- Bloomberg-20 minutes agoGreenlight Capital Inc. won an order blocking Apple Inc. (AAPL) from moving forward with a shareholder vote on provisions that include a ...
Apple Shareholder Vote Blocked at Greenlight’s RequestBy Christie Smythe & Patricia Hurtado - Feb 22, 2013 12:55 PM PTDavid Einhorn's Greenlight Capital Inc. won an order blocking Apple Inc. from moving forward with a shareholder vote on provisions that include a measure limiting the company’s ability to issue preferred stock.
U.S. District Judge Richard Sullivan in Manhattan today granted Greenlight’s request for an injunction blocking the vote on the grounds that Apple had unfairly bundled three proposals, including the preferred shareholder measure it opposes with others it supports, under an item named “Proposal No. 2.”
Greenlight showed it would be irreparably harmed by the vote and that it will likely prevail in its suit alleging that the bundling of the items is illegal, Sullivan said in his ruling.
If the disputed measure passes, Greenlight “will be hampered with an amendment to the articles they oppose and which Apple presented illegally,” Sullivan wrote.
Greenlight, which says it holds more than 1.3 million Apple shares, sued alleging that the company’s grouping of the provisions violates U.S. Securities and Exchange Commission rules. The New York-based hedge fund firm and Einhorn, its founder, have urged Apple to issue high-yielding preferred stock in order to help shift the value of a $137 billion stockpile of cash to investors.
The measure up for vote at a Feb. 27 meeting would “eliminate” the Apple board’s power to issue preferred stock, Greenlight alleged in its complaint. Apple disputed that contention and said the move would only prevent the company from offering the stock without consent of other investors.
Apple, based in Cupertino, California, has also said it doesn’t believe it is breaking the law by grouping the matters up for vote.
Apple spokesman Steve Dowling didn’t immediately return a call seeking comment. Jonathan Doorley, a spokesman for Greenlight, said he didn’t have an immediate comment.
The case is Greenlight Capital LP v. Apple Inc. (AAPL), 13-cv- 00900, U.S. District Court, Southern District of New York (Manhattan).
To contact the reporter on this story: Christie Smythe in Brooklyn at email@example.com
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