Apple blasts shareholder lawsuit in court response
Just a few days after Apple CEO Tim Cook referred to a shareholder lawsuit spearheaded by Greenlight Capital fund manager David Einhorn as a "silly sideshow," the company filed its formal response to the lawsuit.
As one would expect, the response is rather harsh. As noted in MacNN's analysis of the response, Apple found that Einhorn's plan was "self-serving," with even Einhorn himself referring to the proposal as a "roadblock."
In previous coverage of this lawsuit, we noted that it was brought on by a desire by shareholders to have Apple distribute more of its sizable cash hoard through dividends. Einhorn had made a proposal asking for the issuance of "perpetual" preferred shares of AAPL that would pay a larger dividend than common stock. Apple has a proposal coming up for vote at its general meeting on February 27 to prevent any distribution of preferred shares without the approval of shareholders, and Einhorn's not happy with that.
In Apple's response, the company notes that Einhorn's plan -- which calls for the preferred shares to be called "Greenlight Opportunistic Use of Preferreds" or GO-UPs -- has little benefit to anyone except Greenlight Capital. To paraphrase the title of a book by Einhorn, he appears to be trying to "fool some of the people all of the time" with his proposal.
Apple CFO Peter Oppenheimer declared to the court that Einhorn referred to his lawsuit as a "roadblock" in a conversation between the two, and the company calls for the lawsuit to be dismissed for any one of four reasons listed in the response. First hearings on the lawsuit are scheduled for February 19, and Greenlight must file its response to Apple's claims by this Friday.
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