Proxy access drive drops JPMorgan, Bear as targets

By Rachelle Younglai

WASHINGTON (Reuters) - JPMorgan Chase & Co's (JPM.N: Quote, Profile, Research, Stock Buzz) looming takeover of Bear Stearns Cos Inc BSC.N has left some big shareholder groups looking for new targets in their fight for a say in the makeup of corporate boards at this year's annual meetings.

The American Federation of State, County and Municipal Employees (AFSCME) and other public pension funds filed shareholder proposals late last year with Bear Stearns and JPMorgan seeking to have the right to nominate directors to boards they say perform poorly.

After the U.S. Securities and Exchange Commission said it would not reprimand the firms for excluding the so-called proxy access proposal, the big shareholders began considering their legal options against the companies.

But Bear Stearns and its board of directors will soon be gone, rendering the shareholder proposal moot.

And AFSCME, which is leading the proxy access fight, said it would not litigate against JPMorgan because it views the deal as helping financial markets.

"We were prepared to hold the board of Bear accountable," said Rich Ferlauto, director of pension and benefit policy at AFSCME. "Unfortunately the SEC did not give us the tools to intervene at a timely manner."

AFSCME may have missed the boat for this year's set of annual meetings, which are mostly held in the spring, but vowed to press on.

"We are looking for other places to file in the year," Ferlauto said.