(Bloomberg) -- Freshpet Inc.’s board members were sued by activist shareholder Jana Partners over claims they breached their fiduciary duty by changing the number of directors up for election and accelerating its annual shareholder meeting. 

Jana Partners, which has declared a proxy fight against the pet food maker, said in a complaint filed Thursday in Delaware Chancery Court that Freshpet directors “blatantly misused the corporate machinery to maintain their power in a clear breach of their fiduciary duties.”

Freshpet said in mid-May that Walt George, an existing director, was being appointed chair of the board to replace Charles Norris, who is retiring. That delayed an election for that seat until 2024 and also reduced the number of directors up for election this year to three from four. FreshPet also named former Conagra Brands Inc. Chief Supply Chain Officer David Biegger as a board member.

In addition, Freshpet announced that its annual shareholder meeting would be held July 25. Previous meetings were conducted in the fall.

The changes by the board were “plainly done for the primary purpose of entrenching itself in office and diminishing the influence that the company’s stockholders could exert on the board,” Jana Partners wrote in its complaint.

Jana is asking the judge for an order requiring the Freshpet directors to stand for election this year and allowing it to nominate four directors.

A representative for FreshPet referred to the company’s May 30 statement, stating that Jana has made erroneous and unfounded claims about the company’s board of directors, the composition of the board’s classes, and the date of the company’s 2023 annual meeting.

Meeting Date

The company said in a separate statement in May that it had engaged with Jana Partners “extensively’ but the activist shareholder’s “sole purpose” was to force the company into a sale. It also said that its independent board has the right skills and expertise. 

Jana Partners, which owns close to 10% of FreshPet’s shares alongside its affiliates, planned to nominate four directors to Freshpet’s board and said the company’s announcements — made while Jana managing director Scott Ostfeld was traveling internationally — were intended to catch the firm off guard.

Freshpet has said Norris is not standing for re-election because of the company’s retirement policy adopted by the board in 2021 that was publicly disclosed “years ago.” It added that Biegger’s appointment as a Class I director in the staggered board, which in effect delayed the election of that seat, is mandated by the company’s charter to divide the board into three classes “as nearly equal in size as is practicable.”

The investor said in March that a “significant board change” is required at FreshPet after the company raised $400 million in a convertible bond sale. “We are astonished that Freshpet’s board has elected to initiate a large equity-linked capital raise in a fragile market reeling from a systemic crisis in the banking system,” Jana said at the time. 

Another shareholder group led by James Panek, in a lawsuit filed on Tuesday, accused Freshpet’s corporate directors of wrongfully trying to stave off pressure from Jana by restructuring the company’s board.

Read more: FreshPet Board’s Fight With Jana Partners Leads to Investor Suit

Shares of Freshpet have fallen 10% in the past year. The shares rose 1.1% to $60.44 at 1:08 p.m. Thursday n New York trading, giving the company a market value of $2.9 billion.

The case is Jana Partners LLC v. Charles A. Norris, 2023-0581, Delaware Chancery Court.

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