Tuesday, April 21, 2009

The Week from Heck

A week ago, I pushed an OSC (Order to Show Cause) to stop American Express (Amex) from sending out their proxy without my shareholder proposal on stopping discrimination in Amex by having a "Truth Commission" study the problem of Amex's Code of Conduct.

Amex opposed it, and it went before USDJ Koeltl in SDNY (Southern District of New York) federal court. The lead Amex attorney, Ms. Jean Park of Kelley Drye Warren, asked the Judge if she could bring in a "securities lawyer" since her knowledge of securities was "rudimentary." She brought in two partners from Skadden, Arps and Flom. My lead attorney is myself, and I represented my OSC against Joe Sacca of Skadden, who said (words to the effect of -- I have yet to get the transcript) "Amex has never stopped Peter Lindner from communicating with the SEC." To which I replied: "In 2007, Amex got a federal court order from a judge to ask me to withdraw my SEC filing, to take down my website, to not communicate with the SEC, and not attend the Amex April 2007 annual meeting."

So, Amex was probably not prepared.

The judge said I did not prove I had a likelihood of winning the OSC, and that I should have come before him in January 2009. The federal judge then set 3 deadlines for us:

  1. Fri, Apr 17: Amex must respond to the OSC (Order to Show Cause) why they should not be compelled to put in my shareholder proposal in their proxy statement
  2. Tue, Apr 21: Peter Lindner (that's me) has to reply to Amex's response
  3. Thu, Apr 23 at 4:30 pm: Amex and Lindner appear before him at the US SDNY Courthouse at 500 Pearl Street, NY, NY to argue their case. The Courtroom is open if you want to attend: it's 3 blocks from the City Hall subway exit on the 4/5/6 subway line.
Amex said they wanted a slight delay, and the Judge admonished Ms. Park that he was not going to let them "moot" my OSC by having my motion argued after the Mon, Apr 27, shareholder meeting. He gave Amex a half hour to decide if they wanted to speed up the schedule, and they could confer with me. Of course, Amex refused to confer with me, and a half hour later told The Court that they would keep to his proposed schedule.

By the way, did I mention I have a day job (9-5) too?

Then I had to get out 130 copies of my Amex proxy and shareholder proposal to Broadridge, for mailing to shareholders. Broadridge informed me I had to bring it to them personally, since for insurgent shareholders, they do not print versions. I went to the Post Office with a 15 pound box of proxies/voting forms for overnight delivery (Good job, USPS: they have tracking on packages).

On Friday, April 17 was the deadline for Amex to respond to the OSC, which they did with a "memo of law" that had 17 attachments and was about 1-2 inches thick. It mentioned 34 cases, which I know, since I had to go to the Baruch College library to look them up, and email them to myself. (PS: Baruch College has a "friends of the library" plan for $500 that gives you access to their PCs for Lexis/Nexis among other databases.)

Monday, April 21, I had to prepare for my Tuesday reply to Amex's April 17 brief.

The Judge also said I should ask the lower judge (Magistrate Judge who is handling "discovery" of documents for the trial of Lindner v Amex) if I could get documents released from confidentiality so I could present them to the SEC. The Judge issued an Order that said I could on Monday, so Amex did two things:


  1. They asked that the Judge not allow me to use transcripts to the SEC which show that Amex did breach my June 2000 agreement with Amex, and that they admitted it.
  2. Amex wrote a letter (as opposed to a motion) to sanction me $7,000 for filing a frivolous motion to have Ash Gupta answer all 15 of the questions I was allowed by the Judge to ask him. Mr. Gupta, President of Banking at Amex, is Qing's direct boss. I asked him if he knew of Qing's actions in violation of the June 2000 agreement which Mr. Gupta signed, and what did he do with that knowledge. Mr. Gupta only answered 1 of the 15 questions. Amex further said I filed that motion in bad faith. Strategy: Amex wrote that as a letter instead of as a motion, so it would not appear on the record, in case I appealed to the higher court. And the Judge can ignore it. However, if he decides to agree with Amex, I could get fined $7,000, and that is surely distracting to me while I am preparing for Amex's Apr 27 shareholder meeting in North Carolina and my Apr 23 appearance before the Judge in NYC.