receptive than his CFO and the two sides are still talking. But Einhorn decided to file suit anyway because of the approaching annual meeting.
"The lawsuit is just to get the proxy sorted out," he said.
LONG ON APPLE
Einhorn began investing in Apple in 2010 and holds 1.3 million shares worth about $600 million at current values.
He emerged as a prominent advocate for the stock after it began to fall last year following some disappointing quarterly results, stiffer competition in the smartphone market, and product snafus that fueled fears Apple had lost its innovative edge following the death of co-founder Steve Jobs.
Einhorn said in a letter to investors last month that Greenlight had taken advantage of the drop in Apple's shares to buy more stock in the fourth quarter. That was one reason the fund posted a negative return of 4.9 percent in the quarter.
Since May last year, Einhorn has been urging the company to unlock several hundred billion dollars of shareholder value by distributing preferred stock, which he favored over a share buyback because it did not deplete cash immediately.
In private conversations with Oppenheimer, Einhorn said Apple could initially distribute $50 billion of perpetual preferred stock with a 4 percent annual cash dividend paid quarterly at preferential tax rates.
But, according to Einhorn, Oppenheimer and his advisers calculated the dividend to be 8 percent, which they deemed too high.
"We said, that's crazy. That's crazy. We think 4 percent. If we're wrong, maybe it's 4.5 percent or 4-1/4 percent - it is not 8 percent. So, we kind of agreed to disagree. We kind of sat on it for a few months," Einhorn said.
When he eventually took the matter to Cook, Einhorn said he felt that the CEO did not know all the details of Einhorn's discussions with Oppenheimer.
"When I discussed this with Tim Cook, and actually, the conversation has been going on for the last couple of weeks, he said that he wasn't familiar with my previous conversations with Peter Oppenheimer and whoever Peter Oppenheimer's advisers were. I was surprised by that.
"I think we got the brush-off the first time," Einhorn said