Should Shareholders Expect Greater Boardroom Accountability in 2019 with the Appointment of “Third Point Nominees”?

Proxy contests are one means through which shareholders can voice concerns about board action. Due to their excessively high cost, proxy contests were once somewhat rare; today, however, they are much more common due to the flourish of hedge funds. (Warren S. de Wied, Fried, Frank, Harris, Shriver & Jacobson LLP, Westlaw Practical Law). One such hedge fund contributing to these proxy contests is Third Point, LLC (“Third Point”), founded by Daniel S. Loeb in New York in 1995. (Campbell Soup Co.). This note introduces readers to current trends in activist-led proxy contests, summarizes a recent proxy fight between Third Point and Campbell Soup Co. (“Campbell”), and speculates on how this and similar contests may affect corporate accountability in 2019.Today, activist shareholders (“Activists”) are more likely to initiate proxy fights and, when they do, companies are increasingly more likely to settle, rather than take them to a shareholder…

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