Friday, July 22, 2011

"SEC's controversial proxy access rule tossed out by court"

From the Times of El Pueblo de la Reina de Los Angeles:
A federal appeals court on Friday invalidated a  controversial Securities and Exchange Commission rule to make it easier for shareholders to force out company directors.

The rule allowed large shareholders to have their board nominees listed on company-mailed proxy ballots along with the management's preferred candidates instead of being forced to spend the money to send out separate ballots.

The rule was supported by public pension funds, labor unions, shareholder advocates and some investment managers as a way to help shareholders force changes at under-performing companies and curb high executive compensation.

But many large companies opposed the rule. They argued it would open the door for hedge funds and corporate raiders to manipulate companies and would give too much power to special interest groups, such as labor unions....MORE