Greenlight's David Einhorn reasserts case against Apple ahead of hearing
David Einhorn, whose Greenlight Capital is suing Apple to block a proposal that would hinder the company's power to issue preferred stock, filed a response to the U.S. District Court in Manhattan on Friday, saying that the company's "pro-shareholder" amendment is anything but.
The restatement of Einhorn's original argument comes after Apple filed its own response on Wednesday, which claimed the lawsuit is holding shareholders "hostage" in an attempt to force the company into making a decision that would only benefit the hedge fund chief.
Einhorn disagrees with Apple's view and, as noted by Reuters, offered some strong words in support of his lawsuit.
"First, I believe it it is up to the shareholders, not Apple, to determine whether a proposed amendment is 'pro-shareholder' and to do so by voting on the amendment separate from other items," Einhorn said in Friday's filing. "In this suit, the Greenlight Entities are seeking vindication of the rights of all Apple shareholders to vote their views on that issue, separate from other matters that I support."
Earlier in the response, Einhorn noted that one of his responsibilities as the portfolio manager of the Greenlight Entities is to conduct extensive research and analysis of Apple, which is one of his major investments.
The lawsuit takes issue with Apple's so-called "Prop 2" proxy proposal which will be voted on at the company's upcoming shareholders' meeting scheduled for the end of February. If passed, Prop 2 would remove the power to issue preferred stock from Apple's board and put it in the hands of shareholders.
Greenlight's Einhorn is seeking for the issuance of perpetual preferred shares, dubbed "Greenlight Opportunistic Use of Preferreds" or "GO-UPs," which would in theory allow Apple to mete out some of its $137 billion cash hoard with shares that pay out higher than normal dividends. Apple claimed on Wednesday that the GO-UPs only serve Greenlight's financial interests and "do not serve the public interest."
The court is set to hear the case on Feb. 19, just over one week before the scheduled Feb. 27 Apple shareholder meeting.
39 Comments
Dork.
Looking back over the past few years, it's amazing how a company that just wants to make great products and improve mankind's ability to do things can cop so much flak...from mankind itself.
The world legal systems really need to remove the monetary component from the process and substitute it with righting said "wronged situations" instead.
This flaw is generating too much greed in the weak-willed people.
And here's what I think of Einhorn...
Cite: [URL=https://en.wikipedia.org/wiki/David_Einhorn_(hedge_fund_manager)]https://en.wikipedia.org/wiki/David_Einhorn_(hedge_fund_manager)[/URL] [QUOTE] [SIZE=4][B]Microsoft[/B][/SIZE] On May 26, 2011, Einhorn called for Steve Ballmer, CEO of Microsoft, to step down after Microsoft had been passed by both IBM and Apple[20] in market value.[21] [SIZE=4][B]Green Mountain Coffee Roasters[/B][/SIZE] Speaking at the Value Investing Congress in New York City on October 17, 2011, Einhorn publicly announced his short position in Green Mountain Coffee Roasters stock.[22] Prior to that date, the company's share price had increased more than tenfold since March of 2009, the third-biggest gain in the Standard & Poor's Midcap 400 Index. In his presentation Einhorn opined that the market for Green Mountain's new Keurig single-cup coffee brewer was "limited," and that the K-Cup coffee pods for the machine presented a "looming patent issue" for the company. He also said that Green Mountain had a "litany of accounting questions." Following Einhorn's speech Green Mountain's share price fell by 10 percent, closing that day at $82.50.[23] A few weeks later on November 9, 2011, Green Mountain's quarterly report missed analyst expectations and its stock price plunged to $43.71. The company's CEO Lawrence J. Blanford cited a "number of factors including changes in wholesale customer ordering patterns in our grocery and club channels" for the underperformance of the company. [SIZE=4][B]U.K. Insider Dealing[/B][/SIZE] [B]In January 2012, the U.K. Financial Services Authority (FSA) fined Einhorn and Greenlight Capital $11.2 million for allegedly trading on inside information.[/B] The FSA claimed Einhorn obtained information on the Punch Taverns Plc (PUB) equity fundraising by a broker representing the company prior to public knowledge of the event. Within minutes of receiving the information, Einhorn sold more than 11 million shares over the following four days, avoiding a 29.9% stock price collapse and subsequent loss of about ?5.8 million. [24] The FSA stated: "The FSA accepted that Einhorn’s trading was not deliberate because he did not believe that it was inside information. However, this was not a reasonable belief.[24] " "This was a serious case of market abuse by Einhorn and fell below the standards the FSA expects, particularly due to Einhorn’s prominent position as President of Greenlight and given his experience in the market.[24]" “Einhorn is an experienced professional with a high profile in the industry. We expect someone in his position to be able to identify inside information when he receives it and to act appropriately. His failure to do so is a serious breach of the expected standards of market conduct. It is highly damaging to market confidence when privileged shareholders commit market abuse, and the high penalty reflects the seriousness of his breach.”[24] Einhorn called the £7.2m fine "unjust" and "inconsistent with the law" but said he would pay it "rather than continue an arduous fight" [25] The fine was the second largest levied on an individual in the history of Britain’s Financial Services Authority. [26] [/QUOTE] Throw him and his crew in federal prison.
"First, I believe it it is up to the shareholders, not Apple, to determine whether a proposed amendment is 'pro-shareholder' and to do so by voting on the amendment separate from other items," Einhorn said in Friday's filing. "In this suit, the Greenlight Entities are seeking vindication of the rights of all Apple shareholders to vote their views on that issue, separate from other matters that I support."
No it's not, so go f**k yourself you greedy little pr!ck.
Guy's a full-blown short-seller, got burned for making bad calls on those "investments", now is trying cut his losses by squeezing more from Apple.
As an AAPL owner, I would tell the guy if he doesn't like the way Apple is running shop, sell your shares and go away.
No it's not, so go f**k yourself you greedy little pr!ck.
Guy's a full-blown short-seller, got burned for making bad calls on those "investments", now is trying cut his losses by squeezing more from Apple.
As an AAPL owner, I would tell the guy if he doesn't like the way Apple is running shop, sell your shares and go away.
He does appear to give bottom-feeding trash fish a bad name.