The Delaware Court of Chancery issued an opinion upholding stockholder voting rights. The court granted a motion to expedite a claim by an activist stockholder that the target company's board of directors breached its fiduciary duties by not waiving an advance notice provision for director nominations contained in the target company's by-laws. The advance notice provision required stockholders to submit director nominations at least 120 days prior to the first anniversary of the preceding year's annual meeting, unless the meeting date is delayed or advanced by more than 30 days from the anniversary.
Following the advance notice deadline, the activist stockholder sought to nominate director candidates upon learning of the target company's summary rejection of an unsolicited takeover bid. The court found that the activist stockholders had successfully made a "sufficiently colorable claim" of irreparable injury due to the target company having summarily rejected the takeover bid. The failure to consider the takeover bid violated one of the key elements of the target company's investment thesis requiring faithful consideration to be given to a transaction which presented a compelling value.
Icahn Partners LP v. Amylin Pharmaceuticals, Inc., C.A. No. 7404-VCN (Del. Ch. Apr. 20, 2012).