Brief Fact Summary. Irvin Rauchman, (Petitioner), brought suit against Mobil Corporation, (Respondent), to compel Respondent to include his proposal to amend the bylaws in the corporation’s proxy statement. Petitioner appeals the District Court grant of Respondent’s motion for summary judgment.
Synopsis of Rule of Law. A proposal that calls into question the qualification of a board member for reelection is an effort to oppose management’s solicitation on behalf of the reelection process and may be excluded from the corporation’s proxy statement.
Section 27 of the Act specifically grants the appropriate district courts jurisdiction over all suits in equity and actions at law brought to enforce any liability or duty created under the Act.View Full Point of Law
Issue. Whether Mobil properly excluded a proposal from its proxy statement that would amend Mobil’s bylaws to prevent a citizen of an OPEC country from sitting on Mobil’s board of directors. .
Held. Yes. Mobil properly excluded the proposal from its proxy statement because the proposal is an effort to oppose management’s solicitation on behalf of the reelection process.
Discussion. The election of Olayan to the board would have been forbidden by the proposed bylaw amendment since the amendment would have made him ineligible to sit on the board. The proposed comment unmistakably refers to Olayan. A Mobil stockholder could not vote for Petitioner’s proposal and at the same time ratify the nomination of Mr. Olayan. Therefore the proposal could be viewed as an effort to oppose management’s solicitation on behalf of Olayan’s reelection.