Also known as: proxy solicitations · solicit proxies · soliciting proxies · solicitation of proxies
Written by attorneys · grounded in primary & secondary sources — see below
A communication by which a person seeks authority from a corporate shareholder to vote the shareholder's shares at a meeting. The term encompasses both direct requests to furnish, revoke, or withhold proxies and indirect communications reasonably calculated to influence a shareholder's voting decision.
Pinnacle Holdings adopted a bylaw requiring reimbursement of reasonable proxy solicitation expenses once a shareholder's nominees received at least thirty percent of the votes. Pedro Pacheco, a qualifying shareholder, ran a competing slate, spent funds on mailings and consultants, and secured thirty-eight percent of the votes. When the corporate secretary refused payment, the bylaw triggered reimbursement of the documented costs.
Paul Peterson received proxy materials from Prism Analytics that omitted material facts about a proposed merger. After the merger closed, he sued alleging the solicitation was misleading. The court examined whether the solicitation itself formed an essential link in obtaining the shareholder approval needed for the transaction.
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Pulse Media launched a hostile bid for Patriot Insurance and alleged that the target's proxy solicitation contained false statements. A competing bidder sought to assert a private claim under the proxy rules. The court assessed whether the bidder fell within the class the statute was designed to protect.
Paula Pierce bought shares of a company after management issued a proxy statement touting a pending acquisition. When the deal collapsed, she claimed the statement was materially misleading. The court considered whether the solicitation itself supplied the necessary causal link without requiring proof of direct reliance.
Pavel Petrov sued Parklane Hosiery after an SEC action established that the company's proxy statement was false. He moved for summary judgment on the same issues. The court evaluated whether the prior adjudication of the solicitation's falsity could bind the defendants in the private action.
Pilar Pena challenged a charter amendment at Stroud Corporation. The board had not solicited proxies but had sent a notice of the meeting. The court determined whether any additional disclosure obligations arose beyond the statutory notice requirements when no proxy solicitation occurred.
Any request for authority to vote shares counts, as do indirect communications reasonably calculated to influence a shareholder's vote. Courts examine whether the communication is a step in a chain ultimately aimed at obtaining or revoking a proxy.
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It is unlawful to solicit proxies until the solicitor has first delivered a proxy statement to the shareholders. Materials must also be filed with the SEC before use.
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No bylaw providing for reimbursement of proxy solicitation expenses may apply to any election for which the record date precedes its adoption.
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Any shareholder meeting the bylaw's stated ownership, holding-period, and procedural conditions may enforce the bylaw. The board retains authority to add reasonable procedures ensuring an orderly process.
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A board may adopt a bylaw that coordinates proxy access and reimbursement rights, including a condition requiring waiver of reimbursement in exchange for inclusion, provided the condition promotes a reasonable and orderly election process.
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…we did not require proof that material omissions or misstatements in a proxy statement decisively affected voting, because the proxy solicitation itself, rather than the defect in the solicitation materials, served as an essential link in the transaction. See Mills v. Electric Auto-Lite Co., 396 U. S. 375, 384-385 (1970). The modern…