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Sidley Austin Dominates Big Law in Successful Defense Against Activist Investor Challenges
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Sidley Austin LLP has once again taken a prominent position, successfully navigating numerous high-profile cases in the first half of 2023. Notably, the law firm played a pivotal role in a closely watched proxy contest involving biopharmaceutical company Alkermes plc.

According to recently released data from Bloomberg, Sidley Austin advised companies in a total of 32 activist campaigns during the first half of the year, surpassing their previous year’s record of 30 engagements. The collective value of shareholder stakes in Sidley’s matters amounted to an impressive $2.6 billion, reflecting the significant investments made by activist investors involved in these campaigns.

Vinson & Elkins LLP secured the second spot in the rankings with 30 engagements, totaling shareholder stakes valued at $1.2 billion. Latham & Watkins LLP followed closely in third place, with 19 engagements and total stakes amounting to an impressive $4.7 billion.


One notable achievement for Sidley Austin was their role as advisors to Alkermes in a proxy contest against Sarissa Capital. This particular contest garnered significant attention when the head of Sarissa left his position at Biogen Inc., a collaborator of Alkermes, to pursue three director seats at Alkermes. Moreover, he nominated his romantic partner to fill his vacant position at Biogen. Alkermes successfully defended against Sarissa Capital’s efforts to secure director seats during the company’s annual meeting held in late June.

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Reflecting on the proxy season, Kai Liekefett, a Sidley partner and co-chair of the firm’s shareholder activism and corporate defense practice, expressed his surprise at the lower-than-anticipated activity in the activism space. While many expected a record-breaking proxy season, the reality did not meet these expectations.

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During the first half of 2023, there were a total of 417 new activist campaigns, marking a 26% increase compared to the same period in the previous year, as reported by Bloomberg data. However, the value of activist stakes remained relatively flat at $44.5 billion.

Liekefett speculated on several factors that may have contributed to the lower levels of shareholder activism. He pointed to the impact of universal proxy card rules implemented by the Securities and Exchange Commission (SEC) in September. These rules altered the dynamics between companies and activists, often leading to more settlements and a decrease in proxy fights during annual meetings. The SEC’s new regulations require companies to list candidates supported by both shareholders and management on the same ballot for contested board elections, thereby providing proxy voters with a broader range of choices.

Liekefett also attributed the subdued proxy season to the financial volatility experienced earlier in the year. Many activists chose to exercise caution and avoid engaging in proxy fights due to the looming possibility of a recession.

In addition to their involvement with Alkermes, Sidley Austin also provided legal counsel to pet food company Freshpet Inc. in their defense against Jana Partners, who nominated four directors to the company’s board. Jana subsequently filed a lawsuit against Freshpet and the board of directors in the Delaware Chancery Court after the company rescheduled its annual meeting from the fall to July. However, Freshpet eventually moved the meeting back to its original date in the fall. Jana Partners also accused the company of attempting to reduce the number of directors up for election, an allegation firmly denied by Freshpet.

Sidley Austin’s expertise in activist investor defense was further demonstrated in their involvement with department store chain Nordstrom Inc. In this case, activist investor Ryan Cohen, chairman of GameStop Corp and founder of Chewy Inc., nominated two board candidates. However, Cohen later withdrew the nominations.

As the first half of 2023 draws to a close, Sidley Austin LLP has once again proven their prowess in navigating the complex and evolving landscape of shareholder activism. With a remarkable track record and expertise in handling high-stakes proxy contests, the law firm has solidified its position as a go-to choice for companies seeking effective defense against activist investors.

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