Advance Notice By-Laws – A Canadian Shield

In BlackRock Credit Allocation Income Trust v. Saba Capital Master Fund, Ltd., the Delaware Supreme Court recently provided guidance on the validity of supplemental disclosure obligations imposed on shareholders seeking to nominate potential directors in accordance with an issuer's advance notice by-laws. The Court held that two publicly traded, closed-end fund trusts advised by BlackRock Advisors, LLC, were not required to recognize individuals nominated for election by a dissident shareholder due to the shareholder's non-compliance with the trusts' advance notice by-laws (the "By-laws"). The shareholder submitted its nominations on time but failed to respond or object to the trusts' requests for additional information about the nominees within the five-day period imposed by the By-laws. The Court held that this failure invalidated the nominations based on the clearly stated response deadline in the By-laws notwithstanding the overly broad nature of many of