The hedge fund Greenlight Capital, led by David Einhorn, filed a lawsuit challenging a proxy that would limit the ability to create a special class of stock. CEO Tim Cook Tuesday called the suit "a silly sideshow" and said his engineers have not lost their innovative edge.
Speaking at a Goldman Sachs technology conference, Cook reiterated Apple's stand that it is seriously looking at whether to return more cash to shareholders as its cash stockpile grew to $137 billion as of the end of the December quarter, roughly two-thirds of which is held overseas. "Apple makes bold and ambitious bets on products and we are conservative financially," he said.
Cook called the lawsuit a "misunderstanding" and said that if Apple were ever to issue preferred stock - which Einhorn is calling for - the company would first seek shareholder approval.
Last year, the Cupertino, Calif., company announced its first quarterly dividend since 1995 - $2.65 a share beginning in August - as shareholders called on Apple to reward investors with a slice of its massive amount of cash.
Greenlight Capital's suit seeks to halt a company-sponsored proxy proposal that would eliminate "blank check" preferred stock; the proposal is scheduled to be voted on during Apple's annual shareholder meeting on Feb. 27.
The company spent $10 billion on capital expenditures last year and will likely do the same this year, Cook said.