Last week, Apple was hit with a lawsuit from Greenlight Capital, David Einhorn’s hedge fund, in order to contest a proposition which would include a requirement in Apple’s charter that any move to issue preferred stock be approved by Apple’s common shareholders. Today, CEO Tim Cook called that suit a “silly sideshow,” speaking at a Goldman Sachs investor conference.
Cook explained that the disagreement centers around a proposal on Apple’s proxy which it filed back in December, which he said is about the rights of shareholders. It’s not about whether Apple returns additional cash to shareholders, how much it is or what mechanism is used, Cook explained, but only about how the issue of preferred stock gets sign-off. In 2012, Cook said Apple was looking at ways to improve its governance.
“So frankly I find it bizarre that we would find ourselves being sued for something that’s good for consumers,” Cook said. “I think it’s a … it’s a silly sideshow, honestly.” He also shared that his preference is to have both sides take the funds they’re investing in this and donate them to a worthy cause.
“We’re not going to do a mailing campaign on it,” he said. He characterized it as “a waste of shareholder money, and it’s a distraction, and it’s not a seminal issue for Apple.” That said, he’ll support the proposition, but won’t push it hard. Also, he said that regardless of whether it’s in the charter or not, Apple would insist on a vote from common shareholders before issuing any preferred stock.