Albertsons Is Latest Company Targeted for Board Nomination Bylaw

A shareholder is suing Albertsons Cos. over its board nomination bylaw, adding to the wave of litigation challenging advance-notice provisions over claims they wrongfully kneecap activist investors.

The lawsuit, filed Monday, targets multiple bylaw sections covering dissident director candidates, focusing on two that take a broad view of when the shareholders behind the nominations must disclose that they’re “acting in concert” with others. The provisions “serve as an unlawful deterrent to those seeking to meaningfully participate in the nomination process,” according to the proposed class action.

The allegations echo a recurring theme in Delaware’s Chancery Court, where investor litigation is ...