Wednesday, 27 July 2016
Last updated 6 min ago
Jan 30 2007 | 1:59pm ET
Reliant Energy is counting on geography to fend off a proxy battle with hedge fund Seneca Capital.
The Houston-based energy company asked a U.S. District Court to allow it to exclude Seneca’s proxy material, arguing that a ruling by the New York-based Second Circuit Court of Appeals is not binding on a Texas-based company. Like the Second, Seneca is headquartered in New York.
Seneca is seeking a change that would allow shareholders to nominate directors. The New York case, which also dealt with director nominations and cited by Seneca in its bid to get on Reliant’s proxy, dealt with a Hewlett-Packard proxy.
In addition, Reliant savaged Seneca’s plans, arguing it is “contrary to applicable securities laws.”
“Seneca’s shareholder access proposal is the opposite of good governance—an ill-considered bylaws amendment without either safeguards or clear procedures that would only serve to benefit certain large shareholders at the expense of all others,” Reliant said.