MONY Group, Inc. v. Highfields Capital Management, L.P.

The corporate management of MONY Group, Inc. (MONY) (plaintiff) sought shareholder approval of a proposed corporate merger under Delaware law, which required that 51 percent of MONY’s shareholders vote in favor of the merger. Highfields Capital Management L.P., Longleaf Partners Small-Cap Fund, and Southeastern Asset Management (the institutional shareholders) (defendants) were institutional shareholders of MONY that opposed the merger. MONY filed a proxy statement with the Securities and Exchange Commission (SEC) and issued a proxy card to the shareholders to vote on the proposed merger. Thereafter, the institutional shareholders planned to send a solicitation to MONY’s shareholders that included a letter urging the shareholders to withhold their approval of the proposed merger, which an exemption to the SEC proxy rules permitted without the need for compliance with the SEC’s disclosure requirements. Before doing so, the institutional shareholders asked SEC staff whether they could include in their solicitation a duplicate copy of the proxy card issued by MONY’s management without triggering the SEC’s disclosure requirements. The SEC staff advised the institutional shareholders of the SEC’s nonpublished opinion, stated in an informal letter, that gave qualified approval of this action. Accordingly, the institutional shareholders planned to distribute the duplicate proxy card in their solicitation. MONY sued the institutional shareholders and sought an injunction preventing the institutional shareholders from distributing the duplicate proxy card on the ground that the institutional shareholders had not complied with the SEC’s disclosure requirements. The district court found that the inclusion of the duplicate proxy card did not constitute a form of revocation and denied MONY’s injunction request. MONY appealed.