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CWA Sues AT&T to Protect Shareholder Rights
CWA, the AFL-CIO and the Amalgamated Bank, which together hold $30 million of AT&T stock, have filed a lawsuit in the Supreme Court of New York to stop AT&T from attempting “an end run around shareholders.”
The lawsuit charges that AT&T is trying to adopt an illegal process to amend its charter so that only a simple majority of shareholder votes, not the now-required two-thirds, can authorize the major restructuring the company is planning. In its preliminary proxy statement, AT&T has proposed an amendment for shareholders to consider at its May 23 annual meeting, one that would eliminate the requirement for a two-thirds shareholder vote by substituting a simple majority vote.
“AT&T management is proposing a radical restructuring that represents a total reversal in its business strategy,” CWA President Morton Bahr said. “AT&T should seek broad shareholder consensus, not ask shareholders to relinquish their rights before AT&T fully discloses the terms of the breakup.”
Management wants to split AT&T into three companies with four separate stock listings — broadband, wireless, business and consumer operations. This would move AT&T even farther from a bundled telecommunications services strategy while its major competitors are all offering the integrated services customers want, CWA said.
The lawsuit is a part of CWA’s campaign to persuade AT&T that the business strategy the company is pursuing will harm workers, consumers and investors, all of whom have a huge stake in the future of AT&T.
Over the next few weeks, leading up to the May 23 AT&T meeting in Cincinnati, CWA activists will be taking this message to shareholders who are voting on AT&T’s amendment to change the shareholder approval process.
Activities include phone banking of shareholders; continued contacts and meetings with major institutional investors and analysts, many of whom share CWA’s concerns about the breakup plan; and informational picketing, both at AT&T sites and at appearances by members of the AT&T board of directors.
In Orlando, members of CWA Local 3108 leafleted outside AT&T’s payroll office when top company officials were meeting, to protest the proposed restructuring and AT&T’s attempt to transfer some jobs to the non-union Media One operation. Similar actions will be held at AT&T locations nationwide.
As part of the union’s ongoing review of AT&T’s flawed business plan, CWA conducted a preliminary survey of a dozen AT&T Broadband cable television franchises. The review found significant violations of the Federal Communications Commission’s public disclosure rules, prompting CWA to call for a full FCC audit of AT&T Broadband franchises.
At a number of locations, AT&T management refused public access to records, did not make files available to the public, or maintained incomplete and out-of-date information.
Especially troubling is the failure of AT&T franchises to maintain complete signal leakage logs and proof-of-performance records that would demonstrate whether the company is meeting the FCC’s technical standards, CWA told the FCC.
The lawsuit charges that AT&T is trying to adopt an illegal process to amend its charter so that only a simple majority of shareholder votes, not the now-required two-thirds, can authorize the major restructuring the company is planning. In its preliminary proxy statement, AT&T has proposed an amendment for shareholders to consider at its May 23 annual meeting, one that would eliminate the requirement for a two-thirds shareholder vote by substituting a simple majority vote.
“AT&T management is proposing a radical restructuring that represents a total reversal in its business strategy,” CWA President Morton Bahr said. “AT&T should seek broad shareholder consensus, not ask shareholders to relinquish their rights before AT&T fully discloses the terms of the breakup.”
Management wants to split AT&T into three companies with four separate stock listings — broadband, wireless, business and consumer operations. This would move AT&T even farther from a bundled telecommunications services strategy while its major competitors are all offering the integrated services customers want, CWA said.
The lawsuit is a part of CWA’s campaign to persuade AT&T that the business strategy the company is pursuing will harm workers, consumers and investors, all of whom have a huge stake in the future of AT&T.
Over the next few weeks, leading up to the May 23 AT&T meeting in Cincinnati, CWA activists will be taking this message to shareholders who are voting on AT&T’s amendment to change the shareholder approval process.
Activities include phone banking of shareholders; continued contacts and meetings with major institutional investors and analysts, many of whom share CWA’s concerns about the breakup plan; and informational picketing, both at AT&T sites and at appearances by members of the AT&T board of directors.
In Orlando, members of CWA Local 3108 leafleted outside AT&T’s payroll office when top company officials were meeting, to protest the proposed restructuring and AT&T’s attempt to transfer some jobs to the non-union Media One operation. Similar actions will be held at AT&T locations nationwide.
As part of the union’s ongoing review of AT&T’s flawed business plan, CWA conducted a preliminary survey of a dozen AT&T Broadband cable television franchises. The review found significant violations of the Federal Communications Commission’s public disclosure rules, prompting CWA to call for a full FCC audit of AT&T Broadband franchises.
At a number of locations, AT&T management refused public access to records, did not make files available to the public, or maintained incomplete and out-of-date information.
Especially troubling is the failure of AT&T franchises to maintain complete signal leakage logs and proof-of-performance records that would demonstrate whether the company is meeting the FCC’s technical standards, CWA told the FCC.