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CALIFORNIA CORPORATE & SECURITIES LAW

The SEC’s Rule 14a-8 Process Just Became Even More Pointlessly Outré

Yesterday, Broc Romanek posted on SEC Chair Mary Jo White’s Friday surprise with respect the no-action letter request submitted by Whole Foods Market, Inc.  Readers may recall that in December Whole Foods had obtained the staff’s concurrence in excluding a shareholder access proposal submitted by Jim McRitchie. The basis for Whole Foods’ exclusion was that it intended…

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This “Appeal” Of Whole Foods’ No-Action Letter Isn’t Very Appealing

Last week, James McRitchie submitted an “appeal” of the staff’s grant of no-action advice to Whole Foods Market, Inc.  As explained in this post by Broc Romanek, Whole Foods was able to obtain that staff’s concurrence in excluding Mr. McRitchie’s proposal in favor of its own. I’ve typed “appeal” in quotes because there really is…

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The Shareholder Rights Project: Advice And Representation

Professor (and former SEC Commissioner) Joseph A. Grundfest and incumbent SEC Commissioner Daniel M. Gallagher have certainly fomented a spirited donnybrook over the Shareholder Rights Project at Harvard.  As discussed in this post,  they recently released a paper concluding, among other things, that the SRP’s “failure accurately to describe the current state of the academic literature can be characterized as…

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In Texas Can Some Shares Be More Equal Than Others?

Although Rome before Augustus is often described as a republic, it was in many respects ruled by the wealthy who jealously guarded their power.  So it was with Rome’s comitia centuriata.  In theory, this was an assembly of the people that elected the chief officials of the republic.  However, these were not direct elections.  Instead, the populace was divided into groups, known as centuries, and…

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Commissioner Gallagher Posits SEC Would Prevail Against Harvard University

Just this week, Commissioner Daniel M. Gallagher and former Commissioner Joseph A. Grundfest issued a draft of a paper that takes on the Harvard Shareholder Rights Project.  The Harvard SRP describes itself as “a clinical program operating at Harvard Law School and directed by Professor Lucian Bebchuk.”  From 2012 through 2014, the Harvard SRP focused on proposing…

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Should Judicial Deference To The SEC Be Strong, Weak or Non-Existent?

This post yesterday by Broc Romanek alerted me to Judge Leonard P. Stark’s recent opinion in Trinity Wall Street v. Wal-Mart Stores, Inc., 2014 U.S. Dist. LEXIS 165431 (D. Del. Nov. 26, 2014).  The case involved Wal-Mart’s decision to exclude a shareholder proposal from its 2014 proxy statement after receiving favorable no-action advice from the staff of…

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Investor Voice May Rue Adoption Of Single Voting Standard

In yesterday’s post, I discussed why the Council of Institutional Investor’s blanket policy eschewing the counting of abstentions may be neither good nor legal.  CII, however, isn’t the only proponent of not counting abstentions.  As Broc Romanek reported in his Proxy Season Blog, a Seattle based group by the name of Investor Voice SPC is submitting shareholder…

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Is A Popularity Contest The Best Way To Pick A Proxy Advisor?

Koheleth wrote that “there is nothing new under the sun”, but there are a many ideas that are new to me.  Such is the case with the shareholder proposal recently submitted by James McRitchie (Corpgov.net) to Cisco Systems, Inc.  In general, he proposes that Cisco’s board establish a competition for proxy advisory firms.  These firms would pay a fee (he…

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Who Opens And Closes The Polls?

One of the seemingly routine matters at stockholder meetings is the opening and closing of the polls.  Sometimes, votes are close and the outcome of a vote may turn on whether the polls are closed “early” or “late”.  For a real-life example, see In re Carver Bancorp, Inc., 2000 Del. Ch. LEXIS 12 (Aug. 28, 2000) (Shares…

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Are Proxy Access Bylaws Legal?

Proxy Access Meets Private Ordering Despite the invalidation of the Securities and Exchange Commission’s proxy access rule last summer, many companies are considering, or are being forced to consider, adoption of proxy access bylaws.  This is what many academics are wont to call “private ordering”. I’ve seen a number of recommendations concerning proxy access bylaws –…

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