Oca Memorandum Boston Technologies

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SUPREME COURT OF THE STATE OF NEW YORKCOUNTY OF NEW YORK: COMMERCIAL DIVISION------------------------------------------------------------------------------ X

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AMENDED MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFF'S

APPLICATION FOR A PRELIMINARY INJUNCTION AND A TEMPORARY

RESTRAINING ORDER

Vivian R. DrohanDrohan Lee LLP489 Fifth Avenue New York, New York 10017Tel.: (212) 710-0004Fax: (212) 710-0003Counsel for Plaintiffs

KEVIN MILLIEN, individually and in his capacity asshareholder of BOSTON TECHNOLOGIES, INC., aDelaware corporation,

Plaintiff ,

-against-

GEORGE POPESCU, individually and in his capacity asdirector of BOSTON TECHNOLOGIES, INC., CURRENCYMOUNTAIN HOLDINGS, LLC, a Delaware limited liabilitycompany, FOREXWARE, LLC, a Delaware limited liabilitycompany, and EMIL ASSENTATO, individually and in his

capacity as controlling shareholder of CURRENCYMOUNTAIN HOLDINGS, LLC,

Defendants ,

-and-

BOSTON TECHNOLOGIES, INC., a Delaware corporation,

Nominal Defendant.

ILED: NEW YORK COUNTY CLERK 11/13/2014 09:46 PM INDEX NO. 653207/

YSCEF DOC. NO. 39 RECEIVED NYSCEF: 11/13/





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Table of Contents

PRELIMINARY STATEMENT ................................................................................................... 1

STATEMENT OF FACTS ............................................................................................................. 1

ARGUMENT ................................................................................................................................... 1

I. TEMPORARY RESTRAINING ORDER IS NECESSARY TO PROTECTPLAINTIFF’S AND OTHER MINORITY SHAREHOLDER’S INTERESTS PRIOR TO APRELIMINARY JUNCTION HEARING .................................................................................... 1

II. PRELIMINARY INJUNCTION IS NECESSARY TO PREVENT FURTHER INJURYOR HARM TO PLAINTIFF’S AND OTHER MINORITY SHAREHOLDER’S INTERESTSPENDING FURTHER PROCEEDINGS ON PLAINTIFF’S CLAIMS ...................................... 3

a. Plaintiff is Likely to Succeed on the Merits ....................................................................... 4

1. Popescu Breached his Fiduciary Duties ............................................................................................................... 4

2. Popescu Committed Misrepresentation and Fraud ......................................................................................13

3. Popescu is Liable for Wasteful and Unlawful Conveyance ........................................................................ 16

4. Popescu Committed Conversion ...........................................................................................................................17

5. Popescu was Unjustly Enriched ............................................................................................................................18

6. Currency Mountain, Forexware, and Assentato Aided and Abetted Popescu’s Breach of

Fiduciary Duty.................................................................................................................................. ............................................... 19

7. Currency Mountain, Forexware, and Assentato Aided and Abetted Popescu’s

Misrepresentation and Fraud ..................................................................................................................................................21

8.

Currency Mountain, Forexware, and Assentato Aided and Abetted Popescu’s Conversion ......23

9. Currency Mountain, Forexware, and Assentato Committed Tortious Interference with

Business Relations against the Plaintiff ...............................................................................................................................24

10. Individual Defendant Assentato is Personally Liable for Currency Mountain’s and Forexware’s

Torts 25

11. Plaintiff is Entitled to Declaratory Judgment ................................................................................................... 26

b. Plaintiff and Other Minority Shareholders will Suffer Irreparable Injury Absent anInjunction ................................................................................................................................ 27

c. Balance of Equities Favors Plaintiff and other Minority Shareholders in Preventing the

Loss and Harm that will Result to Minority Shareholders without Preliminary InjunctiveRelief ....................................................................................................................................... 27

CONCLUSION ............................................................................................................................. 29



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Table of Authorities

Cases

Amaranth LLC v. J.P. Morgan Chase & Co., 71 A.D.3d 40, 888 N.Y.S.2d 489 (App. Div. 2009)..................................................................................................................................................... 24

Arcamone–Makinano v. Britton Prop., Inc., 83 A.D.3d 623, 920 N.Y.S.2d 362 (App. Div. 2011) 4 Arnold v. Soc’y for Sav. Bancorp, Inc., 650 A.2d 1270 (Del. 1994) .................................. 13, 14, 16 Birnbaum v. Birnbaum, 73 N.Y.2d 461, 541 N.Y.S.2d 746 (1989) ............................................... 15 Burmax Co. v. B & S Indus., Inc., 135 A.D.2d 599, 522 N.Y.S.2d 177 (App. Div. 1987)............. 28Carvel Corp. v. Noonan, 3 N.Y.3d 182, 818 N.E.2d 1100 (2004) ................................................. 24Cede & Co. v. Technicolor, Inc., 634 A.2d 345 (Del. 1993) ............................................................ 6Chanos v. MADAC , LLC, 74 A.D.3d 1007, 903 N.Y.S.2d 506 (App. Div. 2010) ......................... 26Colavito v. New York Organ Donor Network, Inc., 8 N.Y.3d 43, 860 N.E.2d 713 (2006) ............ 18Cromer Fin. Ltd. v. Berger, 137 F. Supp. 2d 452 (S.D.N.Y. 2001) ............................................... 22Culligan Soft Water Co. v. Clayton Dubilier & Rice LLC , 118 A.D.3d 422, 988 N.Y.S.2d 134

(App. Div. 2014) ..................................................................................................................... 5, 17

Datwani v. Datwani, 102 A.D.3d 616, 959 N.Y.S.2d 153 (App. Div. 2013) ............................... 2, 3 Diamond States Ins. Co. v. Worldwide Weather Trading LLC , No. 02 CIV 2900 LLM GWG,

2002 WL 31819217 (S.D.N.Y. Dec. 16, 2002) .......................................................................... 23 Dubai Islamic Bank v. Citibank, N.A., 126 F. Supp. 2d 659 (S.D.N.Y.2000) ................................ 19 Dupigny v. St. Louis, 115 A.D.3d 638, 981 N.Y.S.2d 765 (App. Div. 2014) ................................. 26eBay Domestic Holdings, Inc. v. Newark , 16 A.3d 1 (Del. Ch. 2010) ............................................. 5 Edgar v. MITE Corp., 457 U.S. 624 (1982) ..................................................................................... 5Fieldstone Capital, Inc. v. Loeb Partners Realty, 105 A.D.3d 559, 963 N.Y.S.2d 120 (App. Div.

2013) ......................................................................................................................................... 3, 4Filler v. Hanvit Bank , 339 F. Supp. 2d 553 (S.D.N.Y. 2004), aff'd 156 F. App'x 413 (2d Cir.

2005) ........................................................................................................................................... 22

Fletcher v. Dakota, Inc., 99 A.D.3d 43, 948 N.Y.S.2d 263 (App. Div. 2012) ............................... 26 Hamlet at Willow Creek Dev. Co., LLC v. Ne. Land Dev. Corp., 64 A.D.3d 85, 878 N.Y.S.2d 97

(App. Div. 2009) ................................................................................................................... 18, 26 Hart v. General Motors, Corp., 129 A.D.2d 179, 517 N.Y.S.2d 490 (App. Div. 1987) .................. 5 Hecht v. Components Int'l, Inc., 22 Misc. 3d 360, 867 N.Y.S.2d 889 (Sup. Ct. 2008) .................. 18 Higgins v. New York Stock Exch., Inc., 10 Misc. 3d 257, 806 N.Y.S.2d 339 (Sup. Ct. 2005) ....... 20 In re PTMS Liquidating Corp., 452 B.R. 498 (Bankr. D. Del. 2011)................................... 6, 10, 15 In re Walt Disney Co. Derivative Litig., 906 A.2d 27 (Del. 2006) ................................................... 6 Ivanhoe Partners v. Newmont Mining Corp., 535 A.2d 1334 (Del. 1987) ....................................... 6Kahn v. Lynch Commc’n Sys., 638 A.2d 1110 (Del. 1994) .............................................................. 8Kahn v. M&F Worldwide Corp., 88 A.3d 635 (Del. 2014) ...................................................... 7, 8, 9

Kahn v. Tremont Corp., 694 A.2d 422 (Del. 1997) .................................................................. 7, 8, 9Kantor v. Mesibov, 8 Misc. 3d 722, 796 N.Y.S.2d 884 (Sup. Ct. 2005) ........................................ 14Kaufman v. Cohen, 307 A.D.2d 113, 760 N.Y.S.2d 157 (App. Div. 2003) ....................... 14, 15, 20Kavanaugh v. Kavanaugh, 226 N.Y. 185, 123 N.E. 148 (1919) ...................................................... 7Krys v. Butt , 486 F. App’x 153 (2d Cir. 2012) ............................................................................... 20Kurtz v. Zion, 61 A.D.2d 778, 402 N.Y.S.2d 402 (App. Div. 1978) .............................................. 28Kurz v. Holbrook , 989 A.2d 140 (Del. Ch. 2010), rev'd on other grounds, 992 A.2d 377 (Del.

2010) ............................................................................................................................................. 6



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Leve v. C. Itoh & Co., (Am.), 136 A.D.2d 477, 523 N.Y.S.2d 512 (App. Div. 1988) .................... 23 Lumex, Inc. v. Highsmith, 919 F. Supp. 624 (E.D.N.Y. 1996) ......................................................... 2 Lyondell Chem. Co. v. Ryan, 970 A.2d 235 (Del. 2009) .......................................................... 10, 11 Marx v. Akers, 88 N.Y.2d 189, 666 N.E.2d 1034 (1996) ................................................................. 8 Meridian Horizon Fund, LP v. KPMG (Cayman), 487 F. App'x 636 (2d Cir. 2012) ..................... 20

Mills Acquisition Co. v. Macmillan, Inc., 559 A.2d 1261 (Del. 1989) ..................................... 5, 6, 9 Morgenthau v. Erlbaum, 59 N.Y.2d 143, 464 N.Y.S.2d 392 (1983).............................................. 27 Nassau Roofing & Sheet Metal Co. v. Facilities Dev. Corp., 70 A.D.2d 1021, 418 N.Y.S.2d 216

(App. Div. 1979) ......................................................................................................................... 28O'Donnell v. Ferro, 303 A.D.2d 567, 756 N.Y.S.2d 485 (App. Div. 2003) .................................... 5Paramount Commc’ns, Inc. v. QVC Network, Inc., 637 A.2d 34 (Del. 1994)................................ 10Paramount Commc’ns, Inc. v. Time Inc., 571 A.2d. 1140 (Del. 1990) .......................................... 10Potter v. Arrington, 11 Misc. 3d 962, 810 N.Y.S.2d 312 (Sup. Ct. 2006) ....................................... 5 Reichman v. Reichman, 88 A.D.3d 680, 930 N.Y.S.2d 262 (App. Div. 2011) ................................ 4 Residential Bd. of Mgrs. of the Columbia Condominium v. Alden, 178 A.D.2d 121, 576 N.Y.S.2d

859 (App. Div. 1991). ................................................................................................................... 5

Rosenblatt v. Getty Oil Co., 493 A.2d 929 (Del. 1985) ................................................................ 7, 9Seneca Ins. Co. v. Lincolnshire Mgmt., Inc., 269 A.D.2d 274, 703 N.Y.S.2d 127 (App. Div. 2000)..................................................................................................................................................... 27

Sharp Int'l Corp. v. State Street Bank & Trust Co., 281 B.R. 506 (Bankr. E.D.N.Y. 2002) .......... 20Silverstein v. Marine Midland Trust Co. of N.Y., 1 A.D.2d 1037, 152 N.Y.S.2d 30 (App. Div.

1956) ........................................................................................................................................... 18Steed Finance LDC v. Laser Advisers, Inc., 258 F. Supp. 2d 272 (S.D.N.Y. 2003) ...................... 22Sterling v. Mayflower Hotel Corp., 93 A.2d 107 (Del. 1952) .......................................................... 9Stroud v. Grace, 606 A.2d 75 (Del. 1992) ...................................................................................... 13Tanzer Econ. Assocs., Inc. Profit Sharing Plan v. Universal Food Specialties, Inc., 87 Misc. 2d

167, 383 N.Y.S2d 472 (Sup. Ct. 1976) ......................................................................................... 6Telxon Corp. v. Meyerson, 802 A.2d 257 (Del. 2002).................................................................... 16Tierno v. Puglisi, 279 A.D.2d 836, 719 N.Y.S.2d 350 (App. Div. 2001) ........................................ 6Vanderminden v. Vanderminden, 226 A.D.2d 1037, 641 N.Y.S.2d 732 (App. Div. 1996) ... 2, 3, 27Vill. of Woodbury v. Brach, 99 A.D.3d 697, 952 N.Y.S.2d 92 (App. Div. 2012) .......................... 27Wechsler v. Bowman, 285 N.Y. 284, 34 N.E.2d 322 (1941) .......................................................... 20Weinberger v. UOP, 457 A.2d 701 (Del. 1983) ............................................................................... 8Wight v. Bankamerica Corp., 219 F.3d 79 (2d Cir. 2000) .............................................................. 22Yemini v. Goldberg, 60 A.D.3d 935, 876 N.Y.S.2d 89 (App. Div. 2009) .............................. 2, 3, 27 Zimmerman v. Crothrall, 62 A.3d 676 (Del. Ch. 2013) ................................................................... 6

Statutes C.P.L.R. § 3001............................................................................................................................... 27

C.P.L.R. § 6301......................................................................................................................... 1, 2, 4C.P.L.R. § 6311................................................................................................................................. 1C.P.L.R. § 6313......................................................................................................................... 1, 2, 4 N.Y. Bus. Corp. § 1317(a)(2) (McKinney’s 2014) ......................................................................... 17 N.Y. Bus. Corp. § 720(a)(1) (McKinney’s 2014) ..................................................................... 16, 17

Other Authorities Business Companies Act of 2004 (No. 16 of 2004) (as amended by No. 26 of 2005) (BVI) ........ 12





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PRELIMINARY STATEMENT

Plaintiff, Kevin Millien (“Millien” or “Plaintiff”), respectfully submits this memorandum

of law in support of his Application for a Preliminary Injunction and a Temporary Restraining

Order against Defendants George Popescu (“Popescu”), Currency Mountain Holdings, LLC

(“Currency Mountain”), Forexware, LLC (“Forexware”) and Emil Assentato (“Assentato”)

(Currency Mountain, Forexware, and Assentato collectively known as the “CM Defendants”), and

nominal Defendant Boston Technologies, Inc. (“BT”), pursuant to N.Y. C.P.L.R. §§ 6301, 6311,

6313. Plaintiff seeks injunctive relief in order to forestall any further action with respect to the

acquisition transaction between BT and its affiliate entities and Currency Mountain and its

subsidiary, Forexware (the “BT-CM Transaction”)1 pending a full adjudication of the merits of

this case. Without immediate relief, the Plaintiff and other minority shareholders of BT will be

substantially and irreparably prejudiced by the completion of a transaction that substantially

violates their rights and the value of their investments in BT and the BT Affiliates.

STATEMENT OF FACTS

For factual and background information, the Court is respectfully referred to the facts as

set forth in the Affidavit of Kevin Millien (“Affidavit”), attached hereto and incorporated herein.

ARGUMENT

I. TEMPORARY RESTRAINING ORDER IS NECESSARY TO PROTECT

PLAINTIFF’S AND OTHER MINORITY SHAREHOLDER’S INTERESTS

PRIOR TO A PRELIMINARY JUNCTION HEARING

The BT-CM Transaction recently entered into by Defendants constitutes a blatant

violation of the Plaintiff’s and other minority shareholders’ rights. A temporary restraining order

is thus necessary in order to prevent any further action on the BT-CM Transaction, and thus

1. See Exhibit Y for the announcement of the merger on the online news service Forex Magnates.



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prevent any immediate or further injury to Millien, pending a hearing on the preliminary

injunction. Plaintiff is entitled to a temporary restraining order to prevent any further action on

the transaction prior to a hearing on Plaintiff’s request for a preliminary junction. As far as the

Plaintiff is aware, the transaction is in the process of completion and prompt relief is necessary to

prevent immediate and irreparably injury to the Plaintiff’s rights.

A court may grant temporary restraining order “without notice” upon the filing of a

motion for a preliminary injunction “if . . . the plaintiff shall show that immediate and irreparable

injury, loss or damages will result unless the defendant is restrained before a heading can be had.”

C.P.L.R. § 6313; see also § 6301 (same). “Essential to a showing of irreparable harm is the

unavailability or at least inadequacy of a money damages award.” Lumex, Inc. v. Highsmith, 919

F. Supp. 624, 627 (E.D.N.Y. 1996) (emphasis added). See Datwani v. Datwani, 102 A.D.3d 616,

617, 959 N.Y.S.2d 153, 154 (App. Div. 2013) where irreparable harm found in the potential “sale

of [a party’s] shares to someone else” when the party was “engaged in a battle for corporate

control”; Yemini v. Goldberg, 60 A.D.3d 935, 937, 876 N.Y.S.2d 89, 91 (App. Div. 2009), where

“control and management of [an entity] and its holdings were at stake,” because “money damages

were not sufficient” in this sort of case; Vanderminden v. Vanderminden, 226 A.D.2d 1037, 1041,

641 N.Y.S.2d 732 (App. Div. 1996), where “an opportunity for defendants to shift the balance

power and assume management and control of the company”.

Popescu has entered into a transaction with the CM Defendants that will deprive Millien

not only of value of his investment in BT, but of a proper sale of the company that would obtain

greater value for his shares and that of the other minority holders than the transaction into which

Popescu entered. The BT-CM Transaction’s sale price is far below other offers Popescu received.

Millien will also be deprived of his management and controlling ownership over the BT



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Affiliates, as the BT Affiliates, or certain valuable assets thereof, are being transferred to

Currency Mountain as part of the BT-CM Transaction. Millien is a director of each of the

entities, and is rightfully a co-equal shareholder of BT Trading, the holding company that wholly

owns the other two BT Affiliates.2 Popescu purportedly effected an improper and wrongful

dilution of Millien’s 50% ownership stake in BT Trading in contravention of provisions in BT

Trading’s Articles of Associations that bar any such unilateral dilution.3 Popescu thus purports to

wrongfully usurp Millien’s right to control the entities in order to transfer the entities, or their

valuable assets to Currency Mountain pursuant to the BT-CM Transaction. As held in several

cases in New York, such loss of management and control cannot be compensated by monetary

damages, resulting in irreparable harm absent injunctive relief.

As the transfer of the assets of BT is currently in progress or completed, and the transfers

of the BT Affiliates, or their assets, are currently in progress, and likely to be completed soon, the

“immediate and irreparable injury, loss or damages” that Millien faces “will result unless the

defendant is restrained before a hearing can be had.” C.P.L.R. § 6313. A temporary restraining

order is thus necessary to immediately cease any further action in completing this transaction in

order for a hearing on preliminary relief to be conducted on the parties’ rights.

II. PRELIMINARY INJUNCTION IS NECESSARY TO PREVENT FURTHER

INJURY OR HARM TO PLAINTIFF’S AND OTHER MINORITY

SHAREHOLDER’S INTERESTS PENDING FURTHER PROCEEDINGS ON

PLAINTIFF’S CLAIMS

Plaintiff is entitled to a preliminary injunction against Defendants ordering Defendants to

2. See Exhibit R for Millien’s Share Certificate from BT Trading; Exhibit S for Popescu’s Share Certificatefrom BT Trading; Exhibit P for BT Trading’s Certificate of Incumbency, showing Millien and Popescu to hold thesame number of shares in and listing both as directors of BT Trading.3. See Articles of Association of BT Trading, Ltd., as amended Nov. 25, 2009 § 2.5 (“A company may not purchase, redeem or otherwise acquire and hold its own shares, without the consent of the member whose shares areto be purchased, redeemed or otherwise acquired, unless it is permitted in the Memorandum and Articles ofIncorporation or by restrictions in the share certificates.” (emphasis added)). A copy of the Memorandum andArticles of Association of BT Trading are attached as Exhibit T.



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refrain from any further action to consummate and complete the BT-CM Transaction.

A preliminary injunction protects the interests of a plaintiff while an action is pending

where defendant’s continued actions would harm “the plaintiff's rights respecting the subject of

the action,” and would “tend[] to render the judgment ineffectual.” C.P.L.R. § 6301; see also

Fieldstone Capital, Inc. v. Loeb Partners Realty, 105 A.D.3d 559, 560, 963 N.Y.S.2d 120, 122

(App. Div. 2013) (granting preliminary injunctive relief in part to “preserve the status quo”). A

preliminary injunction requires a showing of “(1) a likelihood of ultimate success on the merits,

(2) the prospect of irreparable injury if the provision relief is withheld, and (3) a balancing of the

equities in the movant’s favor.” Reichman v. Reichman, 88 A.D.3d 680, 681, 930 N.Y.S.2d 262,

263 (App. Div. 2011) (citations and quotations omitted). The “mere existence of an issue of fact

will not itself be grounds for denial of the motion.” Id . (quoting Arcamone–Makinano v. Britton

Prop., Inc., 83 A.D.3d 623, 625, 920 N.Y.S.2d 362 (App. Div. 2011)) (quotations omitted). “[A]

preliminary injunction is a provisional remedy. Its function is not to determine the ultimate rights

of the parties, but to maintain the status quo until there can be a full hearing on the merits.”

Residential Bd. of Mgrs. of the Columbia Condominium v. Alden, 178 A.D.2d 121, 122, 576

N.Y.S.2d 859, 861 (App. Div. 1991).

As demonstrated below, Plaintiff has met this burden and is entitled to preliminary relief.

a. Plaintiff is Likely to Succeed on the Merits

1. Popescu Breached his Fiduciary Duties

First, Defendant Popescu has violated his fiduciary duties to BT and the Plaintiff as a

former director and minority shareholder in entering into this transaction. Claims for breach of

fiduciary duty concern “matters peculiar to the relationships among or between the corporation

and its current officers, directors, and shareholders” and thus implicate the “internal affairs”



5

doctrine, Culligan Soft Water Co. v. Clayton Dubilier & Rice LLC , 118 A.D.3d 422, 422, 988

N.Y.S.2d 134 (App. Div. 2014) (citing Edgar v. MITE Corp., 457 U.S. 624, 645 (1982)), under

which the state of incorporation controls matters pertaining to the internal affairs of a company.

See, e.g., Potter v. Arrington, 11 Misc. 3d 962, 965, 810 N.Y.S.2d 312, 315 (Sup. Ct. 2006)

(finding in a derivative action for, inter alia, breach of fiduciary duties, “[i]t is generally held that

the state law of the state of incorporation is the law to be applied” (citing O'Donnell v. Ferro, 303

A.D.2d 567, 756 N.Y.S.2d 485 (App. Div. 2003); Hart v. General Motors, Corp., 129 A.D.2d

179, 183, 517 N.Y.S.2d 490 (App. Div. 1987))). As BT is a corporation organized under the laws

of Delaware, Delaware law controls the breach of fiduciary duty claims.

Under Delaware law, it is axiomatic that directors owe fiduciary duties to all shareholders

of a corporation. eBay Domestic Holdings, Inc. v. Newark , 16 A.3d 1, 26 (Del. Ch. 2010) (citing

Mills Acquisition Co. v. Macmillan, Inc., 559 A.2d 1261, 1280 (Del. 1989)). Furthermore,

controlling shareholders, whether or not they are directors, owe fiduciary duties to the minority

shareholders. Id . (citing Ivanhoe Partners v. Newmont Mining Corp., 535 A.2d 1334, 1344 (Del.

1987)). “A shareholder will be considered ‘controlling’ if,” inter alia, the shareholder “owns

more than 50% of the voting power of the company.” Zimmerman v. Crothrall, 62 A.3d 676, 699

(Del. Ch. 2013). Furthermore, “[f]iduciary duties apply regardless of whether a corporation is

‘registered and publicly traded, dark and delighted, or closely-held.’” Id . at 31 (quoting Kurz v.

Holbrook , 989 A.2d 140, 183 (Del. Ch. 2010), rev'd on other grounds, 992 A.2d 377 (Del.

2010)). Popescu was at all times a director of BT and as of March 5, 2014 became a controlling

shareholder with the addition of 1 share to his 50% share of the voting stock, thus obtaining more

than “50% of the voting power” of BT, owing Plaintiff and other minority shareholders fiduciary

duties as both a director and controlling shareholder. Zimmerman, 62 A.3d at 699.



6

Breach of Duty of Loyalty and Good Faith

A duty of loyalty “mandates” that for corporate fiduciaries “the best interest of the

corporation and its shareholders take precedence over any interest possessed by a director,

officer, or controlling shareholder, not shared by the stockholders generally.” In re PTMS

Liquidating Corp., 452 B.R. 498, 509 (Bankr. D. Del. 2011) (quoting Cede & Co. v. Technicolor,

Inc., 634 A.2d 345, 361 (Del. 1993)) (quotations omitted) (emphasis added). “[A]n officer or

director may breach the duty of good faith . . . if he ‘intentionally acts with a purpose other than

that of advancing the best interest of the corporation . . . acts with intent to violate applicable

positive law, or . . . intentionally fails to act in the face of a known duty to act , demonstrating a

conscious disregard for his duties.’” Id . (quoting In re Walt Disney Co. Derivative Litig., 906

A.2d 27, 67 (Del. 2006)) (emphasis added).4

In this case, the BT-CM Transaction implicates both a conflict of interest and a lack of

good faith on the part of Defendant Popescu. “Self-dealing” by a controller refers in part to

circumstances where “a controlling shareholder stands on both sides of the transaction.” Kahn v.

Tremont Corp., 694 A.2d 422, 428 (Del. 1997). Popescu has been appointed Head of Strategies

at Currency Mountain and received payments apart from the transaction from the CM Defendants

in contemplation of entering into the transaction. Plaintiff, who owns 47.48% of the total shares

in the company, received none of the proceeds. Furthermore, Popescu negotiated and entered into

4. New York follows similar principles. See, e.g., Tierno v. Puglisi, 279 A.D.2d 836, 838, 719 N.Y.S.2d 350,

353 (App. Div. 2001) (“Majority shareholders who have the power and authority to direct and control the affairs of acorporation have a fiduciary duty to all shareholders . . . .”); Tanzer Econ. Assocs., Inc. Profit Sharing Plan v.Universal Food Specialties, Inc., 87 Misc. 2d 167, 176, 383 N.Y.S2d 472, 479 (Sup. Ct. 1976) (“The basic principle . . . is always controlling, that a scheme conceived solely for the benefit of controlling shareholders withoutregard to the welfare of the corporation or of the minority constitutes a breach of the fiduciary obligation.” (citingKavanaugh v. Kavanaugh, 226 N.Y. 185, 123 N.E. 148 (1919))); Higgins v. New York Stock Exch., Inc., 10 Misc.3d 257, 278, 806 N.Y.S.2d 339, 357 (Sup. Ct. 2005) (noting in the context of the fiduciary duty of loyalty that“[d]irector conflicts are typically found where . . . a director stands to receive a personal benefit from thetransaction . . . that is different from that received by all the shareholders” (citing Marx v. Akers, 88 N.Y.2d 189,200–12, 666 N.E.2d 1034 (1996))).



7

a written expression of the intent to merge, or otherwise transact through an asset purchase, with

Currency Mountain as of May 1, 2014, when Millien was still a director. As a member of the

Board, Millien should never have been kept in the dark. Defendants should never have moved

forward with the transaction to such a stage without consideration of the BT Board, which would

have required disclosure to, and approval, of, Millien as a director.

“Where a transaction involving self-dealing by a controlling shareholder is challenged, the

applicable standard of review is ‘entire fairness,’ with defendants having the burden of

persuasion” to prove “that the transaction . . . was entirely fair to the minority stockholders.”

Kahn v. M&F Worldwide Corp., 88 A.3d 635, 642 (Del. 2014). The burden may be shifted to

plaintiffs to prove lack of fairness, but only in cases where the transactions is approved “by an

informed vote of the minority shareholders,” Rosenblatt v. Getty Oil Co., 493 A.2d 929, 937 (Del.

1985), or as a result of “the use of a well functioning committee of independent directors.”

Tremont Corp., 694 A.2d at 428 (citing Kahn v. Lynch Commc’n Sys., 638 A.2d 1110, 1117 (Del.

1994)). “[E]ntire fairness is the highest standard of review in corporate law” and “is applied in

the controller merger context as a substitute for the dual statutory protections of disinterested

board and stockholder approval, because both protections are potentially undermined by the

influence of the controller .” M&F Worldwide Corp., 88 A.3d. at 644 (emphasis added). Delaware

courts conduct “entire fairness” assessments under these circumstances in order “to ensure that

individuals who purport to act as fiduciaries in the face of conflicting loyalties exercise their

authority in light of what is best for all entities. Tremont Corp., 694 A.2d at 431 (citing

Weinberger v. UOP, 457 A.2d 701, 711 (Del. 1983)).

In this case, Popescu had a clear conflict of interest in unilaterally negotiating and entering

into the BT-CM Transaction, a deal that benefits Popescu personally while providing no benefit



8

to Plaintiff, a 47.48% shareholder of the company and that failed to serve the interests of the

company as a whole, obtaining a value in the acquisition sale of approximately $250,000, far less

than what other offers would have provided. The burden of proving entire fairness of the BT-CM

Transaction rests with the Defendants, as there was neither the approval of the minority

shareholders nor assessment by an independent group of directors. Furthermore, as a controller,

Popescu handled all aspects of the deal himself, leaving the BT-CM Transaction utterly devoid of

any “shareholder-protective characteristics.” Id . This is especially true given the fact that

Defendants had the ability to implement protective measures. Popescu negotiated and entered

into a written expression of the intent to merge, or otherwise transact through an asset purchase,

with Currency Mountain as of May 1, 2014, while Millien was still a director. As a minority

shareholder with the vast majority of minority shares, Millien could have served as an

independent reviewer and provided minority shareholder approval for the transaction. Therefore,

in this case, Defendants would shoulder the burden to prove entire fairness, and under these

circumstances Defendants are completely unable to do so.

An entire fairness analysis rests on “the dual components of fair dealing and fair price.”

Id . at 645 (emphasis added). “‘[F]air dealing’ focuses on the conduct of the corporate fiduciaries

in effectuating a transaction,” specifically, “how the purchase was initiated, negotiated, structured

and the manner in which director approval was obtained.” Tremont Corp., 694 A.2d at 430–31

(citing Mills Acquisition Co. v. Macmillan, Inc., 559 A.2d 1261, 1280 (Del. 1988)). “[F]airness”

with respect to price rests on whether “the minority shareholders [will] receive the substantial

equivalent in value of what [they] had before.” Rosenblatt , 493 A.2d at 940 (quoting Sterling v.

Mayflower Hotel Corp., 93 A.2d 107, 110 (Del. 1952)) (quotations omitted) (emphasis added).

In this case, Plaintiff, as a substantial minority shareholder, not only failed to receive “the



9

substantial equivalent of what he had before,” in receiving none of the proceeds and being left

with a substantial ownership share of a largely valueless entity, Plaintiff is also being further

deprived by the loss of the BT Affiliate entities. Id . Plaintiff is entitled to a co-equal ownership

share of the BT Affiliates as a result of being a 50% shareholder of BT Trading, the holding

company. Popescu has purportedly diluted Millien’s interests in BT Trading in contravention of

the entity’s Articles of Association in order to transfer the entities, or their assets, to Currency

Mountain. The selected price for the transaction, $250,000, rates horribly in comparison to the

BT’s profits and revenues and fails to reflect the sort of any “lengthy review” or “bargaining

between the parties” that has been found to support a finding of fair price against plaintiffs’

evidence to the contrary. Rosenblatt , 493 A.2d at 941–42. The BT-CM Transaction is a product

of blatant self-dealing by Popescu, with the position he has acquired in Currency Mountain, the

separate payment he received for entering into it, and the entitlement to Currency Mountain stock

or stock options. The low price Currency Mountain paid for BT’s assets, on the other hand,

providing a minimal return for the corporation as a whole, shows Popescu acted in bad faith in

entering into a transaction that clearly serves “a purpose other than that of advancing the best

interest of the corporation.” In re PTMS Liquidating Corp., 452 B.R. at 509 (citations omitted).

Defendant Popescu has thus violated his duty of loyalty and good faith to Millien and BT.

Revlon Duties

When, inter alia, a transaction entails a “sale or change of control,” Revlon “duties” are

implicated as part of a directors’ overall fiduciary responsibility to the company. Paramount

Commc’ns, Inc. v. QVC Network, Inc., 637 A.2d 34, 42–47 (Del. 1994); Paramount Commc’ns,

Inc. v. Time Inc., 571 A.2d. 1140, 1150 (Del. 1990). Revlon requires that directors “act[]

reasonably to seek the transaction offering the best value reasonably available to the



10

stockholders.” QVC , 637 A.2d at 43 (emphasis added). In other words, “[t]here is only one

Revlon duty—to ‘[get] the best price for the stockholders at a sale of the company.’” Lyondell

Chem. Co. v. Ryan, 970 A.2d 235, 242 (Del. 2009) (citations omitted). While “there is no single

blueprint,” reasonable actions such as reliance on outside expertise and value assessments, as well

as the lack of disloyalty is key to determining whether directors have complied with Revlon. Id . at

242–44 (citations and quotations omitted).

In this case, Revlon applies to the BT-CM Transaction as it involves “a sale of change or

control” of BT—the ownership of BT, or all of its valuable assets and staff, is being transferred to

Currency Mountain pursuant to a binding agreement. QVC , 637 A.2d at 42–47. Furthermore, the

valuable assets of the BT affiliates BT Prime and Boston Prime, the client accounts, are also in

the process of being transferred to Currency Mountain as part of the transaction. Applying the

Revlon standard, the sale price of approximately $250,000 grossly undervalues a company that

generated over $20 million in revenues and over $2 million in profits in the previous year.

Furthermore, Defendants went forward with the BT-CM Transaction despite much higher bids of

about $3.8 million for the company. Defendants’ actions in consummating this deal represent a

complete failure to “[get] the best price for the stockholders.” Lyondell, 970 A.2d at 242 (citations

and quotations omitted).

Popescu was a director and controlling shareholder. Despite this, he went forward with a

transaction involving self-dealing, conflicts of interest, an intentional lack of disclosure to a

minority shareholder with a substantial holding of and investment in the company, and a price far

below what the company should have been able, and could have been able, to obtain from a

different transaction. Popescu has thus blatantly violated his duties to BT’s shareholders and

entered a sale in contravention of his single Revlon duty to maximize value to the shareholders



11

from such a sale. In effect, Popescu exploited the result of the Delaware decision at the beginning

of this year to usurp the value of the company for himself and deny Millien and the other minority

shareholders any value of the company despite Millien’s substantial investment in the company.

Duties with Respect to the BT Affiliates

It should also be noted that similar duties attach to Popescu as director of the BT affiliates.

Article 9.2 of BT Prime’s Articles of Association provides in part that “[e]ach director shall

exercise his powers for a proper purpose and shall not act or agree to the Company acting in a

manner that contravenes the Memorandum, the Articles or the [British Virgin Islands (“BVI”)

Business Companies] Act” and that “[e]ach director, in exercising his powers or performing his

duties, shall act honestly and in good faith in what the director believes to be the best interests of

the Company” (emphasis added). This language effectively parrots Articles 120(1) and 121 of the

Business Companies Act of 2004 (No. 16 of 2004) (as amended by No. 26 of 2005) (BVI) 5.

Article 170 of the Act requires director approval of a “written plan of merger or consolidation”

and provides for member approval of any such transaction. Article 175 requires the same for an

asset-based transaction. Article 125 renders voidable that “a transaction entered into by a

company in respect of which a director is interested” except in cases where there has been proper

disclosure to the Board, the members knew “the material facts of the interest of the director” and

“approved or ratified” it, or “the company received fair value for the transaction.” Boston

Prime’s Articles of Association6 at Section 14 provide a procedure for director conflicts of

interest that discounts that the interested director’s vote unless there is company resolution

exempting the provision, the “interest cannot reasonably be regarded as likely to give rise to a

5. A copy of the Act is attached as Exhibit Z. See also Legislative Resources, BRITISH VIRGIN ISLANDS

FINANCIAL SERVICES COMMISSION (Jan. 1, 2006),http://www.bvifsc.vg/Home/LegislationResources/tabid/358/ctl/ArticleView/mid/1079/articleId/434/language/en-US/BVI-Business-Companies-Act-2004-with-2005-Amendments.aspx (accessed Oct. 22, 2014).



12

conflict of interest” or the interest “arises from a permitted cause.” BT Trading’s Articles of

Association7 provides in Articles 12.1 and 12.2 that an agreement or transaction is void or

voidable “if it is shown that at the time the agreement or transaction was authorized, approved or

ratified . . . the agreement or transaction was unfairly prejudicial to [ inter alia] one or more

members of the company . . . .”

In this case, the BT-CM Transaction involves the transfers of the BT Affiliates, or their

assets, to Currency Mountain, a business operating in New York, as part of a transaction in which

Popescu has a clear inherent conflict of interest. The transaction is highly prejudicial and

detrimental to the Plaintiff’s interest in the companies, given the fact that (1) Millien is receiving

neither any the proceeds of the transaction or the fair value for his investment, and (2) Millien is

losing the right to control and manage the entities. Thus Popescu, as a director of all of the BT

Affiliates, has violated various sections of each of BT Affiliates’ Articles of Association 8 and

acted in direct contravention of his duties as director to each company.

Duty of Disclosure

“Delaware law imposes upon a board of directors the fiduciary duty to disclose fully and

fairly all material facts within its control that would have a significant effect upon a stockholder

vote.” Stroud v. Grace, 606 A.2d 75, 85 (Del. 1992) (citations omitted) (emphasis added).

Information is “material,” and therefore subject to a duty to disclose, if there is “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 made available.” Id . (citing

Arnold v. Soc’y for Sav. Bancorp, Inc., 650 A.2d 1270, 1277 (Del. 1994)).

The BT-CM Transaction involves such substantial consequences to the value of the

6. A copy is attached as Exhibit K.7. A copy is attached as Exhibit T.



13

company and a major impact on shareholder rights that the “omitted fact[s] [of the transaction]

would have assumed actual significance in the deliberations of the reasonable shareholder,” in

Millien’s position, in taking action to assert and protect his or her rights. Arnold , 650 A.2d at

1277. Popescu, in spite of a fiduciary duty to minority shareholders as BT’s controlling

shareholder and as a director of BT to disclose such material information, failed to disclose any

information at all regarding the BT-CM Transaction to Millien, as Millien only discovered the

transaction was occurring from outside sources. Popescu thus violated his duty to disclose as

director and controlling shareholder with respect to Millien as a minority shareholder.

Monetary Liability

Money damages are appropriate in this case. Any exculpatory provision permitted under

Delaware exempting directors from monetary liability excludes “any breach of the director’s duty

of loyalty” and “acts or omissions not in good faith or which involve intentional misconduct or a

knowing violation of the law.” Arnold , 650 A.2d at 1286–87 (emphasis added). As Popescu had

committed acts violating his duty of loyalty and contrary to good faith, the exculpatory provision

in BT’s certificate of incorporation would not exempt Popescu from monetary liability.

For the foregoing reasons, it is thus highly likely that Millien will prevail on the merits of

his breach of fiduciary claims against the Defendants.

2.

Popescu Committed Misrepresentation and Fraud

In negotiating and entering into the BT-CM Transaction, Popescu has committed fraud

and misrepresentation against Millien, resulting in substantial injury.

Fraud requires (1) “a representation of material fact,” (2) “the falsity of the

representation,” (3) “knowledge by the party making the representation that it was false when

8. See note 3 and accompanying text.



14

made,” or scienter, (4) “justifiable reliance by the plaintiff,” and (5) “resulting injury.” Kaufman

v. Cohen, 307 A.D.2d 113, 119, 760 N.Y.S.2d 157, 165 (App. Div. 2003). “[A] fraud cause of

action may be predicated on acts of concealment where the defendant had a duty to disclose the

information.” Id . at 119–20, 760 N.Y.S.2d 157, 165; see also Kantor v. Mesibov, 8 Misc. 3d 722,

729, 796 N.Y.S.2d 884, 891 (Sup. Ct. 2005) (“The suppression of material facts which a person,

in good faith, is bound to disclose is evidence of, and equivalent to, a false representation.”

(emphasis added)). This is particularly applicable to the context of a “fiduciary relationship”

where simply “the mere failure to disclose facts which one is required to disclose may constitute

actual fraud, provided the fiduciary possesses the requisite intent to deceive.” Kaufman, 307

A.D.2d at 119, 760 N.Y.S.2d 157, 165. (citations and quotations omitted).

First, Defendant Popescu had a duty to disclose, and knowingly failed to disclose, material

information thus meeting the first three elements of a fraud cause of action. Where a fiduciary

took a step in contravention of a fiduciary duty to “disclose [an] opportunity” to other partners

“knowingly” and “intentionally” in order to make use of the opportunity with third parties, the

court found such “allegations” to be “not merely incidental to the breach of fiduciary duty claim”

but “instead . . . a valid cause of action for actual fraud.” Id . at 120, 760 N.Y.S.2d 157, 166. In

this case, Popescu negotiated a significant asset-based transaction to dispose of valuable assets, or

otherwise all or substantially all of the assets, of BT and the BT Affiliates. It is thus highly

inferable that Popescu knowingly and intentionally excluded Millien from the process and

knowingly and intentionally concealed the information of the pending transaction from Millien,

both as a minority shareholder and as a former director at the time the Defendants entered into a

written expression of intent to merge. Popescu also knowingly excluded Millien as a director and

co-equal owner of the BT Affiliates even though substantial value of the overall business lies in



15

the client accounts of the BT Affiliates and these entities or their assets are an integral part of the

BT-CM Transaction. It is also highly inferable that Popescu intentionally kept Millien in the dark

in order to go through with the transaction, achieving his personal ends and receiving numerous

personal benefits, to the detriment of Millien and the company as a whole.

Second, Millien justifiably relied on Popescu’s non-disclosure of the material information

at issue here in that New York and Delaware recognizes “that a fiduciary owes a duty of

undivided and undiluted loyalty to those whose interests the fiduciary is to protect” and that this

rule “bar[s] not only blatant self-dealing, but also requir[es] avoidance of situations in which a

fiduciary’s personal interest possibly conflicts with the interests of those owed a fiduciary duty.”

Birnbaum v. Birnbaum, 73 N.Y.2d 461, 466, 541 N.Y.S.2d 746, 539 (1989); see also In re PTMS

Liquidating Corp., 452 B.R. 498, 509 (Bankr. D. Del. 2011) (quotations omitted) (summarizing

the duty of loyalty and good faith owed by directors). As established above, the companies’ own

organizational documents provide for similar duties. Even though Millien suffered a setback with

the Delaware decision in becoming a minority shareholder, when he was formerly an co-

controller with Popescu, he could justifiably rely on the fact that Popescu, in his continued role as

director and in his new role as a controlling shareholder, would follow bedrock fiduciary

principles of Delaware corporate law and act in accordance with the organizational documents of

the entities he had co-founded. It would generally be considered in Popescu’s best interests to do

so—directors have a strong interest to avoid intentionally failing to act in accordance with the

duty of loyalty in engaging in an “interested transaction,” as such transactions “lie outside the

business judgment rule’s presumptive protection,” Telxon Corp. v. Meyerson, 802 A.2d 257, 265

(Del. 2002), and cannot be exculpated from monetary liability. Arnold v. Soc’y for Sav. Bancorp,

Inc., 650 A.2d 1270, 1286–87 (Del. 1994).



16

Finally, Millien will suffer substantial injury to the loss of any value for his investment,

the loss of any opportunity to receive fair value for his investment in the company and the

exorbitant injury to his management and control of the affiliate entities.

In the alternative, there is ample support to show based on the foregoing that Defendant

Popescu engaged in misrepresentation to the detriment of Millien.

Thus, Millien is likely to prevail on the merits of his fraud or misrepresentation claims.

3. Popescu is Liable for Wasteful and Unlawful Conveyance

Defendant Popescu has entered into a wasteful and unlawful conveyance in contravention

of Section 720 of New York’s Business Corporation Law (“BCL”).

A claim for wasteful and unlawful conveyance under the BCL is not subject to the internal

affairs doctrine. See, e.g., Culligan Soft Water Co. v. Clayton Dubilier & Rice LLC , 118 A.D.3d

422, 423, 988 N.Y.S.2d 134 (App. Div. 2014) (“[BCL] § 720 (e.g. waste and unlawful

conveyance) . . . is made applicable to foreign corporations doing business in New York by

[BCL] § 1317(a)(2) [and] those claims are also governed by New York law.”); N.Y. Bus. Corp. §

1317(a)(2) (McKinney’s 2014) (“Except as otherwise provided in this chapter, the directors and

officers of a foreign corporation doing business in this state are subject, to the same extent as

directors and officers of a domestic corporation, to the provisions of . . . Section 720”). Section

720 provides in pertinent part that

[a]n action may be brought against one or more directors or officers of acorporation to procure a judgment . . . to compel the defendant to account for hisofficial conduct in the following cases:

(A) neglect of, or failure to perform, or other violation of his duties in themanagement and disposition of corporate assets committed to his charge.

(B) The acquisition by himself, transfer to others, loss or waste ofcorporate assets due to any neglect of, or failure to perform, or other violation ofhis duties.

N.Y. Bus. Corp. § 720(a)(1).



17

Although Section 720 applies here despite the internal affairs doctrine, the duties to which

Section 720 refers to are informed by Delaware law, as the duties Defendant Popescu has violated

are his fiduciary duties. As provided above, Popescu has violated his duties of loyalty, good faith

and disclosure under Delaware law “in the management and disposition of corporate assets

committed to his charge” as a director and controller over BT and the BT Affiliates by entering

into the BT-CM Transaction for a purpose other than the companies’ best interests and indeed to

the detriment of the other shareholders of these entities. Id . Thus Defendant Popescu has violated

Section 720 and must be held “to account for his official conduct” in entering into this

transaction, with proper relief flowing to the injured shareholders. Id .

Thus, Millien is likely to prevail on his claim for wasteful and unlawful

conveyance under the BCL.

4. Popescu Committed Conversion

As part of the BT-CM Transaction, Defendant Popescu has actively converted Millien’s

rights in the BT Affiliates as well as his entitlement to the value of his investment in BT.

“To establish . . . conversion . . . [a party] must demonstrate [1] ‘legal ownership or an

immediate superior right of possession to a specific identifiable thing and [2] must show that the

defendant exercised an unauthorized dominion over the thing in question . . . to the exclusion of

the plaintiff's rights.’” Hamlet at Willow Creek Dev. Co., LLC v. Ne. Land Dev. Corp., 64 A.D.3d

85, 113, 878 N.Y.S.2d 97, 118 (App. Div. 2009) (citations and internal quotations omitted); see

also Colavito v. New York Organ Donor Network, Inc., 8 N.Y.3d 43, 50, 860 N.E.2d 713, 717

(2006) (same). Conversion may be established by, inter alia, a defendant removing more

material over which the plaintiff had ownership than was contractually permitted by an agreement

between the parties, see, e.g., Hamlet at Willow Creek Dev. Co., 64 A.D.3d at 114–15, 878



18

N.Y.S.2d 97, 118–19, “[w]hen funds are provided for a particular purpose,” and a defendant uses

such funds for “an unauthorized purpose,” Hecht v. Components Int'l, Inc., 22 Misc. 3d 360, 367,

867 N.Y.S.2d 889, 897 (Sup. Ct. 2008), and the “wrongful[] with[olding] [of] possession of

shares of stock owned by [the aggrieved party] in a corporation of which [the parties] were sole

stockholders, officers, and directors.” Silverstein v. Marine Midland Trust Co. of N.Y., 1 A.D.2d

1037, 1038, 152 N.Y.S.2d 30, 31 (App. Div. 1956).

In this case, Defendant Popescu has purported to dilute Millien’s shares in BT Trading, in

violation of the entity’s Articles of Association, in order to unilaterally dispose of the BT

Affiliates, or at least their valuable assets, in defiance of Millien’s right to equal ownership over

the entities and their assets. Furthermore, Popescu’s actions have effectively usurped Millien’s

equal right to manage and control the entities and the disposition of their assets. Furthermore,

Popescu’s actions have effectively deprived Millien of the value of his shares in BT, by

unilaterally transacting with BT in the BT-CM Transaction and denying Millien any of the

proceeds of the transaction, to which he his entitled as a substantial minority shareholder with

47.48% of the outstanding shares in BT. Popescu’s conduct in entering into the BT-CM

Transaction thus amounts to a conversion of Millien’s rights to manage and control the BT

Affiliates, a conversion of Millien’s ownership interest in the BT Affiliates, and a conversion of

the proceeds of a transaction with BT or the value of Millien’s BT shares.

It is thus likely that Millien will prevail on his conversion claim.

5. Popescu was Unjustly Enriched

An unjust enrichment claim is shown by: “(1) the defendant was enriched; (2) enrichment

was at plaintiff's expense; and (3) the defendant's retention of the benefit would be unjust.” Dubai

Islamic Bank v. Citibank, N.A., 126 F. Supp. 2d 659, 669 (S.D.N.Y.2000). “This claim, unlike a



19

claim for conversion, does not require proof of a wrongful act by the defendant.” Hamlet at

Willow Creek Dev. Co., LLC v. Ne. Land Dev. Corp., 64 A.D.3d 85, 115, 878 N.Y.S.2d 97, 119

(App. Div. 2009).

In this case, Defendant Popescu unilaterally entered into the BT-CM Transaction and

decided to exclude Millien, a substantially minority shareholder of BT, from receipt of any of the

proceeds. Popescu has further sought to unilaterally dispose of the BT Affiliates, or their

valuable assets (in the form of client accounts), pursuant to this transaction when Millien is

entitled to equal ownership and control of the BT Affiliates. Permitting Popescu to retain the

benefits of this transaction would be unjust, as Millien is left with shares of largely valueless

entities, whose assets are being transferred to Currency Mountain, and receives none of the

proceeds. Furthermore, the value of the business rests largely on the substantial investment and

several years of work contributed by Millien, and as a result of this transaction Millien will be

effectively deprived of any benefit or value for this investment or these efforts.

Therefore, Millien is likely to prevail on his claim for unjust enrichment.

6.

Currency Mountain, Forexware, and Assentato Aided and Abetted Popescu’s Breach of

Fiduciary Duty

“A claim for aiding and abetting a breach of fiduciary duty requires: (1) a breach by a

fiduciary of obligations to another, (2) that the defendant knowingly induced or participated in the

breach, and (3) that plaintiff suffered damage as a result of the breach.” Kaufman v. Cohen, 307

A.D.2d 113, 125, 760 N.Y.S.2d 157, 169 (App. Div. 2003) (citations omitted); see also Meridian

Horizon Fund, LP v. KPMG (Cayman), 487 F. App'x 636, 642 (2d Cir. 2012) (“New York law

[also] recognizes a cause of action for aiding and abetting another's breach of fiduciary duty”

(quoting Krys v. Butt , 486 F. App’x 153, 157 (2d Cir. 2012)) (quotations omitted)). “[A] plaintiff

is not required to allege that the aider and abettor had an intent to harm, [but] there must be an



20

allegation that such defendant had actual knowledge of the breach of duty” by the fiduciary.

Kaufman, 307 A.D.2d at 125, 760 N.Y.S.2d 157, 169 (citations omitted). There must also be a

showing that the defendant “provide[d] ‘substantial assistance’ to the primary violator,” which

“occurs when a defendant affirmatively assists, helps conceal or fails to act when required to do

so, thereby enabling the breach to occur .” Id . at 126, 760 N.Y.S.2d 157 (citations omitted)

(emphasis added). A defendant is found liable for aiding and abetting “is liable for the full

amount of the damage.” Higgins v. New York Stock Exch., Inc., 10 Misc. 3d 257, 287, 806

N.Y.S.2d 339, 364 (Sup. Ct. 2005) (citation and quotations omitted).

As demonstrated above, Defendant Popescu has breached his fiduciary duty of loyalty and

good faith, including disclosure and Revlon duties with respect to the sale of a company, in

entering into the BT-CM Transaction. The CM Defendants substantially participated in and

assisted with the transaction by negotiating directly with Popescu with regard to the transaction

and entering into a binding agreement with Popescu alone, from which Popescu would derive the

proceeds and benefits to the complete exclusion of Millien despite his 47.48% share of BT and

equal ownership of the BT Affiliates. The crux of the aiding and abetting claim rests on the

knowledge of the aider and abettor. In this case, Millien only became aware of the BT-CM

Transaction through Assentato of Currency Mountain after the Defendants had entered into a

binding agreement. In fact, it was Assentato that told Millien that Popescu was not going to

provide him any proceeds from the sale. Assentato further revealed to Millien that he was aware

of Popescu’s purported dilution of Millien’s shares in BT Trading. Nonetheless, the CM

Defendants entered into a written expression of the intent to merge or transact in early May, while

Millien was a director and without his approval, and then entered into a binding agreement with

Popescu to acquire BT and its affiliate entities, knowing that Popescu had not informed Millien



21

and was not going to inform him and that Popescu was not going to share any proceeds with

Millien. It is thus highly inferable that the CM Defendants had actual knowledge of Popescu’s

breach of fiduciary duties in negotiating and entering into the BT-CM Transaction, and thus aided

and abetted Popescu’s breach of duties in working with Popescu alone and entering into the

transaction with him alone, to the detriment of Plaintiff and BT’s other minority shareholders.

Thus, Millien likely will prevail on his claim against the CM Defendants for aiding and

abetting a breach of fiduciary duties.

7. Currency Mountain, Forexware, and Assentato Aided and Abetted Popescu’s

Misrepresentation and Fraud

“To state a claim for aiding and abetting fraud under New York law, a plaintiff must

show: (1) the existence of an underlying fraud; (2) that the defendant had knowledge of the fraud;

and (3) that the defendant provided substantial assistance to advance the commission of the

fraud.” Filler v. Hanvit Bank , 339 F. Supp. 2d 553, 557 (S.D.N.Y. 2004), aff'd 156 F. App'x 413

(2d Cir. 2005) (citing Wight v. Bankamerica Corp., 219 F.3d 79, 91 (2d Cir. 2000)). In order to

effectively establish an aiding and abetting claim, a plaintiff must “show that the defendant had

actual knowledge of the underlying fraud.” Id . (citing Steed Finance LDC v. Laser Advisers, Inc.,

258 F. Supp. 2d 272, 282 (S.D.N.Y. 2003)). “A defendant substantially assists the commission of

a fraud when it ‘affirmatively assists, helps conceal, or by virtue of failing to act when required to

do so enables the fraud to proceed,’ and when its ‘actions ... proximately cause[ ] the harm on

which the primary liability is predicated.’” Id . (quoting Cromer Fin. Ltd. v. Berger, 137 F. Supp.

2d 452, 470 (S.D.N.Y. 2001)).

As established above, Defendant Popescu committed acts of misrepresentation and fraud

against Millien in knowingly concealing information concerning the BT-CM Transaction when

Popescu had a duty to disclose the information as a director and controlling shareholder of BT to



22

Millien as formerly a co-director and at all times a shareholder. The CM Defendants were fully

aware of Popescu’s knowing concealment of such material information in that the CM

Defendants entered the transaction knowing Millien was not involved and yet knowing that

Millien was a substantial shareholder. It was Assentato that initially revealed to Millien that BT

had entered into a transaction with Currency Mountain and Forexware. Assentato further

revealed to Millien that he knew of Popescu’s intent or purported efforts to dilute Millien’s shares

in BT Trading and that Popescu had no intention of sharing any of the proceeds with Millien.

Assentato also offered to provide proceeds to Millien, yet only if Millien were to enter into a

binding agreement to waive any right to bring legal action against either Currency Mountain and

its affiliates or BT and its affiliates.9

In “substantially assist[ing]” the fraud, id ., the CM Defendants agreed to enter into the

transaction knowing Millien was uninformed at the time and failed to reveal to Millien the fact

that the parties had entered into the transaction until after the parties had entered a binding

agreement. Assentato approached Millien on his own for his own purposes, as he was in part

seeking new leadership for BT once merged with Forexware (besides Popescu). At this stage,

Millien’s rights with respect to the transaction had already been limited by Popescu’s actions, as

assisted by the CM Defendants, and the only value he could hope to extract would be from

Assentato, under the conditions Assentato dictated at that time. His rights of equal ownership and

management of the BT Affiliates were also threatened and potentially compromised. The CM

Defendants thus have aided and abetted Popescu in perpetrating misrepresentation and fraud

against Millien, resulting in injury to Millien.

Therefore, Millien likely will prevail on his claim against the CM Defendants for aiding

9. See Exhibit X for a screenshot of the message sent by Assentato to Millien reflecting these terms.



23

and abetting fraud or misrepresentation.

8. Currency Mountain, Forexware, and Assentato Aided and Abetted Popescu’s Conversion

An aiding and abetting of conversion claim requires “(1) the existence of wrongful

conduct by the primary wrongdoer; (2) [defendant’s] knowledge of the wrongful conduct; and (3)

[defendant’s] substantial assistance in achieving the wrongdoing.” Diamond States Ins. Co. v.

Worldwide Weather Trading LLC , No. 02 CIV 2900 LLM GWG, 2002 WL 31819217 at *6

(S.D.N.Y. Dec. 16, 2002). Aiding and abetting conversion may be shown by finding that the

primary wrongdoer converted property, the secondary wrongdoer received the property, and

“under the circumstances” the secondary wrongdoer “knew the [property] that he was receiving,

at the time he received, to be the [property] belonging to [the aggrieved party].” Leve v. C. Itoh &

Co., (Am.), 136 A.D.2d 477, 478, 523 N.Y.S.2d 512, 513 (App. Div. 1988).

As established above, pursuant to the BT-CM Transaction, the BT Affiliates or their assets

are in the process of being transferred to Currency Mountain, in contravention of Millien’s right

to equal ownership and control of the BT Affiliates. Defendant Popescu has effectively converted

Millien’s interests in and management rights over these entities, and as the willing receiver of this

property, the CM Defendants have “substantial[ly] assist[ed] in achieving the wrongdoing.”

Diamond States Ins. Co., No. 02 CIV 2900 LLM GWG, 2002 WL 31819217 at *6. The CM

Defendants were also fully aware of Popescu’s wrongful conduct, as Assentato himself revealed

to Millien that he was aware of Popescu’s intent or purported efforts to dilute Millien’s shares in

BT Trading from the equal ownership level established from the inception of BT Trading in 2009.

It is thus likely that Millien will prevail on his claim for aiding and abetting conversion

against the CM Defendants.



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9. Currency Mountain, Forexware, and Assentato Committed Tortious Interference with

Business Relations against the Plaintiff

The CM Defendants have tortiously interfered with Millien’s business relations with BT

and the BT Affiliates as a shareholder of all of the entities and a director of certain entities.

A “tortious interference with business relations in New York,” requires a plaintiff to show:

(1) that it had a business relationship with a third party; (2) that the defendantknew of that relationship and intentionally interfered with it; (3) that thedefendant acted solely out of malice or used improper or illegal means thatamounted to a crime or independent tort; and (4) that the defendant's interferencecaused injury to the relationship with the third party.”

Amaranth LLC v. J.P. Morgan Chase & Co., 71 A.D.3d 40, 47, 888 N.Y.S.2d 489 (App. Div.

2009). “Unlawful and improper” in this context means requires that “defendant’s conduct must

amount to a crime or an independent tort.” Carvel Corp. v. Noonan, 3 N.Y.3d 182, 190, 818

N.E.2d 1100 (2004) .

In this case, Plaintiff has shown each of these elements. First, Millien, as a shareholder of

BT and of BT Trading, the holding company for Boston Prime and BT Prime, has existing

business relations with BT and the BT Affiliates. Second, as established above, the CM

Defendants, as revealed through Assentato’s discussions with Millien and the information he

revealed to Millien, were fully aware of Millien’s relationships with each of these entities and

intentionally interfered with these relationships by transacting with Defendant Popescu alone,

despite being fully aware of Millien’s role as a shareholder and formerly as a BT director and

director of each of the BT Affiliates as the transaction was being negotiated and when the parties

entered into a written expression of the mutual intent to merge. Third, the CM Defendants

engaged in independently tortious conduct through aiding and abetting Defendant Popescu’s

breach of fiduciary duty, fraud or misrepresentation, or conversion. Fourth, Millien has suffered

injury in that (1) he has received no proceeds from the transaction and would only receive any



25

proceeds under terms dictated by Assentato, including a severe limitation on Millien’s legal

rights, (2) Millien is deprived of potentially greater value for his shares in the form of a

transaction that more appropriately valued the company than the BT-CM Transaction, and (3)

Millien is deprived of his equal right to ownership and management of the BT Affiliates, as the

CM Defendants are in the process of acquiring the BT Affiliates, or their assets, solely with the

approval of Defendant Popescu and without the consent of Millien.

Therefore, Millien is likely to prevail on his claim against the CM Defendants for tortious

interference of business relations.

10.

Individual Defendant Assentato is Personally Liable for Currency Mountain’s andForexware’s Torts

Assentato should be held liable for the tortious actions of Currency Mountain in entering

into the BT-CM Transaction.

“[A]lthough participation in a breach of contract will typically not give rise to individual

director liability, the participation of an individual director in a corporation's tort is sufficient to

give rise to individual liability.” Fletcher v. Dakota, Inc., 99 A.D.3d 43, 47, 948 N.Y.S.2d 263

(App. Div. 2012). Furthermore, “[a] corporate officer may be liable for torts committed by or for

the benefit of the corporation if the officer participated in their commission.” Hamlet at Willow

Creek Dev. Co., LLC v. Ne. Land Dev. Corp., 64 A.D.3d 85, 116, 878 N.Y.S.2d 97 (App. Div.

2009) (citations omitted); see also Fletcher , 99 A.D.3d at 49, 948 N.Y.S.2d 263 (“[I]t has long

been held by this Court that ‘a corporate officer who participates in the commission of a tort may

be held individually liable, . . . regardless of whether the corporate veil is pierced’” (citations

omitted)).

As Assentato is the controller of, a director of, and the chief executive officer of Currency

Mountain, to the extent any tortious conduct may be attributable to Currency Mountain in aiding



26

and abetting Popescu’s breach of fiduciary duty, misrepresentation, fraud, and conversion instead

of directly to Assentato, Assentato should be individually liable for the entity Defendants’ tortious

acts as a director and corporate officer without any need to refer to a veil-piercing analysis. Id .

11.

Plaintiff is Entitled to Declaratory Judgment

Plaintiff has demonstrated an effective claim for declaratory relief.

“Pursuant to CPLR [§] 3001, ‘[t]he supreme court may render a declaratory

judgment . . . as to the rights and other legal relations of the parties to a justiciable

controversy,’ . . . for the primary purpose of ‘stabiliz[ing] an uncertain or disputed jural

relationship with respect to present or prospective obligations.’” Dupigny v. St. Louis, 115 A.D.3d

638, 981 N.Y.S.2d 765, 767–68 (App. Div. 2014) (quoting Chanos v. MADAC , LLC, 74 A.D.3d

1007, 1008, 903 N.Y.S.2d 506 (App. Div. 2010)). While it is the sound discretion of the court to

grant declaratory relief, a party may state allegations in its pleadings “sufficient to invoke the

Supreme Court’s power to render a declaratory judgment” with respect to the parties’ rights as

issue. Vill. of Woodbury v. Brach, 99 A.D.3d 697, 699–700, 952 N.Y.S.2d 92, 94 (App. Div.

2012). Furthermore, the existence of an alternative remedy would not necessarily preclude a

declaratory judgment where “a genuine, justiciable controversy exists.” Seneca Ins. Co. v.

Lincolnshire Mgmt., Inc., 269 A.D.2d 274, 275, 703 N.Y.S.2d 127, 129 (App. Div. 2000) (citing

C.P.L.R. § 3001; Morgenthau v. Erlbaum, 59 N.Y.2d 143, 148, 464 N.Y.S.2d 392 (1983)).

In this case, there is a justiciable controversy concerning Millien’s rights to the value of

his investments in BT and the BT Affiliates as well as Millien’s rights to control and manage the

BT Affiliates. The Defendants have acted in contravention of these rights in entering into the BT-

CM Transaction and have sought to avoid any recognition of Millien’s rights in moving to

consummate the transaction despite the fact that involves assets and entities over which Millien



27

has a right to manage and control.

Millien is thus entitled to declaratory relief against all of the Defendants.

b. Plaintiff and Other Minority Shareholders will Suffer Irreparable Injury Absent an

Injunction

As established in Part I,10

Plaintiff has demonstrated that completion of the BT-CM

Transaction will result in the loss of his management and control of the affiliate entities as well as

the unquantifiable value of his investment in these entities based on the extent to which his

control over the business has been compromised by this wrongful transaction. In New York, such

a loss of management and control and consequent inadequacy of monetary damages, suffices to

show irreparable harm absent relief. Yemini v. Goldberg, 60 A.D.3d 935, 937, 876 N.Y.S.2d 89,

91 (App. Div. 2009); Vanderminden v. Vanderminden, 226 A.D.2d 1037, 1041, 641 N.Y.S.2d 732

(App. Div. 1996). As the transaction is ongoing at this time, with the transfer of assets in

progress and likely to be completed and inseparable before any final relief may be granted, the

Plaintiff will suffer irreparable harm in his ownership and control over the business absent

preliminary injunctive relief restraining any further activity on this transaction.

c. Balance of Equities Favors Plaintiff and other Minority Shareholders in Preventing

the Loss and Harm that will Result to Minority Shareholders without Preliminary

Injunctive Relief

A balance of equities analysis rest on the relative prejudice each party will experience

from the motion. The equities weigh in “favor[] the plaintiff” where “the irreparable injury to be

sustained by the plaintiff is more burdensome to it than the harm caused to defendant[s] through

imposition of the injunction.” Burmax Co. v. B & S Indus., Inc., 135 A.D.2d 599, 601, 522

N.Y.S.2d 177, 179 (App. Div. 1987) (quoting Nassau Roofing & Sheet Metal Co. v. Facilities

Dev. Corp., 70 A.D.2d 1021, 1022, 418 N.Y.S.2d 216 (App. Div. 1979)) (quotations omitted); see

10. See supra page 4 (providing for a temporary restraining order based on a showing of immediate irreparable



28

also Kurtz v. Zion, 61 A.D.2d 778, 779, 402 N.Y.S.2d 402 (App. Div. 1978) (granting a

preliminary injunction, noting “it appears that the damage to plaintiffs from denial . . . would

cause substantially greater harm to plaintiffs if they are ultimately proved right . . . than the

harm that would be caused to said defendants by . . . granting [it] if . . . defendants are ultimately

proved right”).

In this case, Plaintiff will suffer substantial detriment absent preliminary relief. The

Defendants have entered in the BT-CM Transaction and are in the process of transferring assets

and merging BT into Currency Mountain, and transferring the BT Affiliates or their assets to

Currency Mountain. Millien previously attempted to forestall a key component of his transaction

by proceeding in the Supreme Court of Belize to secure his rights in BT Trading, the holding

company for the other BT Affiliates.11 The preliminary relief he has thus far obtained from the

Belize court is limited, however, and the benefit of any final relief from the Belize court, in which

Millien’s action is pending, may be fully undermined by the consummation of the BT-CM

Transaction prior to the Belize court’s final decision. The transaction is thus compromising not

only Millien’s substantial ownership interest in BT, with the company grossly undervalued in the

BT-CM Transaction and Millien intentionally deprived of the proceeds by Popescu, but also more

egregiously his right to equal ownership of and control over the BT Affiliates and their assets,

including the valuable assets of the client accounts. Additionally, the two other minority

shareholders have been deprived of fair value for their shares and will lose any opportunity to

obtain real value for their investment if the BT-CM Transaction is permitted to proceed.

On the other hand, the relative prejudice to the Defendants is minimal. BT operates with

relative independence, even under the auspices of Currency Mountain, as in effect a service

harm without relief).11. For the injunctive orders Millien obtained against Popescu, BT Trading, and Alpha Services Ltd. from the



provider for the BT Prime and Boston Prime. BT Prime and Boston Prime serve as trading

platforms for the customers of the business, and operate independently of BT through individual

inter-company agreements with BT. Thus BT and the BT Affiliates may continue to operate even

if the transaction is put on hold. The BT-CM Transaction is currently in progress and has yet to

be fully completed, which is projected to take at least a few months from this point in time. Thus,

preliminary relief would only serve to keep the transaction from moving further, pending a full

hearing on the merits, while if in the unlikely case that Defendants were to prevail, they could

continue with the process at a later point.

Thus, the balance of equities clearly weighs in favor of the Plaintiff, given the substantial

irrevocable harm that will ensue to the Plaintiff and other minority shareholders Plaintiff

represents in the derivative claims.

CONCLUSION

For the foregoing reasons, the Court should grant Plaintiff's application for a temporary

restraining order and enter a preliminary injunction in order to protect the Plaintiff’s rights

pending a hearing on the merits. Plaintiff is likely to prevail on the merits and will suffer

irreparable harm without preliminary relief.

Dated: New York, New York November 13, 2014

Respectfully submitted,

DROHAN LEE LLPCounsel for Plaintiff

489 Fifth Avenue New York, New York 10017

By: //Vivian Rivera Drohan//Vivian Rivera Drohan

Oca Memorandum Boston Technologies

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