Pipefitters Local No. 636 Defined Benefit Plan v. Oakley, Inc.

A shareholder in a publicly traded company sought substantial attorney fees on the equitable theory of substantial benefit for causing the company to slightly revise a 166-page proxy statement in. connection with a proposed acquisition. The shareholder initially sought to enjoin the acquisition, but dropped the lawsuit when the company made some changes to the final proxy statement. The shareholder filed this appeal after the trial court declined to award attorney fees.

We follow the decisions in Graham v. DaimlerChrysler Corp. (2004) 34 Cal.4th 553 [ 21 Cal.Rptr.3d 331 , 101 P.3d 140 ] (Graham) and Abouab v. City and County of San Francisco (2006) 141 Cal.App.4th 643 [ 46 Cal.Rptr.3d 206 ] (Abouab), and hold that the shareholder cannot claim unjust enrichment on a catalyst theory where it failed to provide presuit notification to the company. In suing first and asking for changes later, the shareholder failed to comply with an elemental equitable precept: that one who seeks equity must do equity. The attorney fee claim also fails because the shareholder failed to establish an abuse of discretion by showing that the additional language in the proxy statement had an…