United Airlines Poison Pill Hit With Shareholder Challenge

An investor sued United Airlines Holdings Inc. and its board members Wednesday, saying the airline’s corporate poison pill is an illegal anti-takeover tactic disguised as an effort to preserve valuable tax assets.

The lawsuit, filed in Delaware, seeks to block an investor vote on a proposal to renew United’s “shareholder rights plan,” which works by triggering a major stock dilution event if any stockholder or consortium acquires a 4.9% stake. The complaint zeroes in on a daisy-chain clause taking an aggressive view of when investors count as a group based on an “agreement, arrangement, or understanding” among them.

The allegations ...