In a decision issued on March 13, 2008, the Delaware Chancery Court in JANA Master Fund, Ltd. v. CNET Networks, Inc., No. 3447-CC (2008 Del. Ch. LEXIS 35), held that the advance notice provision in the bylaws of CNET Networks, Inc. (“CNET”) applied only to stockholder proposals that

are sought to be included in the company’s proxy materials pursuant to Rule 14a-8 under the Securities and Exchange Act of 1934 and therefore did not apply to independently financed stockholder proxy solicitations.

The case is significant because it provides a narrow interpretation of an advance notice bylaw provision. Such provisions are common tools used by public companies to provide an orderly, balanced process should an insurgent stockholder propose to nominate competing slates of

directors or seek to conduct other business at a stockholder meeting. By construing the CNET bylaw as only applicable to stockholder proposals submitted pursuant to Rule 14a-8, the JANA decision limited the scope of the provision by placing no limitation on stockholder proposals made by independent proxy solicitation or on the floor at the annual meeting.

The case has been appealed and is scheduled to be argued before the Delaware Supreme Court on April 16, 2008. It is reasonable to expect a decision shortly thereafter. Unless the Delaware Supreme Court reverses the decision of the Chancery Court or affirms on different grounds, Delaware corporations should review their advance notice bylaws with legal counsel and consider revising such bylaws to make clear that the requirement for advance notice of stockholder proposals applies to all proposals, whether or not submitted pursuant to the SEC proxy rules.