Tuesday, February 3, 2009
Like Lovenheim, Austin is a case in which a corporation refused to distribute a shareholder proposal in advance of an annual shareholder meeting. Consolidated Edison's labor union proposed new rules that would provide employees with more generous pension benefits. In this case, the basis for management's refusal to distribute the proposal was its claim that the proposal was excludable under SEC Rule 14a-8(i)(7) because it related to ordinary business operations. The court stated that the proposal, while audacious, was still mundane and thus was best addressed through the collective bargaining process rather than through a shareholder vote.
Austin v. Consolidated Edison Co.
Finding the audacious mundane,
The court would not entertain
Relating to pensions,
And dismissed the suit as inane.