” unless otherwise defined. Pincites are to pagination on joint exhibits where available, and to the last four digits of Bates stamps where unavailable. See Final Joint Ex. List (Dkt. 220); Deposition transcripts are cited as “[Name] Dep. __.” See Am. Notice of Lodging of Dep. Trs. (Dkt. 237). 2  A. Empery and its Bitcoin DAT Empery Digital, Inc. (“Empery” or the “Company”) is a Delaware corporation headquartered in Texas.2 Its stock is traded on the Nasdaq Global Select Market.3 In July 2025, Empery’s predecessor adopted a digital asset treasury (“DAT”) strategy to acquire and hold Bitcoin.4 A DAT is a publicly traded company that holds cryptocurrency as a primary asset.5 At the time, DAT share prices were generally trading at a premium to the net asset value (“NAV”) of their underlying cryptocurrency.6 Also in July 2025, Empery announced the closing of a $500 million private investment in public equity (PIPE), led by defendant Ryan Lane and his hedge fund, Empery Asset Management.7 The PIPE closed at $10 per share.8 Afterward, Lane was appointed Co-Chief Executive Officer alongside legacy CEO, defendant John Kim.9 Empery’s reconstituted Board of Directors (the “Board”) included Chairman 2 PTO ¶ 13. 3 Id. ¶ 14. 4 Id. ¶¶ 16, 25. 5 JX 677 (Expert Report of Angelo Chan (“Chan Report”)) ¶¶ 24-25. 6 Id. ¶ 24 n.7; id. ¶ 25. 7 PTO ¶ 17; Lane Tr. 272-74, 298. 8 PTO ¶ 17. 9 Id. ¶ 18. 3 Lane, Kim, and Jonathan Foster, Adrian Solgaard, Örn Ólason, Ian Read, Rohan Chauhan, and Matthew Homer.10 B. Empery’s NAV Gap Empery soon struggled. By the end of 2025, its stock price had fallen to $4.57.11 Stockholders who held shares since the PIPE “lost a lot of money.”12 Empery’s Chief Operating Officer Tim Silver, who had joined the Company from EAM, anticipated activist pressure.13 Cryptocurrency prices began to sharply decline in the fall of 2025.14 The premiums that had incentivized stockholders to invest in DATs began to flip. Rather than trading at a premium, many DATs began trading at a discount to their underlying assets.15 Empery was no exception. By January 8, 2026, it was trading at a market-to- net-asset value of 0.73, meaning the market valued the Company at just 73% of the value of its Bitcoin.16 Thus, to the extent a stockholder could acquire control of 10 Id. ¶¶ 16, 18. 11 Lane Tr. 306; JX 437, “Daily Summary.” 12 Lane Tr. 307. 13 Silver Tr. 550. 14 JX 707 (Rebuttal Expert Report of Angelo Chan) ¶ 31. 15 JX 217. 16 Chan Report ¶ 41. 4 Empery for 73% of the value of its Bitcoin and force a sale of that Bitcoin at market price, the stockholder could capture the spread.17 C. Brown’s and Gliksberg’s Investments Tice Brown—a self-described “fundamental value investor”—was one of Empery’s PIPE investors.18 Brown had invested $2 million alongside his friend Jacob Ma-Weaver.19 In September 2025, Brown began contacting Lane and Silver about Empery’s poor performance and advocated for share repurchases.20 To capitalize on the growing NAV gap, Brown bought more Empery stock throughout the fall of 2025.21 Brown began to consider whether he could take Empery “private at 100% nav.”22 Gabi Gliksberg—an activist investor—had also noticed Empery’s “very significant discount” to NAV.23 Gliksberg had recently launched plaintiff ATG 17 Id. ¶¶ 12, 80. 18 Brown Tr. 160, 171. 19 Id. 160, 194. 20 E.g., JX 225 at 41, 66, 72-79; Brown Tr. 162-63; Lane Tr. 311. 21 See DDX2; Brown Tr. 160-61, 251-52. 22 JX 82; see JX 83; see also JX 81; JX 86; JX 89. 23 Gliksberg Tr. 11; see also id. at 12, 20-22. 5 Capital Opportunities Fund LP.24 His marketing materials touted ATG’s willingness to use litigation and pursue “liquidations” to force value realization.25 Gliksberg set out to purchase “as much Empery stock as possible.” 26 On the morning of January 15, ATG placed nineteen limit orders for approximately 1.36 million shares of Empery common stock.27 Later that day, Gliksberg called Ma-Weaver, with whom he had previously invested, to investigate why Empery was trading at such a “steep discount.”28 Brown had also called Ma-Weaver on January 15 to discuss Empery. Two days earlier, Brown had texted Ma-Weaver to “come do empd,” to which Ma- Weaver—who had previously faced group allegations alongside Gliksberg— replied: “Not a group!”29 Ma-Weaver had no interest in taking an activist position and did not “want to inadvertently trigger a 13D.”30 He put Brown and Gliksberg in touch by email, writing: “You both called me on the same topic today, and you should get to know one another regardless.”31 24 Id. at 5-6. 25 JX 117 at 8-10; Gliksberg Tr. 101-03. 26 Gliksberg Tr. 90-91, 117-18. 27 JX 825 at ‘0554. 28 Gliksberg Tr. 26-27; see Brown Tr. 171. 29 JX 109; see Brown Tr. 211-12. 30 JX 940; see JX 58; JX 59. 31 JX 169; see PTO ¶ 28. 6  D. Brown and Gliksberg Meet Within minutes of Ma-Weaver’s introduction, Brown called Gliksberg—the first of several phone calls that afternoon that totaled over an hour.32 Brown and Gliksberg testified that they spoke about everything from religion, to their children, to Brown’s fine art trading, and current events.33 They also spoke about Empery.34 Brown and Gliksberg testified that their discussion of Empery was minimal and did not include their respective investment theses, positions, or hedges.35 The weight of the evidence suggests otherwise. Less than an hour after Gliksberg’s first call with Brown, ATG submitted multiple orders for Empery stock, bringing ATG’s total January 15 purchases to 1,686,245 shares.36 In between his calls with Brown on January 15, Gliksberg called his longtime counsel on activism-related matters and investments—Aaron Morris— whom ATG later named as a candidate for nomination to Empery’s Board.37 Gliksberg also instructed his broker to move 1,000 Empery shares into record 32 JX 169 (Ma-Weaver’s introductory email at 1:36 p.m. on January 15); JX 108 (call log showing the first call between Gliksberg and Brown at 1:39 p.m.); see Brown Tr. 164-66. 33 Gliksberg Tr. 28-30, 31-32, 79; Brown Tr. 170-72, 180-81. 34 Gliksberg Tr. 28; Brown Tr. 171. 35 Gliksberg Tr. 29; Brown Tr. 172. 36 JX 868; Gliksberg Tr. 87-88, 123; JX 825 at ‘0554. 37 JX 111. 7 name.38 Shortly afterward, Brown consulted with his analyst to see if he had the funds to “buy up to 9.9%” of Empery.39 Brown and Gliksberg’s calls resumed the next morning, on January 16.40 Just before that call, Gliksberg texted Ronald Davies—one of ATG’s Board nominees— to tell him that he “might have a proxy fight coming up” and would “need to nominate directors.”41 Brown and Gliksberg spoke over the phone twice more that afternoon.42 During the day, Brown requested the transfer of 1,000 Empery shares to record name.43 Brown also pressed his broker and analyst on freeing up cash to make a large purchase of Empery shares.44 E. Schedule 13 Filings Gliksberg and Brown continued to speak over the ensuing days, while Gliksberg planned for a proxy contest. 38 JX 961; Gliksberg Tr. 76, 82-83. 39 JX 114; Boshans Tr. 260. 40 JX 108. 41 JX 118. 42 JX 108. 43 JX 960. 44 See JX 120; JX 121. 8  On January 18, Gliksberg asked ChatGPT for a “full timeline on all the important tasks” to “do a shareholder activist campaign against Empery Digital.”45 He then spoke to two other future nominees: James Elbaor and Christopher Novak.46 On January 19, Gliksberg and Brown spoke on the phone twice.47 One of their calls lasted 34 minutes.48 By January 20, Brown wired $2 million to his broker to purchase Empery shares.49 One hour after Brown’s first purchase of the day, Gliksberg attempted to call him, but the call did not go through.50 Brown purchased a total of 813,779 shares of Empery stock that day.51 Gliksberg’s attempted call to Brown on January 20 is the last in the record. From then on, Gliksberg and Brown communicated solely by Signal.52 Both testified that they did so due to poor cellular reception.53 Brown was at his home in Manhattan; Gliksberg was at his home in Miami.54 The auto-delete feature was 45 JX 124 at ‘1246. 46 JX 123; JX 125. 47 JX 108. 48 Id. 49 JX 120 at ‘3194; JX 133 at ‘3218. 50 JX 108. 51 JX 821. 52 Gliksberg Tr. 31; Brown Tr. 166-67. 53 Gliksberg Tr. 31; Brown Tr. 166-67. 54 Brown Tr. 185. 9 enabled on both of their Signal accounts, ensuring that their subsequent communications were destroyed.55 On January 23, Brown filed a Schedule 13G disclosing his 9.7% ownership of Empery.56 Later that evening, Brown requested an in-person meeting with Lane and Silver, which was set for January 28 at Empery’s offices.57 ATG also continued to purchase Empery shares, amassing another 934,822 shares by January 26.58 On January 26, ATG filed a Schedule 13D disclosing a 5.6% ownership stake in Empery.59 Its Form 13D stated that ATG “may in the future” engage “in short selling” or “hedging[.]”60 At the time of the filing, however, ATG had already hedged over 80% of its Empery position by shorting Bitcoin exchange- traded funds (ETFs).61 F. Brown’s Meeting and Bloomberg Story On January 28, Brown and his analyst met with Lane and Silver at Empery’s offices.62 The meeting quickly grew contentious. Brown demanded that Empery 55 Gliksberg Tr. 31; Brown Tr. 167-69. 56 JX 151. 57 JX 162; JX 164. 58 JX 825 at ‘0554. 59 JX 158 at 2. 60 Id. at 7. 61 See Grundfest Tr. 606-08; see also Chan Report ¶ 45. 62 See Silver Tr. 551. 10 immediately liquidate its Bitcoin to maximize returns.63 During the meeting, Brown claimed that other stockholders shared his views and maintained similar hedges. The only stockholder Brown named was ATG, referring to Gliksberg informally as “Gabi.”64 Unprompted, Brown volunteered: “I am not working with ATG.”65 To Lane and Silver, this unsolicited denial—coupled with Brown’s shifting stories about how he met Gliksberg—suggested the opposite.66 After Brown refused to leave, Lane called security to escort him out.67 On February 3, Brown sent a letter to the Board demanding Lane’s resignation, the replacement of the entire Board, and the “immediate sale of all Bitcoin” with the proceeds returned to stockholders.68 Brown attached this letter to a Schedule 13D filed the same day, which disclosed a roughly 9% stake in the Company.69 That evening, Brown emailed Bloomberg columnist Matt Levine, writing: “I’d like to liquidate a bitcoin treasury company. I’d like to speak publicly about 63 Id. at 551-52; Lane Tr. 284. 64 Silver Tr. 554-55. 65 Id. at 555; Lane Tr. 285. 66 Lane Tr. 285; Silver Tr. 555. 67 Silver Tr. 553; Boshans Tr. 266. 68 JX 215. 69 JX 211; see PTO ¶ 35. 11 it[.]”70 The next day, Levine published an article titled “Cracking Open the DATs,” which named both Brown and ATG.71 It described an arbitrage and liquidation strategy whereby an investor buys a stake in a DAT company that is trading at a discount to its NAV, and agitates for the company to liquidate its cryptocurrency to return the money to its stockholders.72 Shortly after publication, Gliksberg texted a link to the article to one of his Board nominees, instructing him: “Read it now! And then don’t text me about it.”73 G. The Rights Plan and the Competing Nominations On January 28, ATG filed an amended Schedule 13D, disclosing that it had nearly doubled its ownership from 5.6% to 10.4%.74 In response, on February 2, the Board adopted a limited duration stockholder rights plan (the “Rights Plan”) that would be triggered if a stockholder acquired 12.5% or more of the Company’s stock.75 The official minutes reflect the Board’s conclusion that the Rights Plan would protect stockholders while the Company “continu[ed] to execute on its plan to close 70 JX 234. 71 JX 217. 72 Id. 73 JX 219; see Gliksberg Tr. 139-40. 74 JX 177. 75 JX 202; JX 210. 12 the NAV gap.”76 AI-generated transcripts of the meeting show Lane told the Board that capping ATG’s ownership at 12.5% would limit its financial upside, making it “not worth it to put up [a] slate to go through the proxy solicitation process.” 77 He further advised that the Rights Plan was “necessary in order for the board to remain in its position.”78 The Board terminated the Rights Plan in July 2026.79 Meanwhile, Gliksberg solidified his slate of directors. The candidates he selected lacked cryptocurrency experience.80 Gliksberg enabled auto-deleting message settings when discussing the proxy contest with several of his nominees.81 In mid-February, he introduced his prospective slate to his counsel at Olshan Frome Wolosky LLP.82 On February 26—just days before the nomination window closed—ATG nominated Gliksberg, Arati Batta, Aaron Morris, Christopher Novak, Evan Ratner, Heather Powers, James Elbaor, Meredith Kirshenbaum, and Ron Davies for election to the Board (the “Nomination Notice”).83 The exact same day, after having 76 JX 202 at ‘0425-28. 77 JX 203 at ‘0373; see Lane Tr. 330-31. 78 JX 203 at ‘0371; see Lane Tr. 327-28. 79 PTO ¶ 68(h). 80 See Gliksberg Tr. 52-53; JX 263. 81 Id. at 42-43, 50-51. 82 JX 285; JX 287; JX 292; JX 294; JX 296; JX 298; JX 299; JX 300. 83 JX 359. 13 requested the nomination materials just two days prior, Brown submitted his own— partially handwritten—notice nominating himself.84 H. The Board’s Rejection The Board met on March 16 to discuss the activist stockholders. During that meeting, the directors conferred about their “understanding that ATG had a short position on Bitcoin”—a fact that concerned them.85 The Board members were “very suspicious” that Gliksberg and Brown were “acting together” and attempting “to hide it.”86 On March 25, Empery’s Chief Financial Officer circulated counsel’s draft deficiency letters.87 The Board and the Nominating and Corporate Governance Committee convened the next day, on March 26.88 At the meeting, they discussed their concerns with respect to Brown and ATG’s nominations. The directors focused on what they perceived as an undisclosed relationship between Brown and ATG, as well as ATG’s failure to disclose its Bitcoin short, which they felt was “important 84 JX 381; see Brown Tr. 249-50. 85 JX 417; see Read Dep. 147. 86 Lane Dep. 371; see also JX 416 at ‘1403 (AI-generated notes indicating Lane’s belief that “T[i]ce and ATG were acting together . . . as a group”). 87 JX 490. 88 JX 496. 14 for shareholders to know.”89 The directors also considered the “sheer volume of deficiencies” in the nominees’ questionnaires.90 The Nominating and Corporate Governance Committee recommended that the Board reject the nominations.91 The Board unanimously agreed.92 Empery, through counsel, subsequently issued substantially identical letters to ATG (the “Rejection Letter”) and Brown informing them that their nominations were deficient.93 The Rejection Letter cited three primary grounds for the Board’s decision, tied to provisions of Empery’s advance notice bylaws (the “Bylaws”).94 First, ATG did not disclose Brown as a “participant” in its solicitation, and omitted required participant disclosures about Brown—including his stock ownership and arrangements.95 Second, ATG did not disclose its short position in a Bitcoin ETF, which the Board contended misaligned ATG’s interests with other stockholders and was required to be disclosed under Schedule 14A.96 And third, ATG’s nominees’ 89 Homer Tr. 535-37; see also Solgaard Dep. 91-92. 90 JX 496; see JX 495 (AI-generated notes of the March 26 meeting). 91 JX 496. 92 Id. 93 JX 496; JX 497 (“Rejection Letter”); JX 494. 94 See JX 52 (“Bylaws”). 95 Rejection Letter 3-4, 8-10. 96 Id. at 5. 15 questionnaires contained biographical omissions and inaccuracies regarding their employment histories and outside directorships.97 I. The Litigation and the Strategic Pivot On April 2, ATG filed this suit against the Board to invalidate the rejection of its Nomination Notice and seat its nominees.98 While this litigation proceeded, Empery’s annual meeting was delayed. During that delay, on June 30, Empery announced a $65 million investment to acquire a 25% stake in an AI data center.99 Concurrently, the Company took its online treasury dashboard offline, declaring that reporting NAV based on Bitcoin holdings “no longer fully reflect[ed] the total NAV of the Company” and was no longer a useful tool for investors.100 In July, Empery sold approximately half of its remaining Bitcoin.101 On July 23, the Company announced an additional $20 million strategic investment in another data center affiliate.102 After Empery announced the AI data center investment, ATG supplemented its complaint to demand that the nomination window be reopened.103 97 Id. at 10-12. 98 See Verified Compl. (Dkt. 1). 99 JX 658; JX 856. 100 JX 856; JX 857. 101 See Lane Tr. 429, 436. 102 Id. at 429-30. 103 Verified Suppl. Compl. (Dkt. 207). 16  ATG advances a multitude of claims arising from this proxy contest. Beyond the core electoral dispute, ATG challenges a series of allegedly entrenching defensive measures. It asserts that the Board breached its fiduciary duties by adopting a direct offering transaction and a share repurchase program, and by issuing materially misleading disclosures.104 ATG also seeks a mootness fee for the Board’s post-filing termination of the Rights Plan.105 Given the impending annual meeting on October 14, the parties proceeded to an expedited trial to resolve the immediate threat to the stockholder franchise. This post-trial decision addresses only those expedited claims: whether the Board breached the Company’s bylaws or its fiduciary duties by rejecting ATG’s Nomination Notice, and whether the Company’s strategic pivot requires reopening the nomination window in equity. The plaintiff’s remaining claims were bifurcated to ensure the timely resolution of the electoral dispute. They will be addressed in a subsequent decision. II. ANALYSIS ATG contends the Board interfered with the stockholder franchise when it rejected its Nomination Notice and refused to extend the nomination deadline. It 104 See PTO ¶¶ 63(b)-(d), 68(b)-(c), 68(g). 105 Id. ¶ 68(h). 17 has the burden to prove its claims by a preponderance of the evidence. “Proof by a preponderance of the evidence means proof that something is more likely than not.” My analysis of these claims proceeds in two parts. First, I evaluate whether the Board’s rejection of ATG’s Nomination Notice was contractually and equitably permissible. Second, I address whether the Company’s post-deadline strategic pivot required the Board to reopen the nomination window. A. The Nomination Notice Rejection Under Delaware law, corporate actions touching upon the stockholder franchise are “twice-tested”—once by the law and again in equity.106 I begin with the legal question of whether ATG complied with the Bylaws, and whether the Board’s rejection breached the Bylaws.107 I then proceed to an equitable review of whether the Board inequitably impaired ATG’s nomination right.108 106 Strategic Inv. Opportunities LLC v. Lee Enters., Inc., 2022 WL 453607, at *14 (Del. Ch. Feb. 14, 2022) (“Put simply, directors’ inequitable acts towards stockholders do not become permissible because they are legally possible.” (citing Schnell v. Chris-Craft Indus., Inc., 285 A.2d 437, 439 (Del. 1971))). 107 See, e.g., id. at *9 (“Because bylaws are part of a flexible contract between corporations and stockholders, consideration of an advance notice bylaw’s application begins with a contractual analysis.” (citation omitted)); Jorgl v. AIM ImmunoTech Inc., 2022 WL 16543834, at *10 (Del. Ch. Oct. 28, 2022) (beginning the analysis of an advance notice bylaw by determining “whether the notice complied with the bylaws”). 108 See Kellner v. AIM ImmunoTech Inc., 320 A.3d 239, 259 (Del. 2024) (noting that advance notice bylaws “can be misused to thwart stockholder choice and entrench the existing board of directors,” requiring courts to “scrutinize closely corporate acts that affect stockholder voting”); see also Coster v. UIP Cos., Inc., 300 A.3d 656, 672-73 (Del. 2023) (outlining the equitable standard of review for board action that interferes with a corporate election or a stockholder’s voting rights). 18  1. The Contractual Review ATG seeks a declaration that the Board breached the Bylaws by rejecting its Nomination Notice. It claims that it timely submitted a compliant notice on February 26 to replace the full Board with nine qualified nominees, and that the Board’s stated grounds for rejecting the nomination were pretextual.109 The defendants respond that the Board properly rejected the Nomination Notice because it violated the Bylaws. The thirteen-page Rejection Letter detailed a litany of purported violations.110 At trial, the defendants winnowed their focus to two main justifications for the Board’s rejection: (1) that ATG failed to disclose Brown as a “participant” in its proxy solicitation; and (2) that ATG failed to disclose its short position in Bitcoin ETFs.111 As the party seeking to enforce its nomination, ATG bears the burden of demonstrating that its notice fulfilled the Bylaws’ requirements.112 “[A]dvance notice bylaw conditions act, in some respects, as conditions precedent to companies being contractually obligated to take certain actions.”113 Because corporate bylaws 109 See Pl.’s Post-trial Br. (Dkt. 260) 15, 52. 110 See generally Rejection Letter. 111 See Defs.’ Post-trial Br. (Dkt. 261) 6. 112 See Kellner v. AIM ImmunoTech Inc., 307 A.3d 998, 1037-38 (Del. Ch. 2023) (noting that the plaintiff “bears the burden of showing that his notice fulfills the bylaws’ requirements”), aff’d in part and rev’d in part, 320 A.3d 239 (Del. 2024). 113 Lee Enters., 2022 WL 453607, at *13 n.142. 19 constitute part of a broader binding contract among directors, officers, and stockholders, the court employs principles of contract interpretation when construing them. Clear and unambiguous terms are given their commonly accepted meaning, and any ambiguity in an advance notice bylaw is resolved in favor of the stockholder’s electoral rights.114 a. The Group Allegations The defendants’ overarching theory is that Gliksberg and ATG formed an undisclosed group with Brown.115 The Board was focused on this belief during the March 26 meeting where it voted to reject the Nomination Notice. According to the AI-generated transcript of that meeting, Lane told the Board that ATG and Brown “may still be acting[] as a group together”—though he did not “know it to be true”— and that highlighting this “narrative” was a “powerful part of th[e] rejection.”116 To be sure, the Board had reason to be suspicious. The Rejection Letter noted Brown’s strange preemptive statement during the January 28 meeting at Empery’s office that he was not working with Gliksberg—a statement that led the Board to suspect otherwise.117 At trial, the defendants elicited evidence supporting the 114 See Hill Int’l, Inc. v. Opportunity P’rs L.P., 119 A.3d 30, 38 (Del. 2015); Jorgl, 2022 WL 16543834, at *10. 115 Defs.’ Post-trial Br. 7-14. 116 JX 495. 117 See Rejection Letter 3 (“Based on statements made by Tice Brown (‘Mr. Brown’) to members of the Company’s management (including at the Company’s New York office on 20 Board’s suspicion that Brown and Gliksberg were coordinating regarding Empery securities—even without the evidence lost to Brown and Gliksberg’s use of Signal with auto-delete enabled.118 It is more likely than not that Brown and Gliksberg’s multiple communications in mid-January went beyond sharing pleasantries and focused on their plans for Empery. After Ma-Weaver declined to work with Brown on his plan to “crack open the DAT,” Brown and Gliksberg’s activity—phone calls, stock purchases, and outreach to prospective nominees by Gliksberg—rapidly intensified. The defendants analogize these facts to precedent where the court held that an undisclosed agreement, arrangement, or understanding (“AAU”) provided contractual or equitable grounds to reject a nomination.119 Yet there is a significant difference between the bylaws in those cases and the Bylaws at issue here. In prior January 28, 2026), the Company understands that Mr. Brown and ATG Capital have had specific discussions regarding the acquisition of the Company’s securities, as well as the timing of such acquisitions-actions that strongly indicate coordination between Mr. Brown and ATG Capital.”). 118 See supra Sections I.C-G. 119 See Defs.’ Post-trial Br. 9-10. The defendants’ pre-trial brief relied heavily on this precedent, arguing that “[t]his Court has already explained the applicability of the definition of ‘participant’ in the context of a stockholder nomination.” Defs.’ Pre-trial Br. (Dkt. 224) 43-44. None of the cited cases concern the disclosure of a “participant,” much less a participant as defined in Schedule 14A. 21 cases, the bylaws at issue explicitly required a nominating stockholder to disclose AAUs.120 Empery’s Bylaws do not. Section 2.5 of Empery’s Bylaws, which governs “Notice of Nominations for Election to the Board,” lacks any provision requiring a nominating stockholder to disclose an AAU concerning Empery or the nomination. This omission is striking because Section 2.4 of the Bylaws, which governs notices of business proposals to be brought before a meeting, requires the disclosure of all agreements, arrangements, and understandings in connection with the proposal.121 Nor does Empery have a bylaw requiring the disclosure of a Section 13(d) group.122 120 See Jorgl, 2022 WL 16543834, at *12 (“Article I, Section 1.4, subsection (i) . . . requires the disclosure of ‘a description of all arrangements or understandings’ between the nominating stockholder ‘and each proposed nominee and any other person or persons ... pursuant to which the nomination(s) are being made.’”); Kellner I, 307 A.3d at 1028 (interpreting the phrase “arrangements or understandings” in a bylaw). 121 See Bylaws § 2.4(c)(iii) (requiring the disclosure of “a reasonably detailed description of all agreements, arrangements and understandings (x) between or among any of the Proposing Persons or (y) between or among any Proposing Person and any other record or beneficial holder(s) or person(s) who have a right to acquire beneficial ownership at any time in the future of the shares of any class or series of the Corporation or any other person or entity (including their names) in connection with the proposal of such business by such stockholder”). Section 2.5 does not incorporate this provision. 122 Empery’s Bylaws mention Section 13(d) or its implementing regulations just twice. First, Section 2.4(c)(i) requires a proposing person or nominating stockholder to disclose shares that are “directly or indirectly, owned of record or beneficially owned (within the meaning of Rule 13d-3 under the Exchange Act).” Bylaws § 2.4(c)(i)(B). Second, Section 2.4(c)(ii)(A) mentions “Rule 13d” by referencing an inapplicable exception to the disclosure requirement for Schedule 13G filers. Id. § 2.4(c)(ii)(A). 22  The defendants point to two provisions in the Bylaws that they believe required ATG to disclose its relationship with Brown. They first cite a bylaw that requires a nominating stockholder to disclose any “participant” in a proxy solicitation (the “Participant Bylaw”).123 They also cite bylaws that require a nomination to include information required to be disclosed by Section 14(a) of the Securities Exchange Act of 1934 (the “Section 14(a) Bylaws”).124 ATG has met its burden to demonstrate that the Nomination Notice complied with both provisions with respect to the deficiencies the Board invoked in the Rejection Letter. i. The Participant Bylaw Empery’s Rejection Letter stated that the Nomination Notice was deficient because it failed to identify Brown as a “participant” in ATG’s proxy solicitation.125 Section 2.5 of the Bylaws defines “Nominating Person” to include “the stockholder providing the notice . . . and any other participant in such solicitation.”126 If Brown 123 Defs.’ Post-trial Br. 13 (“[B]rown was a ‘participant in such solicitation’ as the term is used in Section 2.5.”). 124 Id. at 8 (“The disclosure of Gliksberg and Brown’s arrangement was easily required under the Section 14(a) Bylaws.”). 125 Rejection Letter ¶ 4. 126 Bylaws § 2.5(c) (emphasis added). 23 were a participant, the Bylaws would have required ATG to disclose details about Brown as a Nominating Person.127 Section 2.4(c) of the Bylaws defines “participant” by reference to “paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A.”128 Although Section 2.5(c) does not explicitly define participant,129 the parties agree that the Section 2.4(c) definition applies equally to Section 2.5.130 A Schedule 14A is a required disclosure form that must be filed with the Securities and Exchange Commission (SEC) in connection with certain proxy solicitations.131 Paragraph 3(a) of Instruction 3 to Item 4 of Schedule 14A delineates 127 See Rejection Letter 3-4. 128 Bylaws § 2.4(c) (“For purposes of this Section 2.4, the term ‘Proposing Person’ shall mean (i) the stockholder providing the notice of business proposed to be brought before an annual meeting, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the business proposed to be brought before the annual meeting is made, and (iii) any participant (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A) with such stockholder in such solicitation.” (emphasis added)). 129 Compare Bylaws § 2.5(c) (“For purposes of this Section 2.5, the term ‘Nominating Person’ shall mean (i) the stockholder providing the notice of the nomination proposed to be made at the meeting, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the nomination proposed to be made at the meeting is made, and (iii) any other participant in such solicitation.” (emphasis added)), with id. § 2.4(c); see supra note 128. 130 See Pl.’s Post-trial Br. 29-30; Defs.’ Post-trial Br. 43. This reading is reasonable, since Sections 2.4 and 2.5 provide parallel tracks for stockholder action at an annual meeting. It would be illogical for Empery to apply a regulation-based standard for “participants” backing a proposal (Section 2.4), but apply a vague standard for “participants” seeking to nominate director candidates (Section 2.5). 131 17 C.F.R. § 240.14a-101. 24 the persons deemed to be a “participant” or a “participant in a solicitation” in a proxy contest. The five subparagraphs that Empery’s Bylaws incorporate define “participant” as: (ii) In the case of a solicitation . . . each of the soliciting person’s nominees for election as a director; (iii) Any committee or group which solicits proxies, any member of such committee or group, and any person whether or not named as a member who, acting alone or with one or more other persons, directly or indirectly takes the initiative, or engages, in organizing, directing, or arranging for the financing of any such committee or group; (iv) Any person who finances or joins with another to finance the solicitation of proxies . . . ; (v) Any person who lends money or furnishes credit or enters into any other arrangements, pursuant to any contract or understanding with a participant, for the purpose of financing or otherwise inducing the purchase, sale, holding or voting of securities of the registrant by any participant or other persons, in support of or in opposition to a participant; except that such terms do not include a bank, broker or dealer who, in the ordinary course of business, lends money or executes orders for the purchase or sale of securities and who is not otherwise a participant; and (vi) Any person who solicits proxies.132 The defendants focus on subparagraph (v). They argue that this subparagraph broadly captures anyone who “‘enters into any . . . understanding with a participant, for the purpose of . . . purchas[ing] . . . or voting’ securities ‘in support of’ a 132 Id. at Item 4, Instruction 3(a)(ii)-(vi) (2025). 25 participant.”133 This