SiriusXM Holdings, Inc.

 

KTMC brought claims by former minority stockholders of Sirius XM Holdings Inc. (“Sirius XM”) to challenge Sirius XM’s transaction with its controlling stockholder, Liberty Media Corporation (“Liberty Media”). In this transaction, Liberty Media effectuated a transaction to combine Liberty SiriusXM Group, comprising Liberty Media’s ownership of Sirius XM, with certain Liberty Media liabilities into a new company, which then merged with Sirius XM to form “New Sirius” (the “Transaction”). Plaintiffs allege that the Transaction was unfair to Sirius XM’s minority stockholders for a variety of reasons, including that: (i) it permits Liberty Media to offload potentially massive, unrelated tax liabilities onto New Sirius, and (ii) causes New Sirius to assume almost two billion dollars of Liberty SiriusXM Group debt. Moreover, the apparent purpose of the Transaction was to close the value gap between the trading price of Liberty SiriusXM Group’s tracking stock and Sirius XM’s net asset value, which provided no benefit to former Sirius XM stockholders, but created massive potential value for Liberty SiriusXM Group stockholders.

Plaintiffs filed their complaint on October 15, 2024. On December 19, 2024, seven members of Sirius XM’s board of directors—Defendants James Meyer, Jonelle Procope, Michael Rapino, Kristina Salen, Carl Vogel, Jennifer Witz, and David Zaslav (the “Sirius XM Director Defendants”)—filed a motion to dismiss Plaintiffs’ claims against them (the “Director MTD”). The Director MTD largely argued that the Sirius XM Director Defendants neither harbored any self-interest adverse to Sirius XM stockholders’ interests nor acted to advance Liberty Media’s interests. Also on December 19, 2024, Defendants Liberty Media, John C. Malone, Gregory B. Maffei, David A. Blau, Robin P. Hickenlooper, and Evan D. Malone (the “Liberty Defendants”) answered Plaintiffs’ complaint instead of filing motions to dismiss. The Liberty Defendants only filed a partial joinder to a section of the Director MTD which argued that Plaintiffs asserted a barred derivative claim by challenging the fairness of the above-described debt-shifting provisions.

Plaintiffs vigorously opposed the Director MTD in briefing and oral argument. On April 13, 2026, Chancellor McCormick issued a memorandum opinion and order rejecting the Director MTD. In so doing, the Chancellor held that: (i) Plaintiffs have standing to challenge the entire fairness of the Transaction, including its debt-shifting provisions, and (ii) it is reasonably conceivable that the Sirius XM Director Defendants advanced Liberty Media’s interests by voting to approve the Transaction. In response to the Chancellor’s ruling, the Sirius XM Director Defendants pursued an interlocutory appeal which Plaintiffs again successfully opposed. On July 1, 2026, a three-justice panel of the Delaware Supreme Court affirmed the Chancellor’s ruling denying the Director MTD.

Plaintiffs are currently pursuing discovery from Defendants and related third parties. Trial in this action is scheduled for October 2027.

KTMC’s case team includes: Lee Rudy, Dan Albert, Matthew Benedict, and Lauren Lummus.