Will Einhorn Get His Way Against Apple?
The judge presiding over the case between David Einhorn’s Greenlight Capital and Apple (NASDAQ:AAPL) said he saw a “likelihood of success” for the hedge fund, but added he needed more time to come to a conclusion.
“Candidly I do think the likelihood of success is in favor for Greenlight,” U.S. District Judge Richard Sullivan said in New York. The judge said his focus was on determining whether Greenlight would be irreparably harmed, as Einhorn has argued, if the vote on the proposal in Apple’s proxy went ahead.
Greenlight Capital filed the lawsuit in an attempt to stop shareholder vote on an Apple proposal to eliminate preferred stock without investor approval. The voting is set for February 27, when the company’s shareholders get together for their annual meeting.
Sullivan also questioned Apple’s argument that the three proposals being put to vote as a single package actually qualified as a “single amendment.”
Einhorn’s Greenlight has said they don’t, and hence violate U.S. Securities and Exchange Commission laws. “If you’re a shareholder of Apple, you have to vote yes to all as a group or no to all as a group,” the fund’s lawyer Mitchell P. Hurley said on Tuesday. “The federal securities laws flatly prohibit Apple from putting its shareholders in that position.”
However, Sullivan agreed with Apple that delaying the vote would incur millions of dollars in administrative costs…