Delaware Justices Rule Bylaw Disputes Unripe Absent Proxy Fight

Stockholder challenges to advance notice bylaws are premature without an actual proxy contest, the Delaware Supreme Court ruled Wednesday, upholding dismissals of lawsuits against AES Corp. and Owens Corning.

Stockholders of AES, an electric power distributor, and Owens Corning, which produces building materials, argued the companies’ advance notice bylaws were improperly adopted to deter shareholders from exercising their rights to submit proposals or nominate board candidates. The Delaware Chancery Court dismissed both cases last year, finding the claims unripe without an active proxy fight.

The case presented “remains abstract,” Justice Abigail M. LeGrow wrote in a 30-page opinion for ...