Brief Fact Summary. Richard Gittlin, (Petitioner), appeals the District Court ruling in favor of Studebaker Corporation, (Respondent), enjoining the use of other stockholders’ authorizations in a New York State Court proceeding to obtain inspection of Studebaker’s shareholders list.
Synopsis of Rule of Law. A letter which does not request the giving of any authorization was subject to the Proxy Rules if it was part of “a continuous plan” intended to end in solicitation and to prepare the way for success.
Issue. Whether Petitioner’s demand for inspection of the stockholders list and his solicitation of authorizations were part of a continuous plan intended to end in solicitation and to prepare the way for success.
Held. Yes. This was Petitioner’s declared purpose.
Discussion. The copy of a stockholders list is a valuable instrument to a person seeking to gain control and therefore shareholders must have full information before they aid in its procurement. Presumably the stockholders who gave authorizations were told something and one need only spread misinformation adequately before beginning to solicit and the Commission would be powerless to protect shareholders.