"When confronted with uncertain state law, a federal court, sitting in diversity jurisdiction, must predict what course the highest court in the state would take." Byelick v. Vivadelli, 79 F. Supp.2d 610, 623 (E.D. Va. 1999). The court can base this prediction on "canons of construction . . . recent pronouncements of general rules or policies by the state's highest court, well considered dicta, and the state's trial court decisions."

"The district court also `must view the evidence presented through the prism of the substantive evidentiary burden.'" Byelick v. Vivadelli, 79 F. Supp.2d 610, 616 (E.D. Va. 1999) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-52 (1986)) (in the context of motion for summary judgment) B. The Constructive Fraud Verdict

Directors and officers of Virginia corporations owe fiduciary duties to their corporation and to the corporation's shareholders. Byelick v. Vivadelli, 79 F.Supp.2d 610, 623 (E.D. Va. 1999); A.I.M. Percolating Corp. v. Ferrodine Chem. Corp., 124 S.E. 442, 445 (Va. 1924). The law considers directors and officers to have a “quasi trust” relation with the corporation and the stockholders as a class, meaning that they “must act in the utmost good faith, and this good faith forbids placing himself in a position where his individual interest clashes with his duty to his corporation.” Rowland v. Kable, 6 S.E.2d 633, 642-43 (Va. 1940).

DCG & T ex rel. Battaglia/Ira v. Knight actually cuts against the defendants' argument because the court in that case noted that the Virginia statute in question "refers to a corporation's (and not a shareholder's) right to void an interested director transaction." 68 F.Supp.3d 579, 589 (E.D. Va. 2014) (quoting Byelick v. Vivadelli , 79 F.Supp.2d 610, 628 (E.D. Va. 1999) ). As such, the court held that the statute only applied in derivative suits, not shareholder class actions such as the case at hand.

When confronted with uncertain state law, a federal court sitting in diversity jurisdiction must predict what course the highest court in the state would take. Byelick v. Vivadelli, 79 F.Supp.2d 610, 623 (E.D.Va.1999). The federal court may base its prediction on "canons of construction, restatements of the law, treatises, recent pronouncements of general rules or policies by the state's highest court, well considered dicta, and the state's trial court decisions."

The law of Virginia is clear that corporate directors have a fiduciary duty to the corporation and to its shareholders, and they must govern themselves accordingly. Va. Code § 13.1-690;Byelick v. Vivadelli, 79 F.Supp.2d 610, 623 (E.D. Va. 1999) ("It is well settled that `[a] Virginia corporation's directors and officers owe a duty of loyalty both to the corporation and to the corporation's shareholders.'") (quoting, WLR Foods v. Tyson Foods, Inc., 869 F.Supp. 419, 421 (W.D. Va. 1994)); Glass v. Glass, 228 Va. 39, 47, 321 S.E.2d 69, 74 (1984) ("Corporate officers and directors have a fiduciary duty in their dealings with shareholders and must exercise good faith in such dealings.").

The law of Virginia is clear that corporate directors have a fiduciary duty to the corporation and to its shareholders, and they must govern themselves accordingly. Va. Code § 13.1-690;Byelick v. Vivadelli, 79 F.Supp.2d 610, 623 (E.D. Va. 1999) ("It is well settled that `[a] Virginia corporation's directors and officers owe a duty of loyalty both to the corporation and to the corporation's shareholders.'") (quoting, WLR Foods v. Tyson Foods, Inc., 869 F.Supp. 419, 421 (W.D. Va. 1994)); Glass v. Glass, 228 Va. 39, 47, 321 S.E.2d 69, 74 (1984) ("Corporate officers and directors have a fiduciary duty in their dealings with shareholders and must exercise good faith in such dealings.").