Trinity Wall Street v. Wal-Mart Stores, Inc.

792 F.3d 323 (3rd Cir. 2015)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

D rejected of P's request to include its shareholder proposal in D's proxy materials for shareholder consideration. P's proposal was about the sale of high-capacity firearms (guns that can accept more than ten rounds of ammunition) at about one-third of its 3,000 stores. P askes D's board to develop and implement standards for management to use in deciding whether to sell a product that (1) 'especially endangers public safety'; (2) 'has the substantial potential to impair the reputation of Wal-Mart'; and/or (3) 'would reasonably be considered by many offensive to the family and community values integral to the Company's promotion of its brand.' D obtained what is known as a 'no-action letter' from the staff of the SEC's Division of Corporate Finance, thus signaling that there would be no recommendation of an enforcement action against the company if it omitted the proposal from its proxy materials. P filed suit in federal court, seeking to enjoin D's exclusion of the proposal. The District Court initially denied the request, but on the merits, it held that because the proposal concerned D's Board (rather than its management) and focused principally on governance (rather than how D decides what to sell), it was outside D's ordinary business operations. D appealed.