Publications

Vote Buying Raises Questions Under Anti-Fraud Rules

Fall 2005
Marc Weingarten
Activist Investing Developments - Fall 2005

Various significant corporate actions, including mergers, substantial stock issuances and liquidations, as well as the election of directors, require a shareholder vote. Activist investors, who may, in fact, be the catalysts for the matters coming before the shareholders for a vote, obviously have a significant stake in the outcome. The nature and complexity of their holdings in the subject company, including through the use of derivatives, may raise questions about whether they are really "shareholders" entitled to vote. Some of these questions are quite novel, with no clear answers under current law.