Another investor sues Apple, taking a page from Einhorn playbook

NEW YORK (REUTERS) - Apple Inc on Wednesday was hit by another shareholder lawsuit, a case that is similar to the court challenge that star hedge fund manager David Einhorn brought as part of his push to unlock the company's cash hoard.

The new lawsuit, filed by an investor from Pennsylvania in United States (US) District Court in New York, seeks to block Apple from moving forward with a Feb 27 shareholder vote on two proxy proposals.

One of the proposals is the same measure Mr Einhorn targeted that would eliminate from the company charter Apple's ability to issue preferred stock.

The other, which was not part of Mr Einhorn's case, involves an advisory "say-on-pay" vote for shareholders to weigh in on Apple's executive compensation.

The lawsuit accuses the iPhone maker of failing to disclose details of how it determined top executives' pay.

The plaintiff is Mr Brian Gralnick of Elkins Park, Pennsylvania. He has been an Apple shareholder since 2007, the lawsuit said. It does not list the size of his stake.

"The case has some overlap with the Einhorn case, but it is a broader case," said Mr Arnold Gershon, a lawyer for Gralnick at the law firm Barrack, Rodos & Bacine.

An Apple spokesman had no immediate comment.

Mr Gershon also said his client would seek to be heard at a Feb. 19 hearing in Mr Einhorn's lawsuit.

Mr Einhorn and his Greenlight Capital sued Apple on Thursday in the same court as part of a bigger effort to get the company to share more of its US$137 billion (S$170.2 billion) pile of cash and marketable securities with investors.

He accuses Apple of violating a Securities and Exchange Commission rule prohibiting companies from "bundling" unrelated matters into one proposal for a shareholder vote.

Apple was due to file court papers replying to Mr Einhorn's case by the end of the day.

On Tuesday, Apple chief executive Tim Cook said the board was considering Mr Einhorn's proposal for the company to issue preferred stock and return more cash to investors, but he called the court challenge "a silly sideshow".

The claim of inadequate executive pay disclosure in Wednesday's case follows other lawsuits in recent months filed against companies seeking injunctions ahead of say-on-pay votes.

The cases have been met with varied success.

In the Apple case, the plaintiff says shareholders do not have adequate information to make a decision on executive pay at the company and he is seeking an injunction against the vote.