Proxy Fight Updates

1. The New York Times has settled its dispute with hedge funds Harbinger and Firebrand.

The Times agreed Monday to expand its board of directors by two seats and appoint to those seats Scott Galloway and James Kohlberg. These are two of the nominees who had been on the dissident slate.

This resolution shows either (a) that even the Times with its dual stock structure isn't immune from outside pressures, or (b) that the Times has cleverly fending off a challenge by giving up seats that will prove meaningless, proving that it remains effectively immune to outside pressure.

Your call.

2. CSX files lawsuit.

As regular readers of Proxy Partisans know, the railroad corporation CSX faces a proxy challenge from the London-based hedge fund TCI which contends that the company should: separate the roles of chairman of the board and chief executive; refresh the Board with new independent directors; allow shareholders to call special shareholder meetings; align management compensation with shareholder interests; justify its capital spending plan to shareholders; and provide to shareholders a plan to improve operations.

On Monday, CSX filed a lawsuit in the federal court in Manhattan, where TCI's US operations are based. The allegations are fairly complicated, but the main point of the lawsuit involves federal laws that require that shareholders who own more than a threshold amount of the equity of a company to disclose this fact as they pass the threshold. The idea is to prevent an ambush -- to bring takeover contests and such out into the open.

CSX claims that TCI has played games to hide how much of CSX it owns, violating the threshold rules in fact while pretending to abide by them in name. TCI denies having done anything wrong.

3. Begelman, former Office Depot president, aims for a director's position.

Mark Begelman was president of Office Depot in the early 1990s. Martin Hanaka knows the office-supply business too. Hanaka is the former president of Staples. They are both now nominees for the Office Depot board, their names put forward by disaffected investors who want to fire Steve Odland, present CEO.

The company's annual meeting is scheduled for April 23. March 3 is the record date.

That's it for this week. We'll meet again Sunday, proxy-fight fans!