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Majority Voting
The labor union-driven movement to require that directors be elected by a majority vote rather than a mere plurality has gained traction with remarkable speed. As highlighted by Neal, Gerber & Eisenberg LLP's company-by-company Study of Majority Voting in Director Elections (available at www.ngelaw.com), majority voting has become a marquee issue for the 2006 proxy season that creates the specter of unintended consequences, such as triggering change of control clauses in credit agreements. While a powerful force by itself, majority voting is a component of a group of governance 'reforms' that signal a shift in the balance of power between boards and stockholders.
Until recently, virtually all directors of U.S. corporations were elected under a 'plurality' standard, meaning that the nominees with the largest number of votes were elected, up to the number of directors to be chosen at the election, without regard to votes 'withheld' or 'against' (even if they constitute a majority of the votes cast). Accordingly, many stockholder activists consider director elections largely symbolic and an ineffective mechanism for creating accountability in the boardroom. A stockholder who believes in a business, but who is uncomfortable with the board and its decisions on issues such as executive compensation is left with a simple choice ' sell or stay put.
The SEC's 2003 proxy access initiative, which was intended to provide large, long-term security holders direct access to a company's proxy statement for purposes of nominating a limited number of director candidates, could have addressed some of these concerns. However, the initiative was roundly criticized by much of corporate America, and became mired in politics. Frustrated activists, led by the United Brotherhood of Carpenters and Joiners of America (UBCJA), began exploring a majority voting standard (and related changes in state corporate laws) as an alternative mechanism to make votes cast against a nominee meaningful.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Removing Restrictive Covenants In New York
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.