Delaware Rules For CA In Proxy Payment Case

Law360, New York (July 18, 2008, 12:00 AM EDT) -- The Delaware Supreme Court struck down a proposal that would force companies to reimburse shareholders for the costs of even partially successful short-slate proxy contests Thursday.

The court ruled that a shareholder bylaw proposed by the American Federation of State, County and Municipal Employees that called for CA Inc. to pay the expenses of shareholders who place one or more candidates onto the company's board violates Delaware law because forcing the board to pay limits the board's ability to carry out its fiduciary responsibilities.

“That this...
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