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Apple blasts shareholder lawsuit in court response
Just a few days after Apple CEO Tim Cook referred to a shareholder lawsuit spearheaded by Greenlight Capital fund manager David Einhorn as a "silly sideshow," the company filed its formal response to the lawsuit. As one would expect, the response is rather harsh. As noted in MacNN's analysis of the response, Apple found that Einhorn's plan was "self-serving," with even Einhorn himself referring to the proposal as a "roadblock." In previous coverage of this lawsuit, we noted that it was brought on by a desire by shareholders to have Apple distribute more of its sizable cash hoard through dividends. Einhorn had made a proposal asking for the issuance of "perpetual" preferred shares of AAPL that would pay a larger dividend than common stock. Apple has a proposal coming up for vote at its general meeting on February 27 to prevent any distribution of preferred shares without the approval of shareholders, and Einhorn's not happy with that. In Apple's response, the company notes that Einhorn's plan -- which calls for the preferred shares to be called "Greenlight Opportunistic Use of Preferreds" or GO-UPs -- has little benefit to anyone except Greenlight Capital. To paraphrase the title of a book by Einhorn, he appears to be trying to "fool some of the people all of the time" with his proposal. Apple CFO Peter Oppenheimer declared to the court that Einhorn referred to his lawsuit as a "roadblock" in a conversation between the two, and the company calls for the lawsuit to be dismissed for any one of four reasons listed in the response. First hearings on the lawsuit are scheduled for February 19, and Greenlight must file its response to Apple's claims by this Friday.
Tim Cook: Shareholder lawsuit is a 'silly sideshow'
You may recall a TUAW post last week about a shareholder lawsuit spearheaded by Greenlight Capital fund manager David Einhorn. The lawsuit essentially claims that Apple isn't doing enough to make sure that shareholders are receiving the benefits of the company's success, and contests a proposition to add a requirement to Apple's charter forcing any move to issue preferred stock to be approved by common shareholders. Apple CEO Tim Cook, speaking at a Goldman Sachs investor conference today, referred to the lawsuit as a "silly sideshow." According to our sister site TechCrunch, Cook commented during the conference that the approval process by common shareholders was part of a 2012 look at how Apple could improve its governance. According to Cook, "I find it bizarre that we would find ourselves being sued for something that's good for consumers." Cook's personal preference? To have both sides take any money that would be wasted in fighting a lawsuit and donate it to a worthy cause. Cook thinks that the lawsuit is "a waste of shareholder money, and it's a distraction, and it's not a seminal issue for Apple." Regardless of whether the proposition makes it into the Apple corporate charter, Cook said that the company will insist on a vote from common shareholders before any preferred stock is issued.
Daily Update for February 12, 2013
It's the TUAW Daily Update, your source for Apple news in a convenient audio format. You'll get all the top Apple stories of the day in three to five minutes for a quick review of what's happening in the Apple world. You can listen to today's Apple stories by clicking the inline player (requires Flash) or the non-Flash link below. To subscribe to the podcast for daily listening through iTunes, click here. No Flash? Click here to listen. Subscribe via RSS
