Greenlight Capital, L.P. et al v. Apple, Inc.

Filing 28

MEMORANDUM AND ORDER: For the reasons stated above, the Court finds that Greenlight and Gralnick have demonstrated by a clear showing that they have satisfied the elements for a preliminary injunction regarding Proposal No. 2. Accordingly, their motions regarding Proposal No. 2 are GRANTED, and Apple is HEREBY ENJOINED from (1) certifying or accepting proxy votes cast in connection with Proposal No. 2, (2) amending its Articles based on such votes, or (3) proceeding with its shareholder meeting in violation of SEC rules concerning Proposal No. 2. However, the Court finds that Gralnick has not demonstrated by a clear showing that he satisfies the elements for a preliminary injunction regarding Proposal No. 4. Accordingly, his motion regarding Proposal No. 4 is DENIED. Further, pursuant to Federal Rule of Civil Procedure 65(c), a preliminary injunction must be secured by an amount that the court considers proper to pay the costs and damages sustained by any party found to have been wrongfully enjoined or restrained. However, Apple does not state an appropriate amount for a bond, nor does it request one. Accordingly, the Court will not order Greenlight and Gralnick to post a bond at this time.Finally, IT IS HEREBY ORDERED THAT, no later than March 1, 2013, the parties shall submit a joint letter outlining the next contemplated steps in this case, as well as a joint proposed case management plan and scheduling order. A template can be found at http://nysd.uscourts.gov/cases/show.php?db=j udge _info&id=34 7. (Signed by Judge Richard J. Sullivan on 02/22/2013) (jcs)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
_____________________
No. 13 Civ. 900 (RJS)

_____________________

GREENLIGHT CAPITAL, L.P., et al.,
Plaintiffs,
VERSUS

APPLE, INC.,
Defendant.
_____________________
No. 13 Civ. 976 (RJS)

_____________________

BRIAN GRALNICK,
Plaintiff,
VERSUS

APPLE, INC.,
Defendant.
__________________
MEMORANDUM AND ORDER
February 22, 2013

__________________

RICHARD J. SULLIVAN, District Judge:
In preparation for its annual shareholder
meeting, Defendant Apple, Inc. (“Apple”)
issued a definitive proxy statement (the

“Proxy Statement”) and proxy card (the
“Proxy Card”) soliciting shareholder votes on
a range of proposals. Plaintiffs Greenlight

Capital, L.P.; Greenlight Capital Qualified,
L.P.; Greenlight Capital Gold, L.P.;
Greenlight Capital Offshore Partners; and
Greenlight Capital Offshore Master Gold,
Ltd. (collectively, “Greenlight”) assert that
Proposal Number 2 of the Proxy Statement
and Proxy Card violates the “unbundling”
rules promulgated by the Securities and
Exchange Commission (“SEC”), which
require that a proxy permit shareholders to
vote separately on each matter presented for
consideration.
Plaintiff Brian Gralnick
(“Gralnick”), in addition to bringing his own
bundling claim with respect to Proposal
Number 2, asserts that Proposal Number 4 of
the Proxy Statement and Proxy Card violates
the “say-on-pay” rules promulgated by the
SEC, which require disclosure of factors
affecting executive compensation. Before the
Court are Greenlight’s and Gralnick’s
motions seeking to preliminarily enjoin Apple
from giving effect to the challenged votes.
For the reasons that follow, the Court grants
Greenlight’s and Gralnick’s motions
regarding Proposal Number 2, but denies
Gralnick’s motion regarding Proposal
Number 4.

stock is traded on the NASDAQ under the
symbol AAPL. (Green. Mem. 3.) The
Greenlight entities are three limited
partnerships, a partnership, and a limited
liability company, all with their principal
places of business in New York. (Green.
Compl. ¶¶ 2-6.) Greenlight owned 1.3
million Apple shares as of January 2, 2013,
the record date for Apple’s shareholder
meeting. (Id. ¶ 7.) Gralnick, an individual,
has been an Apple shareholder since 2007.
(Gral. Compl. ¶ 9.)
In preparation for its annual shareholder
meeting, scheduled for February 27, 2013,
Apple filed a preliminary proxy statement
with the SEC on December 27, 2012, and
issued the Proxy Statement and Proxy Card to
shareholders on January 7, 2013. (Green.
Compl. ¶ 12, Ex. A; Gral. Compl. ¶ 11; Tr.
Of Oral Arg., dated Feb. 19, 2013 (“Tr.”),
35:23.) The proxy materials included six
proposals for shareholder consideration, two
of which are at issue in this action.
1. Proposal Number 2
Proposal Number 2 in the Proxy
Statement (“Proposal No. 2”) seeks to
amend Apple’s Restated Articles of
Incorporation (the “Articles”).
(Green.
Compl. ¶ 13, Ex. A 1, 44-46, 54-61; Gral.
Compl. ¶ 14.) Specifically, Proposal No. 2
seeks proxies to:

I. FACTS 1
A. Background
Apple, the technology giant, is a
California corporation with its principal
place of business in California and a
permanent office in New York. (Green.
Compl. ¶¶ 8, 11; Gral. Compl. ¶ 10.) Its

[(1)] eliminate certain language
relating to the term of office of
directors in order to facilitate the
adoption of majority voting for the
election of directors; [(2)] eliminate
“blank check” preferred stock; [(3)]
establish a par value for [Apple’s]
common stock of $0.00001 per
share; and [(4)] make other
conforming changes . . . , including
eliminating provisions in the Articles

1

The facts are taken from Greenlight’s Complaint
(“Green. Compl.”) and Gralnick’s Complaint (“Gral.
Compl.”). In ruling on Plaintiffs’ motions, the Court
considered Greenlight’s memorandum of law
(“Green. Mem.”); Apple’s opposition brief (“Opp’n
to Green.”); and Greenlight’s reply brief (“Green.
Reply”); as well as Gralnick’s memorandum (“Gral.
Mem.”); Apple’s opposition (“Opp’n to Gral.”); and
Gralnick’s reply (“Gral. Reply”); along with the
declarations and exhibits attached thereto.

2

relating to
[Apple].

preferred

stock

preferred shares to its existing shareholders
in a bid to return value to Apple investors.
(Id.) Nevertheless, in September 2012,
Apple rejected Einhorn’s proposal and
instead moved forward with the planned
elimination. (Id.; Opp’n to Green. 9.)

of

(Green. Compl. Ex. A 44.) The first item in
Proposal No. 2 would facilitate majority
voting for incumbent members of Apple’s
Board of Directors (the “Board”) under
California law. (Id. at 45.) Though Apple
shareholders endorsed majority voting in
2011, and the Board acceded in 2012, the
amendment is necessary to conform the
Articles to state law. (Opp’n to Green. 16.)
The second item would revoke the Board’s
power to unilaterally issue preferred stock –
that is, stock providing greater rights and
privileges than Apple common stock –
thereby requiring shareholder approval of
any future issuance. (Green. Compl. Ex. A
45.) The third item would establish a
nominal par value for Apple’s common
stock in an attempt to avoid state fees
stemming from Apple’s no-par shares. (Id.
at 45-46.) The final item would eliminate
certain obsolete provisions in the Articles.
(Id. at 46.)

On February 1, 2013, Greenlight urged
Apple to withdraw the “blank check”
amendment. (Green. Compl. ¶ 18.) On
February 5, 2013, Greenlight reiterated its
request and, in the alternative, pressed Apple
to break up Proposal No. 2 into separate
voting items given Greenlight’s support for
at least two of the four amendments. (Id.;
Einhorn Decl. Feb. 6 ¶¶ 10-11.) Apple
declined. (Einhorn Decl. Feb. 6 ¶ 12.)
Accordingly, Greenlight filed suit on
February 7, 2013, alleging that the up-ordown vote on Proposal No. 2 violated SEC
Rules 14a-4(a)(3) and (b)(1).
(Green.
Compl. ¶ 15); see 17 C.F.R. § 240.14a4(a)(3), (b)(1). Gralnick followed suit on
February 12, 2013, advancing similar
claims. (Gral. Compl. ¶ 15; Decl. of Brian
Gralnick, dated Feb. 12, 2013, Gral. Doc.
No. 15 (“Gralnick Decl.”), ¶ 4.)

The history of Proposal No. 2 is a
contentious one. Presently, Apple’s Board
has the authority to unilaterally issue
preferred stock. (See Opp’n to Green. 5-6.)
This power – commonly referred to as
“blank check” authority – has been derided
by shareholder rights advocates given its
potential use as an anti-takeover tactic, and a
number of companies have removed such
provisions from their charters. (Id.) In May
2012, Apple began the process of
eliminating the provision from its Articles.
(Id. at 7.) However, that same month,
Greenlight
principal
David
Einhorn
(“Einhorn”) approached Apple with a
proposal to utilize its “blank check” power.
(Decl. of David Einhorn, dated Feb. 6, 2013,
Green. Doc. No. 6 (“Einhorn Decl. Feb. 6”),
¶ 3.)
In a conference call, Einhorn
encouraged Apple to issue perpetual

2. Proposal Number 4
Proposal Number 4 in the Proxy
Statement (“Proposal No. 4”), or the “sayon-pay proposal,” seeks “advisory vote[s] to
approve the compensation of [Apple’s]
named executive officers.” (Green. Compl.
Ex. A 47.) Though Apple’s 2012 executive
compensation has already been paid, the
“say-on-pay” vote permits shareholders an
opportunity to express their opinion on
Apple’s compensation program. (Id. at 49.)
The outcome of the vote may also inform
Apple’s “future compensation decisions.”
(Id.) To provide a basis for the vote, and
pursuant to SEC disclosure rules, the Proxy
Statement details Apple’s executive
compensation in a sixteen-page report called
3

the Committee, the Committee’s
assessment
of
[Apple’s]
performance, the input received from
[Apple CEO] Cook, as well as the
input and peer group data provided
by [Apple’s executive compensation
consultant].

the Compensation Discussion and Analysis
(“CD&A”). (See id. at 25-42.) The CD&A,
inter alia, lists the elements of Apple’s
compensation for named executives;
discusses the purpose of each element and
the method of award; describes Apple’s
philosophy for awarding compensation, with
a focus on “exceptional personal
performance” and “internal equity”;
provides an assessment of the company’s
performance; lists the members of the
Compensation Committee as well as their
backgrounds and qualifications; emphasizes
the weight given to the input of Apple CEO
Tim Cook (“Cook”) concerning the
performance and compensation of the
named executives; and catalogs the peer
firms considered in connection with Apple’s
compensation decisions as well as the
criteria used to select those firms. (Id.)

(Id. at 30.) The CD&A also discloses that,
in November 2011, four Apple executives
were granted 150,000 RSUs each, totaling
approximately $60 million per executive on
the date of the grant. 2 (Id.; Gral. Compl.
¶ 25.)
On February 12, 2013, in addition to his
bundling complaint, Gralnick filed a claim
that Proposal No. 4 violates SEC disclosure
requirements on the ground that Apple’s use
of terms like “experiences,” “input,” and
“peer group data” fails to provide an
intelligible basis for shareholders to judge
Apple’s executive compensation decisions,
particularly the sizeable RSU awards. (Gral.
Compl. ¶¶ 22-23);
see 17
C.F.R.
§ 229.402(b)(1)(v).

Among the elements of executive
compensation listed in the CD&A are
“[l]ong-term equity awards in the form of
[restricted stock units, or] RSUs[, which]
constitute the majority of each named
executive officer’s total compensation
opportunity.” (Id. at 48; see id. at 29.)
Regarding the award of RSUs, the CD&A
states that:

B. Procedural History
Greenlight filed its Complaint on
February 7, 2013, alleging violations of
Section 14 of the Securities Exchange Act of
1934 (the “Exchange Act”), 15 U.S.C.
§ 78n, and Rules 14a-4(a)(3) and (b)(1)
promulgated thereunder. (Green. Compl.
¶ 24); see 17 C.F.R. § 240.14a-4(a)(3),
(b)(1). That day, Greenlight also moved by
Order to Show Cause for a Preliminary
Injunction
to
enjoin
Apple
from
(1) certifying or accepting proxy votes cast
in connection with Proposal No. 2,
(2) amending its Articles based on such
votes, or (3) proceeding with its shareholder

The Compensation Committee’s
determination of the size of the RSU
awards
was
a
subjective
determination. The Compensation
Committee believed that the RSU
awards should be meaningful in size
in order to retain [Apple’s] executive
team during the CEO transition.
There was no formula or peer group
“benchmark” used in determining
these awards. Rather, the size of the
awards was the result of the
Compensation Committee’s business
judgment, which was informed by
the experiences of the members of

2

Though granted in 2011, the RSU awards are
considered by Apple to be part of its 2012 executive
compensation. (Id. at 31.)

4

Colting, 607 F.3d 68, 79 (2d Cir. 2010).
Finally, a plaintiff bears the burden of
demonstrating “by a clear showing” that the
necessary elements are satisfied. Mazurek v.
Armstrong, 520 U.S. 968, 972 (1997). Failure
to satisfy this burden for any one of the
elements is fatal to a preliminary injunction
claim. eBay Inc. v. MercExchange, L.L.C.,
547 U.S. 388, 391 (2006) (“According to
well-established principles of equity, a
plaintiff seeking a permanent injunction must
satisfy a four-factor test before a court may
grant such relief.”).

meeting in violation of SEC rules. (Green.
Doc. No. 1.)
On February 13, 2013, Gralnick brought
a similar action pursuant to Section 14 of the
Exchange Act; Rules 14a-4(a)(3) and (b)(1);
and SEC Regulation S-K, Item 402(b)(1)(v).
Gralnick seeks identical relief to that sought
by Greenlight with respect to Proposal No.
2, and seeks to enjoin Apple from certifying
or accepting proxy votes cast in connection
with Proposal No. 4, or from proceeding
with its shareholder meeting in violation of
SEC rules regarding the “say-on-pay” vote.
(Gral. Compl. ¶¶ 2-3); see 17 C.F.R.
§ 229.402(b)(1)(v).

III. DISCUSSION
The dimensions of this dispute extend
well beyond the SEC rules invoked in the
Complaints: billionaire hedge fund manager
Einhorn is at odds with Apple over the
future of the company’s capital allocation
strategy. (See Green. Mem. 4; Opp’n to
Green. 8-9.) But despite the sweep of the
parties’ disagreement, the Court’s inquiry
remains a narrow one: whether Apple’s
proxy materials “likely” violate the SEC
rules governing proxies for shareholder vote,
and whether Greenlight and Gralnick will
suffer irreparable harm as a result. The
parties dispute each of the elements of the
preliminary injunction analysis guiding that
inquiry. Accordingly, the Court addresses
each in turn.

Apple filed its opposition to Greenlight’s
motion on February 13, 2013, and to
Gralnick’s motion on February 14, 2013.
(Green. Doc. No. 13; Gral. Doc. No. 7.)
Greenlight and Gralnick both replied on
February 15, 2013. (Green. Doc. No. 22;
Gral. Doc. No. 20.) The Court heard oral
argument on February 19, 2013.
II. LEGAL STANDARD
A preliminary injunction is an
“extraordinary remedy.” Winter v. Natural
Res. Def. Council, 555 U.S. 7, 24 (2008). “A
plaintiff seeking a preliminary injunction
must establish [(1)] that he is likely to succeed
on the merits, [(2)] that he is likely to suffer
irreparable harm in the absence of preliminary
relief, [(3)] that the balance of equities tips in
his favor, and [(4)] that an injunction is in the
public interest.” Winter, 555 U.S. at 20. In
the Second Circuit, a plaintiff may satisfy
the first element of this inquiry by
establishing “either (1) likelihood of success
on the merits or (2) sufficiently serious
questions going to the merits to make them a
fair ground for litigation and a balance of
hardships tipping decidedly toward the party
requesting the preliminary relief.” Salinger v.

A. Proposal No. 2
1. Likelihood of Success on the Merits
To establish a likelihood of success on the
merits, a plaintiff “need not show that success
is certain, only that the probability of
prevailing is ‘better than fifty percent.’”
BigStar Entm’t, Inc. v. Next Big Star, Inc.,
105 F. Supp. 2d 185, 191 (S.D.N.Y. 2000)
(quoting Wali v. Coughlin, 754 F.2d 1015,
1025 (2d Cir. 1985)). Accordingly, the Court
5

separate voting items. However, the question
of what, precisely, constitutes a “separate
matter” has received scant attention from the
courts. Instead, the regulatory treatment of
the rules provides the principal guidance.
Passed in 1992 as part of a package of proxy
amendments, the “unbundling” rules serve a
dual purpose: “to permit shareholders to [(1)]
communicate to the board of directors their
views on each of the matters put to a vote, and
[(2)] not be forced to approve or disapprove a
package of items and thus approve matters
they might not if presented independently.”
Securities Exchange Act Release No. 3430849, 1992 WL 151037, at *6 (Jun. 23,
1992). Accordingly, management may not
propose
several,
aggregated
charter
amendments “by treating them . . . as [one]
vote on the restatement of corporate
documents,” but it may combine “ministerial
or technical matters” that do not alter
substantive shareholder rights. Randall S.
Thomas & Catherine T. Dixon, Aranow &
Einhorn on Proxy Contests for Corporate
Control (“Proxy Contests”) § 9.01, at 9-23, 924 (3d ed. 1999 Supplement) (citing
unmemorialized SEC guidance).

need not determine that Greenlight and
Gralnick have succeeded on the merits to
issue an injunction. It need only decide that
they likely may.
Section 14 of the Exchange Act governs
shareholder proxy solicitations for publicly
traded companies and was enacted in “the
congressional belief that ‘fair corporate
suffrage is an important right that should
attach to every equity security bought on a
public exchange.’” J.I. Case Co. v. Borak,
377 U.S. 426, 431 (1964) (quoting H.R. Rep.
73-1383, at 13 (1934)); see 15 U.S.C. § 78n.
In an effort to achieve that purpose, the SEC
adopted “unbundling” rules, which govern the
substance and form of proxy solicitations.
Rule 14a-4(a)(3), governing substance,
requires that “[t]he form of proxy . . . [s]hall
identify clearly and impartially each separate
matter intended to be acted upon, whether or
not related to or conditioned on the approval
of other matters.” 17 C.F.R. § 240.14a4(a)(3) (emphasis added). Rule 14a-4(b)(1),
governing form, requires that shareholders be
given “an opportunity to specify by boxes a
choice between approval or disapproval of, or
abstention with respect to each separate
matter referred to therein as intended to be
acted upon.” 17 C.F.R. § 240.14a-4(b)(1)
(emphasis added). Thus, the “unbundling”
rules, by their plain terms, “require distinct
voting items on ‘each separate matter’” in a
management proposal. Koppel v. 4987 Corp.,
167 F.3d 125, 138 (2d Cir. 1999) (quoting 17
C.F.R. § 240.14a-4(a)(3), (b)(1)). “[W]hat
constitutes a ‘separate matter’ for purposes of
the two rules is ultimately a question of fact to
be determined in light of the corporate
documents and in consideration of the SEC’s
apparent preference for more voting items
rather than fewer.” Id.

Given the language and purpose of the
rules, it is plain to the Court that Proposal No.
2 impermissibly bundles “separate matters”
for shareholder consideration. Even ignoring
the mere formulation of Proposal No. 2 as
four distinct changes, which “alone suggests
the[ir] separability,” Koppel, 167 F.3d at 138,
the present bundling of items forces
shareholders, including Greenlight and
Gralnick, to “approve or disapprove a
package of items and thus approve [or
disapprove] matters they [would] not if
presented
independently,”
Securities
Exchange Act Rel. No. 34-30849, 1992 WL
151037, at *6 (Jun. 23, 1992). Further, the
bundling denies shareholders like Greenlight
and Gralnick the ability to “communicate to

Indisputably, if the items in Proposal No.
2 constitute “separate matters” for shareholder
consideration, they must be unbundled into
6

proxy statements cited by Apple have been
held to comply with SEC rules. There is a
vast difference between compliant proxies
and non-compliant but unchallenged proxies,
and the latter proxies are irrelevant to this
Court. Apple cites no case law or regulatory
authority endorsing such bundling proposals;
consequently, Apple’s assertion regarding
“other charter amendments” offers no
guidance with respect to this matter.

the [Board] their views on each of the matters
put to a vote.” Id.
Apple endeavors to avoid that finding by
arguing that Proposal No. 2 complies with the
“unbundling” rules because it (a) offers only
one matter for consideration – whether to
amend the Articles; (b) is in keeping with
common proxy practice; (c) has not been
challenged by the SEC; (d) does not group
“material” matters – that is, matters affecting
substantive shareholder rights; and (e) does
not pair pro-shareholder amendments with
provisions harming shareholder interests.
(Opp’n to Green. 12-16.) Apple’s arguments
are unavailing.

c. SEC Inaction
Apple next presses the Court to infer
compliance from the SEC’s inaction,
particularly because Apple “specifically
highlight[ed]” Proposal No. 2 in its
December 2012 submission to the SEC. (Id.
at 12); see Sherman v. Posner, 266 F.Supp.
871, 874 (S.D.N.Y.1966) (stating that
“[SEC] inaction . . . is to be accorded some
weight where . . . the information which
forms the basis for an injunctive motion
previously has been brought to the attention
of the [SEC] and the [SEC] has presumably
approved issuance of the material”). The
Court declines to draw such an inference.
First, as the SEC’s own regulations make
clear, “[t]he fact that a proxy statement, form
of proxy[,] or other soliciting material has
been filed with or examined by the [SEC]
shall not be deemed a finding by the [SEC]
that such material is accurate or complete or
not false or misleading, or that the [SEC] has
passed upon the merits of or approved any
statement contained therein or any matter to
be acted upon by security holders.” 17 C.F.R.
§ 240.14a-9(b). Indeed, the “SEC has made
clear . . . that it needs private actions as a
supplement to its efforts to enforce Rule 14a4’s separate matter requirement due to its
limited staff resources.” Koppel, 167 F.3d at
136 (internal quotation marks omitted). More
importantly, even assuming, like the district
court in the 1966 Sherman decision, that the
SEC’s silence should be accorded “some

a. Proposal No. 2’s Purpose of
Amending the Articles
Apple argues that “Proposal No. 2 does
not constitute improper ‘bundling’ [because]
. . . shareholders are only being asked one
thing – whether to amend the Articles.” (Id.
at 12.) But it is irrelevant that Proposal No. 2
is limited to amending the Articles – it
presents four separate amendments for
consideration that, unless ministerial or
technical, require separate shareholder votes.
Holding
otherwise
would
preclude
application of the “unbundling” rules to all
but the most egregious proxy packaging, and
would ignore the information-forcing benefit
of permitting separate votes on separate
amendments.
b. Common Proxy Practice
Apple also contends that “[m]any proxy
statements have combined into a single
proposal changes to eliminate authority to
issue ‘blank check’ preferred stock together
with other charter amendments.” (Id. at 13.)
However, the fact that other companies have
bundled similar proposals in their proxy
statements is of no moment as none of the
7

Apple’s next assertion – that the
remaining items are not material and thus
Proposal No. 2 is in compliance – presents a
closer question, but is also unpersuasive.
First, it is far from obvious that the director
term and par value items are merely
immaterial, “technical” amendments. Apple
posits that they are not material because the
former merely formalizes an already
adopted proposal, while the latter concerns a
nominal value change not affecting
shareholder rights.
Accordingly, Apple
claims, shareholders may cast their votes on
Proposal No. 2 on the basis of the “blank
check” amendment alone. (Opp’n to Green.
15-16.) Yet, in the next breath, Apple
contradicts its own argument. Apple states
that the director term change is required to
conform the Articles to California law, and
in contesting irreparable harm, claims that
an injunction would burden Apple and its
shareholders due to lost reductions in fees
expected from the par value change. (Id. at
3, 16, 20-21.) Thus, by Apple’s admission,
Proposal No. 2 forces shareholders who
oppose the “blank check” amendment to
either vote in support of the entire package –
registering a false vote in favor of the
preferred stock change – or vote down the
entire proposal – risking a failed Board
election and increased fees. Of course, the
“unbundling” rules were intended to prevent
just such a dilemma.
Moreover, in
reviewing Proposal No. 2, one proxy
advisory service deemed the director term
the “most significant of the proposed
changes” (Decl. of Gene D. Levoff, dated
Feb. 13, 2103, Green. Doc. No. 16 (“Levoff
Decl.”), Ex. E at 10), while another stated
that, though “two of the proposed
amendments are primarily technical in
nature, two others – those involving the
implementation of majority voting and the
elimination of ‘blank check’ preferred stock
– warrant further analysis” (id. Ex. F at 8).

weight,” the fact remains that the Court is
not “relieved of its obligation to exercise its
independent judgment as to whether the
[proxy materials] complied with [SEC
rules].” Pabst Brewing Co. v. Jacobs, 549
F. Supp. 1068, 1076 (D. Del. 1982)
(ordering relief where proxy materials likely
violated SEC rules). Here, regardless of the
SEC’s inaction, the Court believes that the
proxy materials are plainly noncompliant
with the clear requirements of Rule 14a-4.
d. “Material” Matters
Apple’s next argument, that the
amendments are “technical” or “ministerial”
and thus not subject to the bundling
requirement, is equally unavailing given the
amendments at issue in Proposal No. 2.
(Opp’n to Green. 14-16.) As an initial matter,
Apple’s argument that the “blank check”
amendment is not material strains reason.
(Id. at 16.)
Apple asserts that the
amendment is not material because the
Board would not issue preferred stock
without shareholder approval, regardless of
its “blank check” authority. That is, “the
Board has effectively said – by unanimously
voting to present the [‘blank check’]
proposal to shareholders – that it would seek
shareholder approval before issuing
preferred stock.” (Id.) Of course, the Board
has said no such thing. It is true that
Apple’s Board has demonstrated restraint in
using its “blank check” authority, but
declining to use power does not amount to
elimination of that power. There is no
reason to believe that a future Board, or
even this Board, could not be persuaded to
use its “blank check” authority to free
capital. Further, the very existence of this
action and the merits debate over the
amendment suggests that elimination of the
“blank check” provision is indeed material.
(See Green. Reply at 3.)

8

shareholders, and not boards of directors,
who have the exclusive right to decide what
is, in fact, truly “pro-shareholder.” Here,
Greenlight and Gralnick oppose the “blank
check” amendment on the grounds that it
potentially undermines the value of Apple
stock. Thus, to Greenlight and Gralnick, the
amendment is anti-shareholder – a view they
must be permitted to register. Moreover,
even if there were a “pro-shareholder”
exception to the “unbundling” rules, it is not
clear that Proposal No. 2 would fall under that
exception. As stated, Greenlight and Gralnick
oppose the “blank check” amendment;
following
Greenlight’s
suit,
other
shareholders have voiced similar opposition
(Green. Reply 3); at least one proxy advisory
service recommended a “no” vote on the
amendment because it “could frustrate use by
the [B]oard of a useful tool to unlock
shareholder value” (id. at 2-3); and even
proxy advisory services that endorsed
Proposal No. 2 found that Apple’s bundling
went against shareholder interests (id. at 3;
Levoff Decl. Ex. F at 8 (quoting proxy
advisory service report finding that “[Apple]
has elected to bundle multiple article
amendments into a single proposal, a
practice which we believe negatively affects
shareholders as it prevents them from
judging each amendment on its own
merits”).)
Accordingly, Apple’s view,
sincere or not, that Proposal No. 2 is “proshareholder” has absolutely no bearing on
the Court’s analysis of the SEC’s
“unbundling” rules.

Finally, even if Proposal No. 2’s
remaining items were purely technical, it is
not apparent that that would excuse
compliance with the “unbundling” rules.
Permitting Apple to bundle numerous
“technical” matters with a single material
matter would appear to still violate the letter
of the law – which calls for separate votes for
“separate matters” – as well as its spirit,
because shareholders voting on the “blank
check” amendment might still be swayed by
the presence of the remaining items such that
the resulting vote would not communicate a
clear message on the actual popularity of the
“blank check” item.
For all these reasons, Apple’s materiality
argument is easily rejected.
e. “Pro-Shareholder” Nature of
the Amendments
Apple’s final argument, that Proposal
No. 2 does not violate the “unbundling”
rules because its amendments are all “proshareholder,” misapprehends the rules. First,
coercive manipulation of shareholder votes is
only one of the evils addressed by the
“unbundling” rules. Another purpose is to
“permit shareholders to communicate to the
board of directors their views on each of the
matters put to a vote,” a benefit plainly
squelched by grouping the director term, par
value change, and “blank check”
amendments under one heading. Securities
Exchange Act Release No. 34-30849, 1992
WL 151037, at *6 (Jun. 23, 1992). Further,
the rules do not address intentional coercion
alone.
Instead, the rules require that
shareholders “not be forced to approve or
disapprove a package of items and thus
approve matters they might not if presented
independently.” Id. Thus, application of the
“unbundling” rules does not rest on
management’s view of the benefits of an
amendment – for the simple reason that it is

*

*

*

Given the disparate, material nature of
the items in Proposal No. 2, it is probable
that Apple has improperly bundled four
“separate matters” for a single vote. The
Court thus concludes that Greenlight and
Gralnick have established a “probability of
prevailing [that] is ‘better than fifty percent’”
9

that vein, the Second Circuit has found that
“[i]mpermissible grouping of voting items
[in violation of Rule 14a-4] frustrates fair
corporate suffrage and the voting rights of
shareholders
no
less
than
a
misrepresentation or omission in a proxy.”
Koppel, 167 F.3d at 135-36 (emphasis
added). Perhaps not surprisingly, when faced
with probable violations of proxy rules, the
Second Circuit has expressed “a strong
preference for an injunctive remedy over
damages.” Id. at 137.

and are likely to succeed on the merits of
their claims regarding Proposal No. 2.
2. Irreparable Harm
A finding of “irreparable harm” requires
“an injury that is not remote or speculative
but actual and imminent, and for which a
monetary award cannot be adequate
compensation.” Tom Doherty Assocs., Inc. v.
Saban Entm’t, Inc., 60 F.3d 27, 37 (2d Cir.
1995) (internal quotation marks omitted).
While a “showing of irreparable harm is the
single most important prerequisite for the
issuance of a preliminary injunction,”
Faiveley Transp. Malmo AB v. Wabtec Corp.,
559 F.3d 110, 118 (2d Cir. 2009) (internal
quotation marks omitted), “‘the decision to
grant or to deny a preliminary injunction
depends in part on a flexible interplay
between the likelihood of success and
irreparable harm,’” XL Specialty Ins. Co. v.
Level Global Investors, L.P., 874 F. Supp. 2d
263, 270-71 (S.D.N.Y. 2012) (quoting
Packard Instrument Co. v. ANS, Inc., 416
F.2d 943, 945 (2d Cir. 1969)). Accordingly, a
clear likelihood of success on the merits
requires a relatively lesser showing of harm.

Having carefully reviewed the record
before it, the Court finds that Greenlight and
Gralnick face irreparable harm if they are
compelled to vote on Proposal No. 2 in
violation of SEC rules. By voting either
against the slate of amendments and thus
against two amendments they support, or for
the amendments – including the offending
“blank check” provision that they oppose –
Greenlight and Gralnick will have been
forced to vote on a package of items for
which they did not have a single position, and
denied the right to inform management of
their views on specific items. (Green. Mem.
9; Gral. Mem. 8.)
Apple’s arguments in
opposition
fundamentally misunderstand the harm
alleged. For instance, Apple insists that there
is no irreparable harm because the “blank
check” amendment will not eliminate the
company’s power to issue preferred stock.
(Opp’n to Green. 17-18.) But the harm is that
Greenlight and Gralnick will be forced to cast
an unrepresentative and illegal vote, not that
they might be denied their desired substantive
outcome. Apple’s contention that any harm is
mooted because shareholders could reinstate
the “blank check” provision through a later
proxy vote is likewise beside the point.3 If

The Second Circuit has considered
irreparable harm in connection with proxy
votes, stating that “[i]n passing Section 14(a),
Congress sought to avoid a very particular
harm – the solicitation of shareholder proxies
without adequate disclosure. The SEC rules
promulgated under Section 14(a) are intended
to level somewhat the playing field for proxy
contestants and to force disclosures that
promote informed shareholder voting.”
MONY Grp., Inc. v. Highfields Capital
Mgmt., L.P., 368 F.3d 138, 147-48 (2d Cir.
2004). Thus, “[i]t is well-established that a
transaction . . . that is influenced by
noncompliance with the disclosure provisions
of the various federal securities laws can
constitute irreparable harm.” Id. at 147. In

3

Apple also ignores a glaring concern with its
proposal: Apple’s bylaws count shares that are not
voted as opposing amendments. (Green. Reply 8.)

10

Proposal No. 2 passes, Greenlight and
Gralnick will be hampered with an
amendment to the Articles that they oppose
and which Apple presented illegally. If
Proposal No. 2 fails, Greenlight and Gralnick
will still have been denied their legal right to
an unbundled vote. More importantly, they
will have been denied the opportunity to
communicate to management the true depth
of Proposal No. 2’s unpopularity – offending
both purposes of the “unbundling” rules.4

monetary damages apply. (Tr. 10:9-15.)
Further, if the Court were to issue an
injunction at a later date, it is unclear whether
or how Apple could unwind shareholderratified amendments to its Articles –
amendments that may trigger filings with the
California Secretary of State, as well as
multiple other states’ agencies regarding the
par value amendment. (Tr. 12:2-16.)
Thus, the Court does not conclude, as
Apple suggested at oral argument, that any
violation of an SEC rule is a per se harm.
(Tr. 30:16-20.) Instead, the Court finds on the
facts before it that a vote on Proposal No. 2
would compel Greenlight and Gralnick to
vote against their interests, and that the
consequences stemming from a vote on
Proposal No. 2 would be, to borrow a phrase
repeatedly invoked by the parties at oral
argument, an exceedingly difficult “egg” to
“unscramble.” (Tr. 30:20-22.) Accordingly,
the Court finds that Greenlight and Gralnick
have established irreparable harm, particularly
in light of their strong likelihood of success
on the merits. See XL Specialty Ins. Co., 874
F. Supp. 2d at 270-71.

In addition, the Court concludes that any
lesser remedy would fail to provide
Greenlight and Gralnick with adequate relief.
Significantly, the Second Circuit states a
strong preference for injunctive relief in the
proxy context. Koppel, 167 F.3d at 137-38.
Not surprisingly, the parties agree that no
Accordingly, any shares not voted on Proposal No. 2
would count against eliminating the “blank check”
authority. But any shares not voted on a future,
restorative amendment would count against reinstating
the “blank check” authority. Thus, the deck would be
stacked against Greenlight and Gralnick in any effort to
restore the status quo with respect to the issuance of
preferred stock.
4

Nevertheless, the Court does agree with Apple that
Greenlight and Gralnick were slow to bring suit,
waiting six weeks after the preliminary proxy materials
were released to file their actions. (See Opp’n to
Green. 19 (citing Appalseed Prods., Inc. v.
MedianetDigital, Inc., 2012 WL 2700383, at *10
(S.D.N.Y. July 6, 2012); Grout Shield Distribs., LLC v.
Elio E. Salvo, Inc., 824 F. Supp. 2d 389, 403 (E.D.N.Y.
2011).) However, this fact alone is not fatal to their
motions. While the delay weighed heavily in the
Court’s analysis given the time and expense that might
have been spared had they acted before the Proxy
Statement and Proxy Card were released, the lapse of
time is not so “unreasonable” as to support denial of
their motions. First, the cases Apple cites involve
situations in which plaintiffs waited many months and
even years, not weeks, before seeking judicial
intervention. Second, those cases deal in continuing
harms where the plaintiffs plainly acquiesced to the
injury. Here, the injury identified by Greenlight and
Gralnick has not yet occurred – and may yet be
prevented – making a preliminary injunction the proper
form of relief.

3. Balance of the Hardships
“[T]he balance of hardships inquiry asks
which of the two parties would suffer most
grievously if the preliminary injunction
motion
were
wrongly
decided.”
Tradescape.com v. Shivaram, 77 F. Supp. 2d
408, 411 (S.D.N.Y. 1999). Here, the balance
of hardships tips in Greenlight’s and
Gralnick’s favor, as a denial of their motions
would prevent them and thousands of other
Apple shareholders from exercising “fair
corporate suffrage,” whereas granting their
motions will merely require Apple to come
into compliance with Rules 14a-4(a)(3) and
(b)(1) – at an earlier date than would
otherwise inevitably result at the conclusion
of this action.
11

Apple strenuously objects that an
injunction would mark “an unprecedented
interference [into] the exercise of corporate
suffrage by one of the most respected
companies in America.” (Tr. 32:3-5.) But
Apple fails to acknowledge that this
“interference” occurred more than ten years
ago when the SEC adopted the “unbundling”
rules; the Court now simply requires
compliance with the clear dictates of those
rules. Apple further argues that its own costs
will be sizeable – approximately $3 million to
amend and reissue the proxy materials for a
special vote after the annual shareholder
meeting. (Tr. 40:3-6.) However, this cost is a
direct result of Apple’s failure to comply with
SEC rules, represents a tiny sum for a
company worth approximately $400 billion,
and may be avoided if Apple delays
consideration of the items in Proposal No. 2
until its next shareholder meeting. (See
Green. Reply 9.) Apple also claims that a
delayed vote on Proposal No. 2 would impose
a “serious financial burden” on it and its
shareholders due to the loss of expense
reductions expected from the par value
change. 5 (Opp’n to Green. 20-21.) While
that may be the case, it would be perverse to
permit Apple to proceed with a bundled proxy
vote merely because it desires quick passage
of one of the items it chose to bundle.

with the proxy rules are able to go to court to
obtain equitable relief to assure that their
opponents play by those rules.” Amicus Brief
of the SEC, Koppel, 167 F.3d 125, 1998 WL
34088514, at *15-16.
Accordingly, an
injunction to force compliance with the
securities laws is in the public interest. Apple
insists that Proposal No. 2’s “proshareholder” bent – to increase shareholder
suffrage – is in the public interest and,
therefore, the vote should not be barred.
(Opp’n to Green. at 21-22.) However, as
noted above in connection with Apple’s
arguments concerning likelihood of success
on the merits, this is precisely the type of
substantive judgment that the “unbundling”
rules require be left to shareholders, not to
courts and certainly not to boards of directors.
Because the bundling in Proposal No. 2
denies Apple’s shareholders that opportunity,
the Court finds that an injunction would be in
the public interest.
*

*

*

For the foregoing reasons, the Court
concludes that Greenlight and Gralnick are
likely to succeed on the merits and face
irreparable harm if the vote on Proposal No. 2
is permitted to proceed. Further, the Court
finds that the balance of hardships tips in
Greenlight’s and Gralnick’s favor, and that a
preliminary injunction would be in the public
interest.
Accordingly, Greenlight’s and
Gralnick’s motions for a preliminary
injunction regarding Proposal No. 2 are
granted, and Apple is hereby enjoined from
(1) certifying or accepting proxy votes cast
in connection with Proposal No. 2,
(2) amending its Articles based on such
votes, or (3) proceeding with its shareholder
meeting in violation of SEC rules. 6

Accordingly, the Court finds that
Greenlight and Gralnick have established that
the balance of the hardships tips in their favor.
4. The Public Interest
“[T]he public interest and investor
protection are well-served when persons
faced with solicitations that do not comply
5

As discussed, Apple’s insistence that a delayed vote
on the par value change would impose serious
hardship on the company undermines Apple’s
assertions as to the amendment’s purported lack of
materiality.

6

This relief does not prevent Apple from holding its
annual shareholder meeting. Instead, it is limited
only to enjoining a vote on Proposal No. 2 at that
meeting or Apple’s taking any related action.

12

shareholder would consider it important in
deciding how to act.” See Hutchison v.
Deutsche Bank Secs. Inc., 647 F.3d 479, 485
(2d Cir. 2011).

B. Proposal No. 4
1. Likelihood of Success on the Merits
Enacted as part of the Dodd-Frank Act in
2010, 15 U.S.C. § 78n-1(a) requires that
companies conduct a non-binding shareholder
vote on executive compensation at least once
every three years. This “say-on-pay” vote
was intended “to empower shareholders” by
giving them “the ability to hold executives
accountable, and to disapprove of misguided
incentive schemes.” Laborers’ Local v.
Intersil, 868 F. Supp. 2d 838, 848 (N.D. Cal.
2012) (quoting Hearing on Executive
Compensation Oversight Before the H.
Comm. on Fin. Servs. (Sept. 24, 2010)
(statement of Rep. Barney Frank, Chairman,
H. Comm. on Financial Services) and 156
Cong. Rec. S5902–01, S5916 (2010)
(statement of Sen. Jack Reed)). Item 402(b)
of Regulation S-K, promulgated thereunder,
requires that, prior to a “say-on-pay” vote,
companies must “[d]iscuss the compensation
awarded to, earned by, or paid to the named
executive officers[;] explain all material
elements of the registrant’s compensation of
the named executive officers[; and] describe
. . . [h]ow the registrant determines the
amount (and, where applicable, the formula)
for each element to pay.”
17 C.F.R.
§ 229.402(b)(1)(v). The rule does not impose
fiduciary duties or require certain methods
for determining compensation.
See 15
U.S.C. § 78n-1(c). However, it does give rise
to a violation of the Exchange Act for failure
to disclose “if either the SEC requirements
specifically require disclosure of the omitted
information in a proxy statement, or the
omission makes statements in the proxy
statement materially false or misleading.”
Vides v. Amelio, 265 F. Supp. 2d 273, 276-77
(S.D.N.Y. 2003) (internal quotation marks
omitted) (discussing CEO compensation).
For an omission to be material, there must be
“a substantial likelihood that a reasonable

Consistent with SEC rules, Proposal No. 4
seeks shareholder advisory votes to approve
Apple’s executive compensation scheme for
fiscal year 2012.7 (Gral. Mem. 2; Green.
Compl. Ex. A 47-49; Opp’n to Gral. 4.) In
addition, the CD&A in the Proxy Statement
describes Apple’s executive compensation
scheme. Spanning sixteen pages, the CD&A
details the amount of compensation awarded;
states the types of awards, including longterm equity awards, cash bonuses, and base
salaries; and sets out the guideposts for
compensation,
including
“exceptional
personal performance,” “internal equity,” and
the input of Apple CEO Cook. (Green.
Compl. Ex. A 25-42.) The CD&A also lists
the members of the Compensation
Committee, along with their backgrounds and
qualifications; describes Apple’s independent
compensation consultant and details its role in
the compensation process; and identifies the
peer firms considered in connection with
Apple’s compensation decisions, as well as
the criteria used in selecting those firms.
(Id.)
The report devotes substantial attention to
Apple’s long-term equity awards – granted in
the form of RSUs – which account for the
“majority”
of
Apple’s
executive
compensation. As noted above, the CD&A
specifically provides that:
The Compensation Committee’s
determination of the size of the RSU
awards
was
a
subjective
7

Apple recommended that shareholders adopt an
annual “say-on-pay” requirement, exceeding the
three year SEC requirement, which they did in 2011.
(See Decl. of Abby F. Rudzin, dated Feb. 13, 2013,
Green. Doc. No. 18 (“Rudzin Decl.”), Ex. G at 2.)

13

determination. The Compensation
Committee believed that the RSU
awards should be meaningful in size
in order to retain [Apple’s] executive
team during the CEO transition.
There was no formula or peer group
“benchmark” used in determining
these awards. Rather, the size of the
awards was the result of the
Compensation Committee’s business
judgment, which was informed by
the experiences of the members of
the Committee, the Committee’s
assessment
of
[Apple’s]
performance, the input received from
[Apple CEO] Cook, as well as the
input and peer group data provided
by [Apple’s executive compensation
consultant].

Gralnick asserts that Apple has not
disclosed the Compensation Committee’s
“experiences” informing its judgment. Yet,
the CD&A lists the Compensation Committee
members as well as their backgrounds and
qualifications – that is, their “experiences.”
(Green. Compl. Ex. A 13-15.) Gralnick
further claims that Apple has not disclosed
the Compensation Committee’s “assessment”
of the company’s performance. However, the
CD&A states that “in 2012, [Apple] had the
highest market capitalization, revenue growth,
and operating income growth of any of the
peer companies” – a glowing “assessment”
underpinning
the
“strong
financial
performance” the Compensation Committee
rewarded in 2012. (See id. at 29, 31.)
Gralnick continues that the description of
Apple CEO Cook’s input in the process is
lacking. But the CD&A describes Cook’s
input as “regarding the performance and
appropriate compensation of the other
named executive officers” to which the
Compensation
Committee
gives
“considerable weight . . . because of
[Cook’s] direct knowledge of each executive
officer’s performance and contributions.”
(Id. at 28.)
In like fashion, Gralnick
questions the CD&A’s failure to disclose the
“peer group data” considered in connection
with the named executive’s compensation,
while ignoring that the CD&A (1) describes
Apple’s executive compensation consultant
as contributing “a range of external market
factors, including evolving compensation
trends, appropriate peer companies and
market survey data”; (2) lists the peer firms
considered in setting Apple’s executive
compensation; and (3) details the criteria for
selecting those firms.
(Id.)
Finally,

(Green. Compl. Ex. A 30.) Nevertheless,
Gralnick alleges that this disclosure is
insufficient under the SEC “say-on-pay”
rules. In particular, Gralnick faults the report
for failing to: identify the Compensation
Committee’s pertinent “experiences” and
“assessment[s],” detail the “input” provided
by Apple CEO Cook, and explain the “peer
group data” used to determine RSU awards.
(Gral. Compl. ¶ 24.)
Without such
information, Gralnick alleges, Apple’s
shareholders cannot make an informed vote
on
Apple’s
executive
compensation,
particularly with respect to the sizeable and
uniform RSU awards. (Id. at ¶ 25; Gral.
Mem. 7-8.) As set forth below, the Court
disagrees, and finds that the depth and breadth
of information disclosed by Apple in the
Proxy Statement is plainly sufficient under
SEC rules. 8
8

It is worth noting that Gralnick does not cite any
other complaints regarding the adequacy of the
CD&A disclosures. Indeed, one proxy advisory
service that recommended approval of Proposal No. 4
stated that it had “thoroughly reviewed [Apple’s
CD&A], as well other relevant SEC filings[, and
u]pon review of [Apple’s] complete executive

compensation program, [fou]nd that [Apple] ha[d]
provided adequate disclosure with regard to both its
short-term and long-term incentive arrangements.”
(Levoff Decl. Ex. F at 15.) Another service that
opposed Proposal No. 4 did so on the merits – not
because it lacked information to make a
recommendation. (Id. Ex. E at 18.)

14

*

Gralnick appears incredulous that Apple
would reward its top executives so
handsomely and in equal shares. (Tr. 21:1317.) However, the CD&A pointedly states
that Apple compensates based on
“exceptional personal performance,” as
reflected by Apple’s impressive success, as
well as “internal equity,” explaining the
similarly sized awards “intended to promote
and retain stability within the executive
team.” (Green. Compl. Ex. A 29-31.)
Finally, the CD&A made clear that executive
compensation was set as it was in an attempt
to “retain [Apple’s] executive team during
the CEO transition” – referring to Apple
CEO Steve Jobs’s resignation and death, and
Cook’s elevation to CEO – a period of
transition and potential turmoil that would
explain outsized awards. (Id.) Put simply,
Gralnick’s complaint that the CD&A leaves
shareholders “totally in the dark” on
executive compensation is entirely without
basis. (Tr. 21:13.)

*

*

Although the Court concludes that
Gralnick would be similarly unable to meet
his burden regarding the remaining factors
relevant to the preliminary injunction analysis
– irreparable harm, balance of equities, and
public interest – the Court need not reach
those questions given his failure to establish
the first element, likelihood of success on the
merits. See eBay Inc., 547 U.S. at 391.
Accordingly, Gralnick’s motion regarding
Proposal No. 4 is denied.
IV. CONCLUSION
For the reasons stated above, the Court
finds that Greenlight and Gralnick have
demonstrated by a “clear showing” that they
have satisfied the elements for a preliminary
injunction regarding Proposal No. 2.
Accordingly, their motions regarding
Proposal No. 2 are GRANTED, and Apple is
HEREBY ENJOINED from (1) certifying or
accepting proxy votes cast in connection
with Proposal No. 2, (2) amending its
Articles based on such votes, or
(3) proceeding with its shareholder meeting
in violation of SEC rules concerning
Proposal No. 2. However, the Court finds
that Gralnick has not demonstrated by a
“clear showing” that he satisfies the elements
for a preliminary injunction regarding
Proposal No. 4. Accordingly, his motion
regarding Proposal No. 4 is DENIED.

Indeed, Gralnick concedes that the SEC
“say-on-pay” rules do not require Apple to
adopt a formula or rational method for
determining executive pay. (Tr. 22:20-23:3.)
But Gralnick nowhere points to any additional
information Apple was required to release to
explain its admittedly “subjective” RSU
compensation method, nor does he identify
any material omissions that rendered the
CD&A false or misleading. (Opp’n to Gral.
14; see Gral. Mem. 6-8.) Thus, because
Gralnick has failed to identify any material
omission in the Proxy Statement, and because
the CD&A appears to be wholly compliant
with Item 402(b) of Regulation S-K, the
Court finds that Gralnick is unlikely to
succeed on the merits of his claim regarding
Proposal No. 4. For the same reasons, the
Court concludes that Gralnick has failed to
establish “sufficiently serious questions going
to the merits to make them a fair ground for
litigation.” Salinger, 607 F.3d 68 at 79.

Further, pursuant to Federal Rule of Civil
Procedure 65(c), a preliminary injunction
must be secured by “an amount that the court
considers proper to pay the costs and damages
sustained by any party found to have been
wrongfully enjoined or restrained.” However,
Apple does not state an appropriate amount
for a bond, nor does it request one.
Accordingly, the Court will not order

15

Greenlight and Gralnick to post a bond at this
time.
Finally, IT IS HEREBY ORDERED
THA T, no later than March 1, 2013, the
parties shall submit a joint letter outlining the
next contemplated steps in this case, as well
as a joint proposed case management plan and
scheduling order. A template can be found at
http://nysd.uscourts.gov/cases/show.php?db=j
udge_info&id=34 7.
SO ORDERED.

United States District Judge
Dated: February 22,2013
New York, New York

***
Greenlight is represented by Ashley F
Waters, Christopher Michael
EgJeson,
Michael A. Asaro, and Mitchell P. Hurley,
Esqs., of Akin Gump Strauss lIauer & Feld,
One Bryant Park, New York, New York
10036.
Gralnick is represented by A. Arnold
Gershon, Michael Arthur Toomey, and
William J. Ban, Esqs., of Barrack, Rodos &
Bacine, 425 Park Avenue, Suite 3100, New
York, New York 10022, as well as Jeffrey
Alan Barrack, Esq., of Barrack, Rodos &
Bacine, Two Commerce Square, 200 I Market
Street, Suite 3300, Philadelphia, Pennsylvania
19103.
Apple is represented by Andrew Jay
Frackman and Abby Faith Rudzin, Esqs., of
O'Melveny & Myers LLP, 7 Times Square,
New York, New York 10036.
16