In the first week of February, Greenlight Capital hedge fund analyst David Einhorn filed a lawsuit against Apple over a preferred stock option, which would give back some of the company’s huge cash pile to investors.
The next day, Apple issued an official press release saying that the company is exploring cash return options and would be taking Greenlight’s proposal into consideration. Last week, Apple pulled a proposal from its charter that would have allowed shareholders to eliminate preferred stock. Today, Greenlight dropped the lawsuit.
Greenlight Capital owns $585 million in Apple stock and Einhorn alone holds 1.3 million shares, so what the company does with its money is important to the investor.
When a New York federal judge blocked Apple from voting on the preferred stock because the iPad maker had bundled the proposal into another un-related proposal regarding staggered voting for directors. Judge Richard Sullivan claimed that this type of action is a violation of the Securities and Exchange Commission’s “unbundling rules,” [Via: Forbes]
Apple pulled the “blank check” preferred stock proposal from the voting proxy, which was enough to satisfy Greenlight. A spokesperson for the investment firm told AllThingsD that the suit had served its purpose. “Apple removed the bundled proposal from the shareholder meeting, therefore resolving the issue.” The end.