WaMu Rejects Call for Board Resignations

Washington Mutual has rejected a call by the CtW Investment Group for the resignation of two WaMu directors because they may not have won a majority of shareholder votes, excluding those cast by brokers. CtW commended the WaMu board for accepting the resignation of Mary E. Pugh, who received a bare majority (50.04%) of the votes cast, but questioned whether Charles M. Lillis and James E. Stever had actually won re-election. "The board should immediately disclose detailed election returns, and should demand the resignation of any directors who failed to win majority support, excluding broker votes," CtW said. WaMu later released preliminary results indicating that Mr. Lillis and Mr. Stever had won 59.21% and 57.68%, respectively, of the total votes cast. The company responded to CtW by noting that stock exchange rules permit brokers to vote on behalf of shareholders if the shareholders whose stock they hold do not tell them how to vote. "While there have been proposals to change this system, the SEC has not approved any rule changes," WaMu said. "All votes at the company's shareholders' meeting were validly cast and will be honored."