On February 11, the Staff of the Division of Corporation Finance granted no-action relief regarding Johnson & Johnson’s efforts to omit a shareholder proposal from its proxy statement relating to mandatory arbitration of shareholder claims arising under the federal securities laws.
The Staff granted the request under Rule 14a-8(i)(2), which permits exclusion of a proposal that, if implemented, would cause the company to violate any state, federal or foreign law to which it is subject. This rule includes, but is not limited to, violations of corporate and securities laws. The SEC recognized the legal authority of the New Jersey Attorney General, who issued an opinion that implementation of the proposal would result in a New Jersey state law violation.
The American Association for Justice works to preserve the constitutional right to trial by jury and to make sure people have a fair chance to receive justice through the legal system when they are injured by the negligence or misconduct of others—even when it means taking on the most powerful corporations. Visit http://www.justice.org for more initiative on their many programs and ongoing initiatives. Langdon & Emison attorneys are members of several standing AAJ committees, and the firm is a proud supporter of the AAJ Leaders Forum.
American Association for Justice CEO Linda Lipsen issued the following statement in the wake of the U.S. Securities and Exchange Commission (SEC) granting “no action” relief to Johnson and Johnson:
“Today’s decision from the SEC is a huge victory for investors. As New Jersey’s Attorney General stated, inserting forced arbitration language into Johnson & Johnson’s bylaws would violate state law—but in the bigger picture, forced arbitration robs all citizens of their right to seek public accountability from law-breaking corporations and should never be permitted.
We commend the SEC for this important decision and look forward to continuing this fight.”