No-Action Letter Tracking Update 2/10/14
March 14, 2014
A recent stampede of DEF-14As signals the start of annual meeting season and the end of shareholder proposal wrangling. But, before the 2013-2014 proxy season heads for the last round-up the team behind the new Business Law Center on WestlawNext presents this fourth in a series of posts examining the ragged edge of shareholder proposal-land: no-action letter requests to the SEC.
See more at: http://blog.legalsolutions.thomsonreuters.com/large-law/action-letter-requests-sec/#sthash.svzQYVd9.dpuf
No-Action Letter Tracker: February 10, 2014:
2013-2014 Season (as of 2/10/14) | 2012-2013 Season (as of 2/10/13) | 2011-2012 Season (as of 2/10/12) | |||
1. Registrants Submitting the Most No-Action Requests | |||||
Dominion Resources | 10 | General Electric | 11 | General Electric | 10 |
JPMorgan Chase | 10 | Dominion Resources | 8 | ExxonMobil | 8 |
Verizon | 9 | First Energy / Verizon | 7 | AT&T / Deere / JPMorgan | 6 |
General Electric | 8 | AT&T / B of A / Comcast | 6 | ||
2. Proponents Most Frequently Cited in No-Action Letters | |||||
J. Chevedden & collaborators | 87 | J. Chevedden & collaborators | 61 | J Chevedden | 40 |
Qube Inv. Mgmt | 19 | Unified Bro. of Carpenters | 12 | W & K Steiner | 26 |
National Ctr. for Public Policy Research | 10 | AFL-CIO | 9 | United Bro. Carpenters | 14 |
Investor Voice | 9 | AFSCME / NY Retirement | 9 | NYS Ret. / NYC Ret. / AFL-CIO | 10 |
3. Number of Letters by Proponent Type | |||||
Individuals | 143 | Individuals | 134 | Individuals | 142 |
Activist Funds | 48 | Labor & Pension Funds | 75 | Labor & Pension Funds | 72 |
Labor & Pension Funds | 34 | Activist Funds | 27 | Activist Funds | 30 |
Public Policy Orgs | 21 | Religious Organizations | 23 | Religious Organizations | 19 |
4. Most Common Proposal Subjects | |||||
Executive Compensation | 41 | Executive Compensation | 60 | Environmental Matters | 35 |
Environmental Matters | 31 | Environmental Matters | 41 | Executive Compensation | 34 |
Independent Board Chair | 22 | Political Contributions | 31 | Political Contributions | 31 |
Political Contributions | 20 | Independent Chair | 23 | Special Meeting Power | 26 |
5. Totals | |||||
No-Action Requests | 266 | No-Action Requests | 282 | No-Action Requests | 283 |
Number of Registrants | 149 | Number of Registrants | 160 | Number of Registrants | 185 |
Number of Proponents | 104 | Number of Proponents | 132 | Number of Proponents | 117 |
Resolved Letters
149 letters resolved: 37 withdrawn, 112 received an SEC ruling.
Ruling breakdown:
SEC concurred with registrant (proposal is OUT): 78 – 70%
SEC was unable to concur with registrant (proposal is IN): 34 – 30%
Most-cited grounds for excluding proposals:
Proponent failed to prove share ownership: 24 – 21%
Proposal applies to ordinary business operations: 14 – 13%
Proposal is vague or misleading: 9 – 8%
Proposal conflicts with a management proposal: 8 – 7%
Guest No-Action Letter Analysis from Practical Law
This month we’re delighted to supplement our no-action letter tracker with the following related material from Practical Law:
- An analysis of the recent decision of the US District Court for the Eastern District of Missouri in Express Scripts v. Chevedden, excluding a stockholder proposal on the basis of material misstatements, and
- Rule 14a-8 Shareholder Proposal Process Flowchartprepared by Jeffrey L. Kochian, Jeffrey B. Werbitt and William K. Wetmore of Akin Gump Strauss Hauer & Feld LLP.
For more information about Practical Law or to access additional resources, sign up for a free trial.