Rauchman v. Mobil Corp.
Sixth Circuit Court of Appeals
739 F.2d 205 (1984)
Rauchman (plaintiff), a Mobil Corp. (defendant) shareholder, proposed a bylaw amendment barring citizens of OPEC countries from serving on Mobil's board, motivated by concerns over the board's Saudi Arabian member, Mr. Olayan, who was up for reelection at Mobil's 1982 annual meeting; Mobil refused to include the proposal in its proxy statement, citing SEC Rule 14a-8(c)(8), which permits excluding proposals relating to an election to office. Rauchman sued to force inclusion, and the district court found the proposal related to an election to office because its adoption would make Olayan ineligible for the board, granting Mobil summary judgment.
Whether a company may exclude a shareholder's proposal from its proxy statement where the proposal would prevent a person up for reelection to the board of directors from sitting on the board.