The court stated that "the practice of empty voting presents a challenge to shareholder democracy … when a party has a vote in a company but no economic interest in that company, that party's interests may not lie in the well-being of the company itself".
Empty voting is when a shareholder buys a substantial number of shares and simultaneously shorts the position in a roughly equivalent amount.
This anomaly has led Telus to claim that Mason is an "empty voter" — voting shares in which it has no economic interest "at the expense of other shareholders".
Telus argues that Mason will have an outsize vote different than its economic position, and that this constitutes empty voting.
They propose a menu of possible long-term solutions to what they call "empty" voting.
Telus is accusing Mason of empty voting.
But in an aside, the court heavily criticized the hedge fund for its voting strategy, calling it "empty voting".
Empty voting has been criticized because it divorces the economic interests in a share from the actual vote.
But while empty voting has spurred much hand-wringing, to date there have been few examples of the potential ill effects, or even examples of empty voting at all.
Mr. Icahn made similar charges of empty voting in the proxy battle involving Mylan's acquisition of King Pharmaceuticals and actually brought litigation against the hedge fund Perry Capital.
