– Reuters (paywall) reported that a conservative federal appeals court judge argued that judicial policymakers wrongly gave in to political pressure to curtail ‘judge shopping’ with a policy change that would deter right-leaning litigants from steering cases to preferred judges.
US Circuit Judge James Ho said the US Judicial Conference’s new judicial assignment policy undercut the judiciary’s independence by giving in to critics engaged in ‘forum shaming’. ‘Judges are supposed to follow the law, not distort the rules to avoid criticism,’ Ho said, according to prepared remarks. ‘The last thing we should do is gerrymander the rules in response to political pressure.’
If implemented, the policy would impact a tactic often used by conservative litigants whereby they file cases in small divisions in Texas’ four federal districts whose one or two judges were appointed by Republican presidents. Those judges have often ruled in their favor. The new policy is non-binding.
– The Financial Times (paywall) reported that activist investor Sparta Capital Management said UK company John Wood Group should either move its listing to the US or consider a sale. The call comes a year after the collapse of a £1.7 bn ($2.1 bn) takeover approach for Wood from private equity firm Apollo.
Franck Tuil, who founded Sparta in 2021, said in the letter to Wood’s board that he was ‘frustrated by the continued underperformance of [Wood’s] shares. If the UK public markets are unwilling or unable to engage in Wood’s story, we believe you should undertake a strategic review and actively seek alternative solutions.’ He also said there had been an increase in M&A activity this year and that financing markets ‘appear to be supportive of public-to-private transactions.’
Wood declined to comment. ‘There has been a lot of popular talk about listing in the US but it is not a silver bullet. The focus right now is on delivering on the three-year strategy announced in November 2022,’ a person close to the company said.
– Republican governors of six states condemned the United Auto Workers’ (UAW) efforts to organize automotive factories in the South, warning the union’s efforts could lead to layoffs and fewer future investments, CNBC reported. The joint statement – signed by the governors of Alabama, Georgia, Mississippi, South Carolina, Tennessee and Texas – came a day before Volkswagen workers in Chattanooga, Tennessee, began voting on whether to join the UAW.
The Volkswagen vote is part of an unprecedented labor-organizing drive announced last year by UAW president Shawn Fain that targets 13 automakers operating in southern states and elsewhere. Last year the union negotiated record contracts with General Motors, Ford Motor and Chrysler parent Stellantis.
The UAW, which is also is in the process of organizing a vote among Mercedes-Benz workers in Alabama, did not respond immediately to CNBC for comment.
– The Wall Street Journal (paywall) reported that Tesla’s board asked shareholders to again vote in favor of CEO Elon Musk’s multibillion-dollar pay package. The board approved the pay proposal in 2018, but a Delaware court in January struck it down because it said the approval process was ‘deeply flawed’.
The board said in a proxy filing that it stands behind the pay package, valued at a maximum of $55.8 bn, that shareholders previously approved. The company also detailed the Delaware court case to give shareholders more information about the negotiations that led to the original pay package and the criticisms raised by the judge. Tesla said a vote in favor of the pay package ‘could avoid a prolonged period of uncertainty regarding the company’s most important employee.’
A spokesperson for the Delaware Court of Chancery, where the pay-package case was heard, declined to comment on Wednesday. Tesla said it plans to appeal the Delaware ruling.
– According to Reuters, Vanda Pharmaceuticals rejected a takeover proposal from Future Pak and adopted a shareholder rights plan, or poison pill, to reduce the likelihood of a hostile takeover. Vanda said its board, along with independent financial and legal advisers, had concluded that Future Pak’s offer significantly undervalued the company and was not in its best interest.
‘We believe our offer for Vanda’s outstanding shares is fair and represents a significant premium for shareholders,’ Reuters was told by a spokesperson for Future Pak, which also reiterated its intention to explore ways to improve the offer.
– The US Department of Justice’s (DoJ) criminal division will give immunity to executives and lower-level employees who provide information about corporate misconduct they themselves were involved in, according to the WSJ. Under the pilot program, prosecutors will enter into a non-prosecution agreement with corporate whistleblowers who meet certain criteria, according to an internal DoJ memo. To be eligible, an individual must voluntarily provide original information, co-operate with prosecutors and agree to give up any profits they may have derived from the reported misconduct.
The potential immunity for tipsters involved in wrongdoing comes after the agency earlier this year said it would develop another pilot program that provides financial incentives to people who blow the whistle on corporate or financial wrongdoing. The department is still in the process of developing its whistleblower award policy, a spokesperson said.
– House lawmakers urged the US Department of State to press the UK and the EU to take a harder line on forced labor linked to China’s Xinjiang region as the EU considers new rules, the WSJ reported. The department should increase US diplomatic efforts to combat China’s alleged use of forced labor, the bipartisan leaders of the House Select Committee on the Chinese Communist Party wrote to Secretary of State Antony Blinken. The state department generally doesn’t comment on congressional correspondence, a spokesperson said.
The US has since 2022 enforced a ban on most goods from China’s Xinjiang region over forced-labor concerns. The law has required many companies to probe their supply chains and snarled imports for some. China has said the allegations underpinning the law are lies and criticized the legislation as interference in its internal affairs. The European Parliament is set to vote this month on a broad ban targeting the import of goods linked to forced labor from around the globe.
– Norges Bank Investment Management (NBIM) said it will support a resolution calling for Goldman Sachs to split the roles of CEO and board chair, Reuters reported. ISS and Glass Lewis have recommended that investors back a shareholder resolution urging the bank to split the two positions, currently held by David Solomon, at the bank’s AGM on April 24.
‘The board should exercise objective judgment on corporate affairs and be able to make decisions independently of management,’ NBIM said in a statement explaining its vote rationale.
Goldman Sachs has recommended investors reject the proposal to split the two roles. The bank did not immediately reply to Reuters’ request for comment on Friday. A similar proposal filed last year drew 16 percent support, including from NBIM.
Ben Maiden
Ben Maiden is the editor-at-large of Governance Intelligence, an IR Media publication, having joined the company in December 2016. He is based in New York. Ben was previously managing editor of Compliance Reporter, covering regulatory and compliance...
