Participation in the selection of directors of publicly held corporations requires expression through a proxy statement and involves costs of solicitation. Case decisions have firmly established management's right to use the corporate treasury for the proxy costs of a statement of its slate of candidates for directors, the rationale being that management and incumbent directors have a positive duty to inform the shareholders and to encourage voting. Dissident shareholder groups, on the other hand, have normally been required to bear their own proxy expenses. Recent case law has permitted successful insurgent stockholders to gain reimbursement of their proxy expenses from the corporation. These cases, as well as the uncertainty and inadequacy of their application, require examination.
Lawrence D. Stifel, Shareholder Proxy Fight Expenses, 8 Clev.-Marshall L. Rev. 339 (1959)