A Manhattan federal court judge said he likes hedge-fund honcho David Einhorn’s odds of winning a lawsuit against Apple over a governance proposal — but he stopped short of saying he will block shareholders from voting on the proposed change.
“I do think the likelihood of success is in favor of Greenlight,” Judge Richard Sullivan said at a hearing yesterday, speaking of the merits of the entire case.
Sullivan said he would rule before the Feb. 27 vote.
The judge said he will decide the narrower issue of blocking the vote, in part, on whether or not Einhorn’s Greenlight Capital hedge fund would be irreparably harmed if the vote at Apple’s annual shareholder meeting were to take place.
Earlier this month, Einhorn sued Apple for “bundling” three shareholder proposals.
His concern is that the bundling could affect the outcome of a proposal to require shareholder approval for Apple to issue preferred shares.
Einhorn has been pestering Apple to spend some of its $137 billion cash horde on investors by issuing tax-favorable preferred stock that carries a 4 percent dividend.
Apple rejected the proposal last year, but has since said it will consider Einhorn’s request.
While investors say they tend to dislike when companies bundle proposals, heavy-hitters like the $245 billion California Employees Public Retirement System have said they support Apple’s move to require shareholders’ OK to issue elite preferred shares.