Apple Defends Proxy in Legal Filing

Wednesday, 13 Feb 2013 | 7:39 PM ET
Tim Cook, CEO of Apple Inc.
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Tim Cook, CEO of Apple Inc.

Apple defended its proxy in a legal filing against David Einhorn's lawsuit on Wednesday, stating in the filing that the lawsuit was a way for Einhorn to "induce" Apple to adopt a new type of preferred stock.

Einhorn, fund manager for Greenlight Capital, accused Apple of cash hoarding last week and is suing Apple because he claims proposition two of the proxy will kill the issuance of preferred stock.

(Read More: Einhorn Fires Back at Apple's Tim Cook )

Apple, though, said in its filing that it would still be able to issue preferred stock as long as it had shareholder approval. The company also said in its filing that proxy advisory firm ISS—the largest proxy firm in the world—recommended proposition two.

Back and forth between Apple and Einhorn has been ongoing over the last two weeks. Tuesday, Apple CEO Tim Cook called Einhorn's lawsuit a "sideshow," while speaking at the Goldman Sachs Technology and Internet Conference. Einhorn's firm quickly fired back against Apple.

(Read More: Apple's Tim Cook Needs to Answer $137 Billion Question )

"If Apple thinks the lawsuit is a waste of resources it could simply end the matter by complying with existing law and filing a new proxy that unbundles the proposed changes to the charter so that shareholders can express their views on each matter separately," a Greenlight spokesperson said in a statement.

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