Apple - Einhorn Dispute Shines Spotlight On SEC’s Unbundling Rules

Although the dispute between hedge fund manager David Einhorn and Apple, Inc. is about Apple's capital allocation strategy, it has brought attention to the SEC rules on "unbundling" of proxy statement proposals.  On Friday, the U.S. District Court for the Southern District of New York enjoined Apple from holding a shareholder vote at its February 27 annual meeting on a proposal (Proposal No. 2) to amend its articles of incorporation to "[(i)] eliminate certain language relating to the term of office of directors in order to facilitate the adoption of majority voting for the election of directors; [(ii)] eliminate 'blank check' preferred stock; [(iii)] establish a par value for the Company's common stock of $0.00001 per share; and [(iv)] make other conforming changes . . ., including eliminating provisions in the Articles relating to preferred stock of the Company."