Sullivan & Cromwell Discusses How Companies Should Prepare for Potential Proxy Disclosure Litigation

Plaintiffs’ attorneys have continued to bring, or threaten, litigation against U.S. companies following the filing of their annual proxy statements. These complaints generally allege disclosure deficiencies in connection with the approval of equity compensation plans and/or the advisory shareholder “say-on-pay” vote and, as with merger-related “strike suits,” seek to enjoin the annual meeting. Early cases gained some traction, resulting in settlements yielding additional proxy disclosures and legal fees for the  plaintiffs, though most companies have resisted settling. While some companies have taken the  heightened litigation risk into account in crafting 2013 proxy disclosure, it seems likely that no level of  … Read more

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Editor's Tweet: Sullivan & Cromwell Discusses How Companies Should Prepare for Potential Proxy Disclosure Litigation