Monday, May 17, 2004
On May 13, 2004, in Mony Group, Inc. v. Highfields Capital Management, L.P., the Second Circuit reversed the denial of a preliminary injunction in a case involvoing a proxy fight. The issue in the case was whether a duplicate copy of a proxy card that had been sent by MONY to its shareholders was a "form of revocation," which would require the defendants to comply with all proxy rules. A solicitation by a person who does not seek the power to act as proxy and which does not contain a form of revocation of a prior proxy is not subject to the SEC proxy regulations. MONY sought to enjoin the defendants, who were opposing a merger proposal favored by MONY's management, from including the duplicate card in their solicitations to shareholders. The District Court denied the motion, concluding that MONY was unlikely to succeed on the merits. The Second Circuit reversed holding that, under the circumstances of the case, the duplicate proxy form was a form of revocation under the SEC rules. The Court also held that MONY would be irreparably harmed if the solicitation went out without satisfying the disclosure regulations promulgated by the SEC. The decision can be found here.