Kramer Levin Successfully Defends Client Globecomm Systems Inc. In Proxy Disclosure Suit

As reported by the New York Law Journal, Reuters and others, on November 14, 2012 New York State Supreme Court Justice Thomas Whelan denied a motion to enjoin the annual shareholder meeting of Globecomm Systems, a leading global communications solutions provider, until such time as Globecomm made purportedly “more complete” disclosures in its proxy statement. Plaintiffs’ class action complaint alleged that Globecomm’s directors had breached their fiduciary duties by not disclosing certain information concerning (i) a proposal to increase shares held in reserve for Globecomm’s stock incentive plan and also (ii) a non-binding, advisory vote on executive compensation called for by the Dodd-Frank Reform and Consumer Protection Act. The suit is part of a new wave of litigation challenging compensation disclosures by public companies after the passage of Dodd-Frank. The Court denied plaintiffs’ motion on numerous grounds, and held that any purported non-disclosures were not material. After the Court denied plaintiffs’ motion, plaintiffs voluntarily dismissed their complaint with prejudice.

The Kramer Levin team consisted of Litigation partner Jonathan M. Wagner, Corporate partner Richard H. Gilden, and Litigation associate Tobias B. Jacoby.