EFiled: Jun 30 2021 04:14PM EDT Transaction ID 66729836 Case No. 2019-0303-JRS IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

LINDA LAO, : : Plaintiff, : : v. : : DALIAN WANDA GROUP CO., LTD.; WANDA : AMERICA ENTERTAINMENT, INC.; WANDA : AMERICA INVESTMENT HOLDING CO. LTD.; : WANG JIANLIN; SILVER LAKE GROUP, L.L.C.; : C.A. No. 2019-0303-JRS SILVER LAKE ALPINE, L.P., ADAM ARON; : HOWARD W. KOCH, JR.; GARY LOCKE; and : ORIGINAL FILED: ANTHONY SAICH, : June 23, 2021 : Defendants, : PUBLIC VERSION : FILED: and : June 30, 2021 : AMC ENTERTAINMENT HOLDINGS, INC., : : Nominal Defendant. : :

PLAINTIFF’S MOTION TO COMPEL VERIFIED INTERROGATORY RESPONSES FROM DEFENDANT WANG JIANLIN

Pursuant to Court of Chancery Rules 33 and 37, Plaintiff Linda Lao moves for an order compelling Defendant Wang Jianlin to provide verified answers to

Plaintiff’s First Set of Interrogatories (“First Interrogatories”) and Plaintiff’s Second

Set of Interrogatories (“Second Interrogatories”).1 Plaintiff also asks that she be awarded her fees and expenses incurred in bringing this motion.

I. INTRODUCTION

1. This is a stockholder action in which Plaintiff asserts dual-natured entire-fairness claims that arise from a conflicted three-part transaction involving

Nominal Defendant AMC Entertainment Holdings, Inc. (“AMC”), the Company’s then-majority stockholder Dalian Wanda Group Co. Ltd. (“Dalian Wanda”), and affiliated entities,2 and certain Silver Lake entities.3 Plaintiff asserts breach of fiduciary duty claims against certain members of AMC’s Board, Wang (the controlling stockholder of Wanda and, thus, the ultimate controller of AMC), and the other Wanda Defendants. She also asserts aiding-and-abetting claims against

1 Plaintiff’s First Set of Interrogatories to the Wanda Defendants (defined herein) are attached as Exhibit A. The Wanda Defendants’ Responses and Objections to Plaintiff’s First Set of Interrogatories are attached as Exhibit B. Plaintiff’s Second Set of Interrogatories to Wang are attached as Exhibit C. Wang’s Objections to Plaintiff’s Second Set of Interrogatories are attached as Exhibit D. 2 Wanda America Entertainment, Inc. and Wanda America Investment Holding Co. Ltd. Collectively, Wang and the Wanda entities are the “Wanda Defendants.” 3 The “Silver Lake” entities are Silver Lake Group, L.L.C. and Silver Lake Alpine, L.P.

1 Silver Lake.

2. After Plaintiff filed her Complaint, Defendants caused AMC’s Board to create a two-person Special Litigation Committee consisting of Adam Sussman and Philip Lader. The SLC then conducted a lengthy investigation with which

Wanda and Wang failed to cooperate.4 The SLC then moved to dismiss Plaintiff’s entire-fairness claims in their entirety.

3. During the course of the SLC’s investigation, Sussman left his job as an executive at Nike, Inc. to accept a role as the President of Epic Games, Inc., a privately held software company.5 Epic has received substantial funding from

Tencent Holdings, a Chinese holding company that owns 39% of Epic’s fully diluted stock and has appointed two of its five directors.6 In turn, Tencent has a thick relationship with Wang and Wanda and has invested directly in and engaged in joint ventures with various Wanda affiliates.7 There may also be strong personal ties between Wang and Ma Huateng (“Pony Ma”), Tencent’s founder and Chairman.

Wang and Ma are two of the five wealthiest people in China and both men have deep ties to China’s Communist Party.8 It has also been reported that Wang’s son, Wang

4 SLC Report at 337-38, 340-42. 5 SLC Report at 25. 6 Ex. E at 31-32. 7 Ex. B at. 6-11. 8 Ex. F (Ma is a member of China’s parliament, the National People’s Congress,

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7. In this action, Wang and Dalian Wanda refused to accept service, forcing Plaintiff to seek (and obtain) Court approval of alternative service via their counsel.17 After Wang and Dalian Wanda were served, Plaintiff and the Wanda

Defendants negotiated a stipulation that would allow all of the Wanda Defendants to participate in Zapata discovery without waiving any defenses (including those related to personal jurisdiction or adequacy of service).18

8. In response to the First Interrogatories, Wang and the other Wanda

Defendants served responses and objections that included substantive responses on behalf of Wang and the other Wanda Defendants but did not include a verification.19

After multiple follow-ups from Plaintiff, Wang and the other Wanda Defendants belatedly served a single verification signed by someone named either “Liu” Wei or

“Lui” Wei,20 who purported to sign as an “authorized representative” on behalf of all of the Wanda Defendants, including Wang.21 When Plaintiff followed up, seeking a verification from Wang, personally, Wang’s counsel replied that Wang would not

16 Id. at 10. 17 Trans. ID 65997240 (order authorizing alternative service via counsel); Trans. ID 66020440 (declaration of alternative service via counsel). 18 Trans. ID 66401062. 19 Ex. B. 20 The verification uses two different spellings. 21 Ex. K.

5 provide his own verification because he did not have “unique or special knowledge” about the answers provided:22

Chairman Wang will not provide a supplemental verification. Chairman Wang does not have any unique or special knowledge about the transactions discussed in Wanda’s Responses and Objections to the First Set of Interrogatory Requests. Individuals within the Wanda entities have more knowledge about those transactions and those entities (through their representative) are the proper parties to provide the verification. Plaintiff has the verification from the Wanda entities, which is where the information that was used to respond and object came from, and that is the verification that is appropriate in this case.

9. For the Second Interrogatories (regarding the potential in-law or in- law-like relationship), Wang objected and refused to provide any response on the grounds that the information sought was irrelevant to the SLC’s independence.23

10. The parties have met and conferred regarding both sets of interrogatories and are at an impasse.24 Wang refuses to verify his responses to the

First Interrogatories and refuses to answer the Second Interrogatories.

III. ARGUMENT

A. Wang Must Verify And, If Applicable, Supplement His Answers To The First Interrogatories

11. “Failing to comply with [a verification] requirement is not some mere

22 Ex. L. 23 Ex. D. 24 Ex. L.

6 technicality; it undercuts the integrity of the judicial process.”25

“The verification requirement is designed to encourage truthfulness.”26 A statement in an interrogatory response … carries considerable dignity” and is meant to be

“something on which an opposing party and the court reasonably can rely.”27 For that reason, Rule 33(b)(2) is unambiguous: “answers [to interrogatories] are to be signed by the person making them[.]” Wang must verify his own answers; he cannot rely on an “authorized representative.”28

12. Here, Plaintiff’s First Interrogatories seek information concerning, among other things, any business, personal, financial, or professional relationships between Wang himself and Tencent.29 The other Wanda Defendants—which are some, but not all of the corporate entities that Wang controls—may have some knowledge relevant to this issue but only Wang has knowledge of all of his own ties to Tencent.

25 Bessenyei v. Vermillion, Inc., 2012 WL 5830214, at *8 (Del. Ch.). 26 OptimisCorp v. Waite, 2015 WL 5147038, at *7 (Del. Ch.), aff'd, 137 A.3d 970 (Del. 2016). 27 A Itron, Inc. v. Consert Inc., 109 A.3d 583, 590–91 (Del. Ch. 2015). 28 Tuckman v. Aerosonic Corp., 1977 WL 5973, at *4 (Del. Ch.) (“the Rule seems by implication to require that the Answers themselves ordinarily be signed by a party and not by his attorney. There might be special circumstances (i.e. absence, illness, etc.) which might mitigate this Rule but no special circumstances have been shown here. The Answers to the Interrogatories should be signed by the Plaintiff.”). 29 E.g., Ex. A, Interrogatories 1, 2, and 3.

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Defendant Adam Aron, as set out in detail in the SLC’s Report.33 Worse still, Zhang destroyed evidence by getting rid of the device on which those communications were stored.34 (The SLC ultimately obtained these communications only because Aron produced them).35

16. This further underscores why a verification is needed here. Counsel’s carefully worded response suggests that Wang may not even have been asked to provide information responsive to these interrogatories from his own personal knowledge.36 Given Wang and Wanda’s refusal to cooperate with—and outright misstatements to—the SLC, one might conclude that Wang’s subordinates were afraid to bother him with “trifles” like complying with his obligations to an

33 SLC Report (filed Jan. 8, 2021) at 10 (“Aron’s WeChat communications with Zhang gives the impression that he was improperly currying favor with Wanda.”); id. at 201-03 (Aron boasting to Zhang, by WeChat. that he had “negotiated on [Wanda’s] behalf” to obtain even more favorable terms from the SLC than Zhang had authorized); id. at 207 (Aron told Zhang, by WeChat, he was “doing his duty” to Wanda); id. at 219 (Aron to Zhang, by WeChat: “Special Committee has been trying to squeeze Wanda for 1.1 million shares without getting you any extra money. I did not even bother to tell you or ask you, I just said NO NO NO. And again NO NO NO. Loud voices, much tension. But I am your advocate. I have a strong backbone. I am very loyal to Wanda, to Chairman, and to you Lincoln my friend. I am NOT going to let these Directors squeeze you”); id. at 92, 95, 173, 174, 178-79, 184-85, 187, 191, 212-13, 308 (discussing other electronic communications between Zhang and Aron) 34 Id. at 338 n.747. 35 Id. 36 Ex. L (“the Wanda entities … [are] where the information that was used to respond and object came from.”).

9 American court sitting in a small state called Delaware.37

17. To ensure the integrity of these proceedings, Wang must verify the answers given or, if they are incomplete, provide supplemental information from his own personal knowledge and verify the supplemental response.

B. Wang Must Answer (And Verify His Answer To) The Second Interrogatories

18. Wang must also answer the Second Interrogatories (complete with a signed verification). He objects to doing so on the grounds that the interrogatory— asking about about his son’s relationship with Ma’s daughter—“seeks evidence outside of the narrow issue of the independence and good faith of the SLC” and

“[n]one of the information sought has any relation to (i) AMC’s Board of Directors,

(ii) members of the SLC, or (iii) individuals who were interviewed or otherwise involved in the SLC’s investigation, the SLC’s Report, or the SLC’s Motion to

Dismiss.”38

19. But whether an SLC member is independent “is a fact-specific

37 Compare with KFC National Council and Advertising Cooperative, Inc. v. KFC Corp., C.A. No. 5191-VCS (Del. Ch. May 11, 2010) (Transcript) (Ex. N) at 100-101 (“I had a very big computer case where … the CEO of a very big computer company – didn’t have any e-mails. Ha, ha. Right? He doesn’t have any e-mails. He only runs one of the world’s five biggest corporations dealing with computer information. Why? Because his general counsel staff were … scared to ask him.”). 38 Ex. D at 6.

10 determination[.]”39 “At bottom, the question of independence turns on whether a director is, for any substantial reason, incapable of making a decision with only the best interests of the corporation in mind.”40 “Independence can be impaired by lesser affiliations, so long as those affiliations are substantial enough to present a material question of fact as to whether the SLC member can make a totally unbiased decision.”41

20. For example, in Oracle, then-Vice Chancellor Strine looked to various ties that the defendants had with Stanford University to determine that there was “a reasonable doubt about the impartiality of the SLC” because it was composed of two tenured Stanford professors.42 And in London v. Tyrrell, the court denied an SLC’s motion to dismiss because a defendant was a cousin of an SLC member’s spouse, and the SLC member and defendant “[saw] each other regularly, albeit infrequently,

39 Beam v. Stewart, 845 A.2d 1040, 1050 (Del. 2004). 40 In re Oracle Corp. Derivative Litig., 824 A.2d 917, 938 (Del. Ch. 2003) (citing Parfi Holding AB v. Mirror Image Internet, Inc., 794 A.2d 1211, 1232 (Del. Ch. 2001) (footnotes omitted) (emphasis in original), rev’d in part on other grounds, 817 A.2d 149 (Del. 2002), cert. denied, 538 U.S. 1032 (2003)). 41 Oracle, 824 A.2d at 939 n.52 (Del. Ch. 2003). 42 Id. at 921, 929-935 (finding that, because one director was also a professor at Stanford who had taught one of the committee members, another was a Stanford alumnus who had donated millions of dollars to Stanford, and the CEO also donated millions of dollars to Stanford, “[t]aken together, these and other facts cause . . . a reasonable doubt about the impartiality of the SLC.”).

11 at family functions[,]”43 thus giving rise to a “material question of fact as to how much [the SLC member’s] family association with [the defendant] may have influenced his objectivity.”44

21. As in Oracle and Tyrell, Plaintiff is entitled to investigate whether the key defendant—Wang—might be able to exert potential influence on a member of the SLC through similar ties. Sussman reports to Epic’s board of directors, forty percent of whom report to Tencent and ultimately Pony Ma.45 We already know that

Ma/Tencent and Wang/Wanda have a thick business relationship. Plaintiff is entitled to discovery to determine whether that relationship has also blossomed into a quasi- familial one.

C. The Court Should Award Fees

22. When a motion to compel is successful, Rule 37(a)(4) requires that fees be shifted in favor of the prevailing party, unless the opposition was substantially justified or other circumstances would make a fee-shift unjust. Simply put, Rule 37

43 London, 2010 WL 877528, at *14. 44 Id. 45 Id. at 31-32. Compare with Sciabacucchi v. Liberty Broadband Corp., 2018 WL 3599997, at *13 (Del. Ch.) (“Malone serves on the Charter board, and three other directors [out of a total of ten] are designated by Liberty Broadband. … Given that Rutledge [Charter’s CEO] presumably receives his primary income from his employment at Charter, it is doubtful that [he] can consider the demand on its merits without also pondering whether an affirmative vote would endanger [his] continued employment.”) (cleaned up).

12 exists “so that there’s a consequence” for forcing unnecessary motion practice.46

Here, Wang’s position is unjustified and the Court should, thus, shift fees.47

IV. CONCLUSION

23. The Court should compel Wang to provide a verification to (and, if necessary, supplement) his answers to Plaintiff’s First Interrogatories and respond to Plaintiff’s Second Interrogatories. The Court should also award Plaintiff the fees and expenses incurred in bringing this motion.

46 Virtus Capital L.P. v. Eastman Chemical Company, No. 9808-VCL (Del. Ch. Dec. 2, 2015) (Transcript) (Ex. O) at 45. 47 Cumming v. Eden, No. 13007-VCS (Del. Ch. July 12, 2018) (Transcript) (Ex. P) at 56 (“I’ll award reasonable fees for the filing of the motion. I think that’s the presumption in our Rule 37.”).

13 Dated: June 23, 2021 Respectfully submitted,

OF COUNSEL: BLOCK & LEVITON LLP /s/ Nathan A. Cook BLOCK & LEVITON LLP Nathan A. Cook (#4841) Jason M. Leviton 8 W. Mozart Dr. Joel A. Fleming Wilmington, DE 19807 Amanda R. Crawford (302) 499-3600 260 Franklin St., Suite 1860 Boston, Massachusetts 02110 Counsel for Plaintiff Linda Lao (617) 398-5600

HEYMAN ENERIO GATTUSO & HIRZEL LLP

/s/ Kurt M. Heyman Kurt M. Heyman (# 3054) Aaron M. Nelson (#5941) 300 Delaware Ave., Suite 200 Wilmington, DE 19801 (302) 472-7300

Counsel for Plaintiff Linda Lao

Words: 2,996

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