Company Name: Boeing Co.
Public Availability Date: February 5, 2008
Document Sections: INQUIRY LETTER
INQUIRY LETTER
INQUIRY LETTER
APPENDIX 1
APPENDIX 2
STAFF REPLY LETTER
[INQUIRY LETTER]
December 21, 2007
VIA OVERNIGHT COURIER
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Chief Counsel
100 F Street N.E.
Washington, D.C. 20549
Re: Shareholder Proposal Concerning Health Care Reform Submitted by the AFL-CIO
Reserve Fund for Inclusion in The Boeing Company 2008 Proxy Statement
Dear Sir or Madam:
On November 21, 2007, The Boeing Company, a Delaware corporation ("Boeing" or
the "Company"), received a proposed shareholder resolution and supporting
statement (together, the "Proposal") from the AFL-CIO Reserve Fund (the
"Proponent") for inclusion in the proxy statement to be distributed to the
Company's stockholders in connection with its 2008 Annual Meeting (the "2008
Proxy Statement").
We hereby request that the staff of the Division of Corporation Finance (the
"Staff") confirm that it will not recommend any enforcement action to the
Securities and Exchange Commission (the "Commission") if, in reliance on certain
provisions of Commission Rule ("Rule") 14a-8 under the Securities Exchange Act
of 1934, as amended, Boeing excludes the Proposal from the 2008 Proxy Statement
and form of proxy (the "2008 Proxy Materials").
In accordance with Rule 14a-8(j), we hereby file six copies of this letter and
the Proposal, which is attached to this letter as Exhibit A. The Company
presently intends to file its definitive 2008 Proxy Materials on March 14, 2008,
or as soon as possible thereafter. Accordingly, pursuant to Rule 14a-8(j), this
letter is being submitted not less than 80 calendar days before the Company will
file its definitive 2008 Proxy Statement with the Commission.
Also, in accordance with Rule 14a-8(j), we are simultaneously forwarding a copy
of this letter via overnight courier, with copies of all enclosures, to the
Proponent as notice to the Proponent of the Company's intention to exclude the
Proposal from the 2008 Proxy Materials. Please fax any response by the Staff to
this letter to my attention at (312) 544-2829. We hereby agree to promptly
forward to the Proponent any Staff response to this no-action request that the
Staff transmits to us by facsimile. A copy of additional correspondence with the
Proponent relating to the Proposal, since the date the Proposal was submitted to
the Company, is attached to this letter as Exhibit B.
The Proposal
The Proposal relates to health care reform and states, in relevant part:
RESOLVED: Shareholders of The Boeing Company (the "Company") urge the Board of
Directors (the "Board") to adopt principles for health care reform based upon
principles reported by the Institute of Medicine:
1. Health care coverage should be universal.
2. Health care coverage should be continuous.
3. Health care coverage should be affordable to individuals and families.
4. The health insurance strategy should be affordable and sustainable for
society.
5. Health insurance should enhance health and well being by promoting access to
high-quality care that is effective, efficient, safe, timely, patient-centered,
and equitable.
In addition to asking the Company's Board of Directors (the "Board") to adopt
the health care reform principles outlined above, the supporting statement of
the Proposal describes the Proponent's views on the necessity of health care
reform and the economic challenge that rising health care costs represent to
U.S. corporations, including the Company.
Summary of Basis for Exclusion
We believe that Boeing may properly exclude the Proposal from the 2008 Proxy
Materials pursuant to Rule 14a-8(i)(7) as relating to the conduct of the
Company's ordinary business operations because the Proposal addresses the
Company's ordinary business matters (health care benefits for a corporation's
employee population) and attempts to involve the Company in the political or
legislative process relating to those matters.
Analysis
The Proposal May Be Omitted Under Rule 14a-8(i)(7) as Relating to the Conduct of
the Company's Ordinary Business Operations.
A. The Proposal Addresses Ordinary Business Matters
Rule 14a-8(i)(7) under the Exchange Act provides a basis for the exclusion of
proposals that seek to submit ordinary business matters to shareholders.1 In
describing the policy considerations underlying the Rule 14a-8(i)(7) ordinary
business exclusion, the Commission notes that "[c]ertain tasks are so
fundamental to management's ability to run a company on a day-to-day basis that
they could not, as a practical matter, be subject to direct shareholder
oversight." However, proposals relating to such matters but focusing on
sufficiently significant social policy issues generally would not be considered
to be excludable, because the proposals would "transcend the day-to-day business
matters" and raise policy issues so significant that they would be appropriate
for a shareholder vote.2
The Staff has consistently deemed proposals that deal with health care benefits,
and specifically rising health care and health insurance costs, as relating to
ordinary business operations and therefore excludable under Rule 14a-8(i)(7).
See, e.g., General Motors Corp., SEC No-Action Letter, 2007 WL 1175902 (Apr. 11,
2007) (requesting that the board prepare a report examining the implications of
rising health care expenses and how the company is addressing the issue without
compromising the health and productivity of its workforce) (the "2007 GE
Letter"); Kohl's Corp., SEC No-Action Letter, 2007 WL 80456 (Jan. 8, 2007)
(same); General Motors Corp., SEC No-Action Letter, 2005 WL 704112 (Mar. 24,
2005) (requesting that the board establish a committee to develop specific
reforms for "the health cost problem"); International Business Machines Corp.,
SEC No-Action Letter, 2005 WL 129947 (Jan. 13, 2005) (requesting a board report
on the competitive impact of rising health insurance costs). Even a proposal
that deals with health care costs in a broader context, requiring the company to
provide information about health costs and support the establishment of a
national health insurance system, has been treated as ordinary business and
therefore excludable. International Business Machines Corp., SEC No-Action
Letter, 2002 WL 188383 (Jan. 21, 2002) (the "2002 IBM Letter").
The Proposal requests that the Board adopt principles of health care reform, and
much of the Proposal's supporting statement concerns the consequences to the
Company of rising health care costs. Health care costs are a significant expense
for the Company, and managing health care costs for Boeing employees and
retirees and their dependents is a key factor in Boeing's business operations.
These health care costs are closely related to the "mundane, day-to-day
operations" of the Company. 2007 GE Letter. As a result, a proposal dealing with
health care expenses is related to the Company's ordinary business and may be
excluded under Rule 14a-8(i)(7).
When assessing proposals under Rule 14a-8(i)(7), the Staff considers both the
resolution and the supporting statement as a whole. See, e.g., Staff Legal
Bulletin No. 14C, part D.2. (June 28, 2005) ("In determining whether the focus
of these proposals is a significant social policy issue, we consider both the
proposal and the supporting statement as a whole.") As a result, regardless of
whether the "resolved" clause in a proposal implicates ordinary business
matters, the proposal is excludable when the supporting statement has the effect
of transforming the vote on the proposal into a vote on an ordinary business
matter. Although framed broadly as asking the Company to adopt certain
principles for health care reform, the Proposal's supporting statement
highlights the consequences of rising health care costs to the Company, which
seems to be the main impetus for submitting the Proposal. For example, the
supporting statement states that the health care principles the Proposal
advocates "are essential if public confidence in our Company's commitment to
health care coverage is to be maintained." The supporting statement further
notes that "[o]ur Company currently has Other Postretirement Benefit [sic]
(which includes health care benefits) liability of more than $8 billion,
according to its 10-K. We believe that the 47 million Americans without health
insurance results in higher costs to our Company... . Moreover, we feel that
increasing health care costs further reduce shareholder value when it leads
companies to shift costs to employees, thereby reducing employee productivity,
health and morale." Accordingly, we believe the Proposal and its supporting
statement taken as a whole implicate the ordinary business operations of the
Company.
Moreover, the Staff has not deemed the national health care reform debate to
involve the type of significant social policy issue that would take proposals
relating to health care reform out of the ordinary business exclusion. See,
e.g., Pepsico, Inc., SEC No-Action Letter, 1991 WL 178559 (Mar. 7, 1991)
(proposal calling for the establishment of a "committee of the board consisting
of outside and independent directors for the purpose of evaluating the impact of
a representative cross section of the various health care reform proposals being
considered by national policy makers on the company" could be excluded from
their proxy materials as ordinary business under former Rule 14a-8(c)(7)). See
also Albertson's, Inc., SEC No-Action Letter, 1992 WL 57576 (Mar. 19, 1992) and
Albertson's, Inc., SEC No-Action Letter, 1992 WL 55854 (Mar. 19, 1992) (separate
decisions of the Commission declining to review the Staff's letter dated
February 10, 1992, excluding shareholder proposals from NYCERS and UBC General
Officers' Pension Fund, respectively, relating to national health care reform on
ordinary business grounds); Minnesota Mining and Manufacturing Co., SEC
No-Action Letter, 1991 WL 176604 (Feb. 6, 1991) (proposal to have the company's
board prepare a special report including "an evaluation of the impact of a
representative cross section of the various health care reform proposals being
considered by national policy makers on the company" properly excluded by the
Staff as part of company's ordinary business operations); Knight-Ridder, Inc.,
SEC No-Action Letter, 1991 WL 176516 (Jan. 23, 1991) (same); Albertsons, Inc.,
SEC No-Action Letter, 1991 WL 176507 (Jan. 22, 1991) (same). The same result
should apply here in the context of the ongoing health care reform debate.
As a provider of health care benefits, Boeing is active in monitoring and
attempting to reduce the costs of health care. Whether viewed as a matter of
employee benefits or as a significant expense in the Company's operations,
monitoring health care costs is a routine part of the Company's business. The
Proposal, concerning health care costs, should be treated as relating to the
Company's ordinary business of providing employee benefits and therefore
excludable under Rule 14a-8(i)(7).
B. The Proposal Involves Ordinary Business Matters Because It Attempts to
Involve the Company in the Political or Legislative Process Relating to the
Company's Business Operations.
Health care reform is at the center of national and state political debate and
legislative initiatives.3 The Proposal requests that the Company adopt one set
of principles of health care reform, thereby seeking to involve the Company in
the political or legislative process on an issue relating to the Company's
ordinary business operations (the provision of health care benefits to its
employees). In a number of no-action letters, the Staff has concurred that
similar proposals are excludable under Rule 14a-8(i)(7). For example, in the
2002 IBM Letter, the Staff concurred in the exclusion of a proposal that, like
the Proposal here, asked the company to join the political debate on health care
reform. The proposal at issue in the 2002 IBM Letter asked the company to "[j]oin
with other corporations in support of the establishment of a properly financed
national health insurance system." The Staff concurred that the proposal was
excludable because it "appears directed at involving IBM in the political or
legislative process relating to an aspect of IBM's operations." The Staff
reached the same result in the following letters: Chrysler Corp., SEC No-Action
Letter, 1992 WL 25332 (Feb. 10, 1992) (proposal that the registrant "actively
support and lobby for universal health coverage"); Dole Food Co., SEC No-Action
Letter, 1992 WL 30692 (Feb. 10, 1992), Commission review denied (Mar. 19, 1992)
(proposal seeking to establish committee of the board "for the purpose of
evaluating the impact of a representative cross section of the various health
care reform proposals being considered by national policy makers on the
company"); GTE Corp., SEC No-Action Letter, 1992 WL 32325 (Feb. 10, 1992)
(proposal requesting the preparation of a report by a committee of the board to
evaluate various health care proposals being considered by national policy
makers); Brunswick Corp., SEC No-Action Letter, 1992 WL 30687 (Feb. 10, 1992)
(proposal requesting the registrant to establish a committee of the board to
prepare a report (i) comparing health standards, methods of administration,
costs and financing of health care plans in all countries where the company does
business, and (ii) describing any aspects of governmental policy affecting those
plans which should be included in the development of a national health insurance
plan in the United States).4
The instant Proposal seeks the same end: adopting principles of health care
reform is substantively indistinguishable from the actions requested by the
proposals in the 2002 IBM Letter and the other letters cited above. Those
proposals were all excluded because they sought to involve the company in
question in the political process surrounding health care reform. The same
result should apply here under Rule 14a-8(i)(7).
The determination of the Company's position on health care reform falls squarely
within the Company's ordinary business operations. Boeing employs a team of
professionals whose routine duties include the ongoing assessments of various
existing health care programs and determining the Company's position, if any, on
health care reform. Based on the authority noted above, the Proposal is
excludable as it deals with the Company's ordinary business operations (i.e.,
the provision of health care benefits to its employees) and seeks to involve the
Company in the political and legislative process relating to those ordinary
business operations.
* * * * *
For the foregoing reasons, we believe the Proposal may be omitted from the 2008
Proxy Materials and respectfully request that the Staff confirm that it will not
recommend any enforcement action if the Proposal is excluded.
Should you have any questions regarding any aspect of this matter or require any
additional information, please call me at (312) 544-2802. Please acknowledge
receipt of this letter and its enclosures by stamping the enclosed copy of this
letter and returning it to me in the enclosed envelope.
Very truly yours,
/s/
Michael F. Lohr
Corporate Secretary
enclosures
cc: AFL-CIO Reserve Fund
-----FOOTNOTES-----
1 See 17 C.F.R. 240.14a-8(i)(7) (permitting a company to exclude a proposal
that "deals with a matter relating to the company's ordinary business
operations").
2 See Exchange Act Release No. 34-40018 (May 18, 2001).
3 For example, Massachusetts and Vermont passed health care reform laws in 2006.
Differing health care reform bills are pending in several states, including
California, Hawaii, Illinois, Kansas, Minnesota, North Carolina and
Pennsylvania. "Health Reform Bills" page of the National Conference of State
Legislatures website, http://www.ncsl.org/programs/health/universalhealth2007.htm,
(accessed on Dec. 18, 2007). As the Proponent notes, health care reform is at
the center of a national political discussion, including the 2008 presidential
election. See Catherine Arnst, The Politics of Health Care Reform, BusinessWeek
(September 17, 2007). On the legislative side, several health care reform bills
have been introduced into the U.S. Congress, and President Bush recently vetoed
a bill that would reauthorize the State Children's Health Insurance Program (SCHIP)
(a state-federal partnership to bridge the safety net gap for low-income
children who are ineligible for Medicaid but still lack private health
insurance). See the "National legislative activities" page of the American
Medical Association website, http://www.ama-assn.org/ama/pub/category/5913.html
(accessed on Dec. 18, 2007).
4 It is notable that the New York City Employees' Retirement System (NYCERS),
the stockholder proponent in both Brunswick and Dole, challenged the
Commission's determinations that its proposals could be excluded as ordinary
business, moving in each instance for a preliminary injunction in separate
actions in the U.S. District Court for the Southern District of New York. These
attempts were ultimately unsuccessful. For a detailed summary of the procedural
history of these challenges, see the 2002 IBM Letter.
[INQUIRY LETTER]
January 18, 2008
Office of Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Re: The Boeing Company's Request to Exclude Proposal Submitted by the AFL-CIO
Reserve Fund
Dear Sir/Madam:
This letter is submitted in response to the claim of the Boeing Company
("Boeing" or the "Company"), by letters dated December 21, 2008, and January 18,
2008, that it may exclude the shareholder proposal ("Proposal") of the AFL-CIO
Reserve Fund ("Fund" or the "Proponent") from its 2008 proxy materials.
I. Introduction
Proponent's shareholder proposal to Boeing urges:
the Board of Directors to adopt principles for health care reform based upon
principles reported by the Institute of Medicine:
1. Health care coverage should be universal.
2. Health care coverage should be continuous.
3. Health care coverage should be affordable to individuals and families.
4. The health insurance strategy should be affordable and sustainable for
society.
5. Health insurance should enhance health and well being by promoting access to
high quality care that is effective, efficient, safe, timely, patient-centered,
and equitable.
Boeing argues that the Proposal is excludable because it:
"addresses ordinary business matters" and "attempts to involve the Company in
the political or legislative process" [Rule 14a-8(i)(7)];
"is vague and indefinite and the Company cannot determine how to implement the
Proposal's objectives." [Rule 14a-8(i)(3) and Rule 14a-8(i)(6)].
The Company asserts that since health care is "a key factor in Boeing's business
operations," any proposal dealing with health care reform is therefore
excludable as ordinary business under Rule 14a-8(i)(7). If this were so, then
SEC Staff decisions on health care reform and human and labor rights would have
uniformly permitted companies to exclude proposals on these significant social
policy issues. As outlined in detail below, Staff decisions do not support
Boeing's argument. In addition, the Company now argues that the Proposal may be
excluded because it is vague and indefinite and may be excluded under Rule
14a-8(i)(3). A careful reading of the Proposal, however, demonstrates that its
terms are clear and that it urges the Board of Directors to adopt Boeing's own
principles on a significant social policy issuehealth care reformjust as other
proposals have done on another significant public issue: labor and human rights.
In sum, the Proposal carefully focuses on a significant social policy issue and
it belongs on the Boeing proxy for 2008.
II. The Proposal is not excludable under Rule
14a-8(i)(7), as an ordinary business matter because it focuses on a significant
social policy issue that transcends the day-to-day business matters of the
Company.
A. Health care reform is a significant social policy issue.
The Commission stated in Exchange Act Release No. 40018 that "proposals that
relate to ordinary business matters but that focus on "sufficiently significant
social policy issues ... would not be excludable, because the proposals would
transcend day-to-day business matters... ." The Proposal before Boeing is just
such a proposal. It urges the Board of Directors to adopt principles for health
care reform based upon principles reported by the nation's leading authority on
health care issues, the Institute of Medicine. The Proposal does not ask the
Company to provide any information or reports on its internal operations.
Instead, it asks the Company to focus externally on health care reform as a
significant social policy issue affecting the Company and the public's health.
Health care reform is, in fact, the most important domestic issue in America.
Public opinion polls by The Wall Street Journal/NBC News, the Kaiser Foundation,
the Associated Press,1 the Commonwealth Fund2 and The New York Times all
document its significance. The November 2007 Wall Street Journal/NBC News poll,
for example, reported 52% of Americans "say the economy and health care are most
important to them in choosing a president, compared with 34% who cite terrorism
and social and moral issues ... . That is the reverse of the percentages
recorded just before the 2004 election. The poll also shows that voters see
health care eclipsing the Iraq war for the first time as the issue most urgently
requiring a new approach." 3
Many businesses now cite health care costs as their biggest economic challenge.
Indeed, Boeing is a member of the Business Roundtable, whose president, John
Castellani, has called health care reform a top priority for business and
Congressional action. "4 In September, the CEOs of Kelly Services and Pitney
Bowes, Inc, together with GE's Global Health Director, called on Congress to
enact health care reform.5 They joined other leading business coalitions,
including the National Coalition on Health Care and the National Business Group
on Health. The latter's membership consists of 245 major companies, including 60
of the Fortune 100.6 Each organization maintains that the cost of health care
for business is now greater than it should be and will continue to rise as long
as 47 million Americans who have no health insurance remain without coverage.
Other leading business organizations have recently announced their support for
health care reform: Divided We Fail, a coalition of the AARP, the Business
Roundtable, the Service Employees International Union (SEIU) and the National
Federation of Independent Business, states that it will "make access to quality,
affordable health care and long-term financial security top issues in the
national political debate." 7 In addition, Wal-Mart has joined with SEIU,
calling on Congress to enact health care reform.8
Underscoring the significance of health care reform as a major social policy
issue in 2007, the American Cancer Society has taken the unprecedented step of
redirecting its entire $15 million advertising budget "to the consequences of
inadequate health care coverage" in the United States.9
B. The Proposal focuses on principles for health care reform as a significant
social policy issue, not as a matter of internal risk assessment.
Proponent's Proposal urges the Company to adopt a statement of principles for
health care reform. It neither asks for a report on this significant social
policy issue, nor does it require any assessment of internal matters of risk
affecting the Company. The Proposal, in fact, is more akin to proposals that
have called upon companies to adopt a code of conduct dealing with human rights.
Such codes are statements of principles that guide a company in dealing with the
significant social policy issue of human rights. The Staff has decided that such
proposals are not excludable as matters relating to ordinary business operations
under Rule 14a-8(i)(7). In both McDonald's Corporation, 2007 SEC No-Act. LEXIS
378 (March 22, 2007), and Costco Wholesale Corporation, 2004 SEC No-Act. LEXIS
806 (October 26, 2004), companies cited "ordinary business operations," to
exclude proposals calling for the adoption of a company code of conduct. The
Staff denied each company's request.
Boeing narrowly characterizes the Proposal here as one concerned with
"consequences to the Company." But the plain language of the Proposal and the
Supporting Statement describe "health care reform" in the context of a
significant social policy affecting the Company and the nation. The Proposal
describes "universal" coverage of all Americans and repeatedly speaks in terms
of businesses in the U.S. and the global economy. It cites research from one of
the nation's leading health economists, Dr. Kenneth Thorpe, that shows companies
pay as much as $1,160 in surcharges for each insured employee to cover the costs
of medical care delivered to the 47 million Americans who are uninsured.10 The
Supporting Statement also describes Dr. Thorpe's finding that universal health
insurance coverage would save employers presently providing health insurance an
estimated $595-$848 billion in the first 10 years of implementation.11
Just as the human rights proposals in McDonald's Corporation and Costco
Wholesale Corporation involved companies in the U.S. and the global economy and
the significant social policy issue of human rights, the Proposal here focuses
on the Company in the U.S. and the global economy and health care as a
significant social policy issue.
C. While proposals calling for reports on health care have generally been
excluded as matters involving an analysis of internal risk, Proponent's Proposal
calls for an entirely different measure: the adoption of principles for health
care reformon a matter of significant social policy.
The Company cites International Business Machines Corporation, 2002 SEC No-Act.
LEXIS 85 (January 21, 2002), in support of its request to exclude the Proposal.
Proponent did, in fact, submit an identical proposal to IBM for inclusion in
that company's 2008 proxy. Unlike Boeing, however, IBM chose not to file a
No-Action Letter with the Commission. Instead, IBM began a dialogue with the
Proponent. IBM and the Proponent reached an agreement on the text of a letter
that IBM sent to the Proponent (Attachment "A"), describing its principles for
health care reform.12 Bristol-Meyers Squibb ("Bristol-Meyers") received a nearly
identical proposal to Proponent's, calling for the adoption of principles for
health care reform. After a dialogue with proponents of the resolution,
Bristol-Meyers withdrew its request to the Commission for a No-Action Letter to
exclude the Proposal, citing Rule 14a-8(i)(7).13 Bristol-Meyers has now posted
its statement of principles for health care reform on its website.14
In Ford Motor Company, 2007 SEC No-Act. LEXIS 296 (March 1, 2007), the Staff
agreed that a proposal requesting that the board prepare a report "examining the
implications of rising health care expenses and how Ford is addressing this
issue without compromising the health and productivity of its workforce" could
not be excluded as ordinary business under Rule 14a-8(i)(7). The proposal
requested a report focused exclusively on health care costs as a significant
social policy issue. Both the proposal and the supporting statement contained
extensive documentation on health care costs. Both carefully framed the issue as
one that in no way involved reporting on the internal risks posed to Ford's
ordinary business, including its employee benefits operations.
The Company, however, cites Staff decisions on proposals that centered on
matters of internal risk assessment and company finances relating to employee
benefits plans. General Motors Corporation, 2007 SEC No-Act. LEXIS 446 (April
11, 2007), involved what GM described as "a significant expense for General
Motors, and managing health care costs for GM employees and retirees and their
dependents is a key factor in GM's business operations." Id.; Kohl's
Corporation, 2007 SEC No-Act. LEXIS 5 (January 8, 2007), involved the same
proposal, calling for a report on health care costs at each company. Unlike the
Proponent's Proposal, which calls for the adoption of principles on a
significant social policy issue, the health care reports called for by the
proposals in General Motors Corporation and Kohl's Corporation would have
required each company to conduct internal risk assessments.
General Motors Corporation, 2005 SEC No-Act. LEXIS 462 (March 24, 2005), is
inapposite. Unlike the Proposal before Boeing, which calls upon the Board of
Directors to adopt principles for health care reform on a matter of significant
social policy issue, the proposal before GM, called for the board to develop
"specific reforms for the health care cost problem," a matter that GM explained
was an integral part of its routine management of the company.
International Business Machines Corporation, 2002 SEC No-Act. LEXIS 85 (January
21, 2002), also cited by the Company, involved a proposal that called upon IBM
to "share with its stockholders the estimated average annual cost for employee
health benefits in the United States versus the next five countries with the
largest number of IBM employees" and commence a lobbying campaign for national
health insurance. Proponent's Proposal contains nothing that would require the
sharing of health benefits costs information with shareholders. Nor is there any
request to the Company to commence a lobbying campaign for national health
insurance. Instead, the Proposal asks the Company to adopt a statement of
principles for health care reform. While the Proposal does state Proponent's
opinion that health care reform is a significant issue in the presidential
campaign of 2008, it merely requests the Board to adopt principles for health
care reform. It contains no request for other action. It is entirely up to the
Company's Board of Directors and management to take any actions they may deem
necessary on health care reform or, for that matter, on any other matter
relating to its internal operations with respect to health care benefits.
1. The Proposals' Supporting Statement focuses on health care reform as a
significant social policy issue.
Boeing mischaracterizes the Supporting Statement of the Proposal as a matter of
ordinary business, claiming that it "highlights the consequences of rising costs
to the Company, which seems to be the main impetus for submitting the Proposal."
The Company cites Staff Legal Bulletin No. 14C, Part D.2 (June 28, 2005), for
the proposition that the Proposal is excludable "when the supporting statement
has the effect of transforming the vote on the proposal into a vote on an
ordinary business matter."
Staff Legal Bulletin No. 14C contains the following test, which bears no
relation to the Company's argument:
To the extent that a proposal and supporting statement focus on the company
engaging in an internal assessment of the risks or liabilities that the company
faces as a result of its operations that may adversely affect the environment or
the public's health, we concur with the company's view that there is a basis for
it to exclude the proposal under rule 14a-8(i)(7) as relating to an evaluation
of risk. To the extent that a proposal and supporting statement focus on the
company minimizing or eliminating operations that may adversely affect the
environment or the public's health, we do not concur with the company's view
that there is a basis for it to exclude the proposal under rule 14a-8(i)(7).
The Proposal before Boeing focuses the Company, externally, on a significant
social policy issue that adversely affects the public's health and the economy
of the nation. That is the entire purpose of the Proposal and the Supporting
Statement.
Indeed, the six paragraphs of the Supporting Statement each deal with health
care as a significant social policy issue before the nation and before all
businesses. There is but one sentence in these six paragraphs that mentions
anything specific to Boeing: its more than $8 billion in Other Postretirement
Benefits. That single sentence merely supports the Supporting Statement's
description of health care reform as a significant social policy issue. The
Company also makes much of the reference to shareholder value. Needless to say,
shareholder value is impacted by this significant social policy issue, just as
another significant social policy issuelabor and human rightsimpacts
shareholder value. Neither issue is transformed into a matter of ordinary
business merely because it impacts shareholder value.
2. The fact that health care reform is a matter of national debate does not
render the significant social policy issue of health care reform a matter of
ordinary business.
The Company cites several decisions of the Staff in an attempt to argue that a
national debate on health care reform does not elevate the issue of health care
reform to the status of a significant social policy issue. Yet the decisions
cited are inapposite:
Pepsico, Inc., 1991 SEC No-Act. LEXIS 427 (March 7, 1991), involved "an
evaluation of employee health and welfare plans [that] are matters involving the
Company's ordinary business operations." The Proposal before Boeing in no way
involves an evaluation of the Company's health and welfare plans. Instead, it
focuses the Company outwardly on the issue of health care reform as a
significant social policy issue affecting the Company, businesses and the
nation.
Albertson's, Inc., 1992 SEC No-Act. LEXIS 390 (March 19, 1002), involved a
"proposal [that] is directed at involving the Company in the political or
legislative process relating to an aspect of the Company's operations." The
Proposal before Boeing is not at all aimed at involving the Company with the
political or legislative process. It merely urges the Company to adopt
principles on a significant social policy issue. Indeed, Bristol-Meyers Squibb,
which initially sought the Commission's approval to exclude a nearly identical
proposal on ordinary business grounds, has withdrawn its request and has adopted
principles for health care reform. IBM, which has successfully opposed proposals
calling for reports on health care costs and lobbying by the company, began a
dialogue with Proponent that resulted in a statement of principles for health
care reform.
Minnesota Minining and Manufacturing Co., (February 6, 1991), involved a special
report evaluating the impact of health care reform proposals upon the company.
The proposal before Boeing does not call for a report, nor does it call for an
evaluation of health care reform proposals upon the Company. It urges the Board
of Directors to adopt principles on s significant social policy issue.
Knight-Ridder, Inc. 1991 SEC No-Act. LEXIS 65 (January 23, 1991) involved a
proposal concerning "the selection and evaluation of employee health and welfare
plans, [which] are matters involving the Company's ordinary business
operations." The Proposal before Boeing has nothing to do with the selection of
Boeing's health and welfare plans. Instead, it deals with the adoption of
principles on health care reform as a significant social policy issue.
Of course Boeing is a provider of health care benefits to its employees and of
course it monitors its health care costs. Those facts in no way change the
nature of health care reform as a significant social policy issue. Just as
McDonald's has significant employee payroll and supplier operations, those facts
do not render proposals on labor and human principles matters of ordinary
business.
III. The Proposal urges the Board to adopt principles on a significant social
policy issue, not to engage the Company in the political and legislative
process.
The Company would have the Commission believe that the Proposal requires Boeing
to engage in "the political or legislative process" on "a matter of ordinary
business." The Company is wrong on both counts. First, as Proponent has
demonstrated above, the Proposal urges the Board of Directors to adopt
principles on a significant social policy issue, health care reform. The
evidence continues to mount that health care reform is a significant social
policy issue.15 Indeed, Bristol-Meyers Squibb, which initially sought the
Commission's approval to exclude a nearly identical proposal on ordinary
business grounds, has withdrawn its request and has adopted principles for
health care reform. IBM, which has successfully opposed proposals calling for
reports on health care costs and lobbying by the company, began a dialogue with
Proponent that resulted in a statement of principles for health care reform.
Second, the Proposal in no way urges the Company to involve itself in the
political or legislative process. Instead, it merely urges the Board of
Directors to adopt principles on this significant social policy issue, just as
IBM and Bristol-Meyers Squibb have now done. The Company, however, citing
Chrysler Corporation, 1992 SEC No-Act. LEXIS 143 (February 10, 1992),
mischaracterizes the Proposal as one calling for the Company to participate in
the legislative or political process. But in Chrysler, the proposal specifically
called for lobbying.16 Proponent makes no such request.
The Company also cites International Business Machines Corporation, 2002 SEC
No-Act. LEXIS 85 (January 21, 2002), in which the proposal called upon IBM to
report on:
the estimated average annual cost for employee health benefits in the United
States versus the next five countries with the largest number of IBM employees
and if found to be substantially less, join with other corporations in support
of the establishment of a properly financed national health insurance system as
an alternative for funding employee health benefits.
The Proposal makes no request for a report or data regarding Boeing's health
benefits operations, nor does it call upon the Company to join with any other
company or organization to support a "national health insurance system."
Instead, like other significant social policy proposals on human rights, it
calls upon the Company to adopt principles on a significant social policy issue.
McDonald's Corporation, 2007 SEC No-Act. LEXIS 378 (March 22, 2007); Costco
Wholesale Corporation, 2004 SEC No-Act. LEXIS 806 (October 26, 2004).
Dole Food Company, 1992 SEC No-Act. LEXIS 154 (February 10, 1992), involved a
proposal seeking to involve the company in the legislative process. While the
Commission's decision to permit the company to exclude the proposal was reversed
by the U.S. District Court, it was remanded as moot by the U.S. Court of Appeals
for the Second Circuit, New York City Employees' Retirement System v. Dole Food
Company,
969 F.2d 1430, 1433 (1992). Contrary to Boeing's assertions, the
Proposal before the Company in no way calls upon the Company to involve itself
in the legislative or political process.
IV. The Proposal is clear and unambiguous, and Boeing has failed to demonstrate
that the Proposal is so inherently vague and indefinite as to be misleading.
The Company cites two Commission decisions on No-Action Letters, The Proctor and
Gamble Company, SEC No-Action Letter, 202 SEC No-Act. LEXIS 768 (October 25,
2002), and Philadelphia Electric Company, SEC No-Action Letter, 1992 SEC No-Act.
LEXIS 825 (July 30, 1992), in support of its argument that the Proposal may be
excluded because it is so inherently vague and indefinite as to be misleading,
with the result that neither the shareholders nor the Company's Board of
Directors would be able to determine, with any reasonable amount of certainty,
what action or measures would be taken if the Proposal were implemented. Yet a
review of these decisions reveals they are not even remotely on point:
The Procter and Gamble Company excluded a shareholder proposal calling for the
establishment of a fund to provide legal assistance, witness protection and
other unspecified assistance to "victims of retaliation, intimidation and
troubles because they are stockholders/shareholders ... ."
Philadelphia Electric Company excluded a proposal calling for "the election of a
committee of small shareholders who will consider and present to the Company's
board of directors a plan ... `that will in some measure equate with the
gratuities bestowed on Management, Directors, and other employees.'"
The Proposal before Boeing is more akin to the human rights proposals that
presented in McDonald's Corporation, 2007 SEC No-Act. LEXIS 378 (March 22,
2007), and Costco Wholesale Corporation, 2004 SEC No-Act. LEXIS 806 (October 26,
2004). Those proposals called for the adoption of a company-wide code of conduct
based upon the International Labor Organization Standards. There was no attempt
to require a specific standard or a complicated implementation process involving
the company's ordinary business operations. The terms of the ILO Standard in
McDonald's, as the terms of the Institute of Medicine's Principles for Health
Care Reform, were merely cited as a point of reference for the company to design
its own code or principles. IBM, for example, sent a letter to Proponent on
principles for health care reform, while Bristol-Meyers Squibb posted a
statement of principles for health care reform on its website.
Peabody Energy Corporation, SEC No-Action Letter, 2006 SEC No-Act. LEXIS 316
(March 8, 2006), and E.I. du Pont de Nemours and Company, 2004 SEC No-Act. LEXIS
262 (February 11, 2004), also involved adoption of company-wide human rights and
labor standards that were based upon the ILO Standards. The Staff found neither
proposal vague or indefinite.
The Institute of Medicine's Principles are well defined and well regarded.
Indeed, the Institute of Medicine itself was established by the Congress to
articulate and define the significant social policy issue of health care reform.
It has done so and, as in the case of the ILO Standards before McDonald's,
United Technologies has a well-established set of principles upon which to base
its own principles for health care reform.
The Company cites several words from the Institute of Medicine's Principles as
examples of words that it claims are undefined or vague. "Universal,"
"continuous," "affordable" are among them. Each of these words has a plain
meaning in the context of principles. IBM and Bristol-Meyers Squibb have each
adopted the plain meaning of these words for their own principles for health
care reform and, Proponent submits, so can United Technologies.
V. Conclusion
Boeing has not met its burden of demonstrating that it is entitled to exclude
the Proposal under Rule 14a-8(g). The Proposal is not excludable under Rule
148-8(i)(7).
The Proposal is clear and it carefully defines its terms, relying upon the
well-established Principles for Health Care Reform adopted by the Institute of
Medicine. The Proposal may not be excluded under Rule 14a-8(i)(3) and Rule
14a8(i)(6).
Please call me at 202-637-5335 if you have any questions or need additional
information regarding this matter. I have enclosed six copies of this letter for
the Staff, and I am sending a copy to Counsel for the Company.
Sincerely,
/s/
Robert E. McGarrah, Jr.
Counsel
Office of Investment
REM/ms
opeiu #2, afl-cio
Enclosures
cc: Michael F. Lohr, Corporate Secretary
-----FOOTNOTES-----
1 Associated Press, December 28, 2007, "Issues rated as `extremely important' in
November [2007], and how that sentiment has changed [in December 2007]: Health
care: 48 percent then, 53 percent now." Associated Press-Yahoo News survey of
1,821 adults was conducted Dec. 14-20, 2007; overall margin of sampling error of
plus or minus 2.3 percentage points
2 Commonwealth Fund, "The Public's Views on Health Care Reform in the 2008
Presidential Election," January 15, 2008: 86% of Americans surveyed say health
care reform will be "somewhat important" (24%) or "very important" (62%).
3 The Wall Street Journal, December 4, 2007, p A1.
4 "Business Roundtable Unveils Principles for Health Care Reform," Press
Release, June 6, 2007, http://www.businessroundtable.org//newsroom/document.aspx?qs=5886BF807822B0F19D5448322FB51711FCF50C8.
Accessed December 4, 2007.
5 Presentations by Carl Camden, CEO, Kelly Services; Michael Critelli, Chairman
and CEO, Pitney Bowes, Inc. and Robert Galvin, M.D., Director, Global Health,
General Electric Corporation, at Conference on Business and National Health Care
Reform, sponsored by the Century Foundation and the Commonwealth Fund,
Washington, DC, September 14, 2007.
6 "National Health Care Reform: the Position of the National Business Group on
Health," National Business Group on Health, Washington, DC (July, 2006), http://www.businessgrouphealth.org.pdfs/nationalhealthcareformpositionstatement.pdf.
(Accessed December 4, 2007).
7 The Wall Street Journal, November 13, 2007, p. B4.
8 The New York Times, February 7, 2007.
9 The New York Times, August 31, 2007.
10 Kenneth Thorpe, Ph.D., cited in "Paying A Premium: The Added Cost of Care for
the Uninsured," (Families USA, Washington, DC: June 2005), p.4.
11 Kenneth Thorpe, Ph.D., "Impacts of Health Reform: Projections of Costs and
Savings," (National Coalition on Health Care, Washington, DC: 2005), p. 14.
12 Letter from Randy MacDonald, Senior Vice President, Human Resources, IBM, to
Daniel F. Pedrotty, Director, Office of Investment, AFL-CIO, December 12, 2007.
13 Letter from Heather L. Maples, Special Counsel, Division of Corporation
Finance, US Securities and Exchange Commission, to Amy L. Goodman, Gibson, Dunn
and Crutcher LLP, January 10, 2008. Bristol-Meyers also cited Rule 14a-8(i)(3)
and Rule 14a-8(i)(10).
14 Bristol-Meyers Squibb website posting: http://www.bms.com/sr/key
issues/content/data/reform.html (Accessed January 18, 2008).
15 Associated Press, December 28, 2007, "Issues rated as `extremely important'
in November [2007], and how that sentiment has changed [in December 2007]:
Health care: 48 percent then, 53 percent now." Associated Press-Yahoo News
survey of 1,821 adults was conducted Dec. 14-20, 2007; overall margin of
sampling error of plus or minus 2.3 percentage points. Commonwealth Fund, "The
Public's Views on Health Care Reform in the 2008 Presidential Election," January
15, 2008: 86% of Americans surveyed say health care reform will be "somewhat
important" (24%) or "very important" (62%).
16 "ONE or more Chrysler officers and/or directors SHALL actively support and
lobby for UNIVERSAL HEALTH coverage (sic) ..." Chrysler Corporation, 1992 SEC
No-Act. LEXIS 143 (February 10, 1992).
[INQUIRY LETTER]
January 18, 2008
VIA EMAIL
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Chief Counsel
100 F Street N.E.
Washington, D.C. 20549
Email address: cfletters@sec.gov
Re: Shareholder Proposal Concerning Health Care Reform Submitted by the AFL-CIO
Reserve Fund for Inclusion in The Boeing Company 2008 Proxy Statement
Dear Sir or Madam:
We submit this letter to supplement our previous letter to the staff of the
Division of Corporate Finance (the "Staff"), dated December 21, 2007, regarding
the above-referenced shareholder proposal (the "Proposal") submitted to The
Boeing Company, a Delaware corporation ("Boeing" or the "Company"), by the
AFL-CIO Reserve Fund (the "Proponent") for inclusion in the proxy statement to
be distributed to the Company's stockholders in connection with its 2008 Annual
Meeting (the "2008 Proxy Statement").
As explained in our December 21, 2007 letter, the Company intends to exclude the
Proposal from the 2008 Proxy Statement and form of proxy (the "2008 Proxy
Materials") because it does not comply with certain provisions of Rule 14a-8
under the Securities Exchange Act of 1934, as amended. In addition to the
reasons set forth in our December 21, 2007 letter, we believe that Boeing may
properly exclude the Proposal from the 2008 Proxy Materials pursuant to Rule
14a-8(i)(3) and Rule 14a-8(i)(6) because the Proposal is vague and indefinite
and the Company cannot determine how to implement the Proposal's objectives.
The Proposal relates to health care reform and states, in relevant part:
RESOLVED: Shareholders of The Boeing Company (the "Company") urge the Board of
Directors (the "Board") to adopt principles for health care reform based upon
principles reported by the Institute of Medicine:
1. Health care coverage should be universal.
2. Health care coverage should be continuous.
3. Health care coverage should be affordable to individuals and families.
4. The health insurance strategy should be affordable and sustainable for
society.
5. Health insurance should enhance health and well being by promoting access to
high-quality care that is effective, efficient, safe, timely, patient-centered,
and equitable.
Under Rule 14a-8(i)(3), a company may properly exclude a proposal that is both
vague and indefinite. Relief on this basis may be sought if "neither the
stockholders voting on the proposal, nor the company in implementing the
proposal (if adopted), would be able to determine with any reasonable certainty
exactly what actions or measures the proposal requires." Division of Corporation
Finance, Staff Legal Bulletin No. 14B (Sept. 15, 2004); Philadelphia Electric
Co., SEC No-Action Letter, 1992 WL 186643 (July 30, 1992). See also Alaska Air
Group, Inc., SEC No-Action Letter, 2007 WL 1152662 (Apr. 11, 2007) (proposal
seeking to amend the company's governing documents "to assert, affirm and define
the right of the owners of the company to set standards of corporate governance"
excludable as vague and indefinite); Bank of America Corp., SEC No-Action
Letter, 2007 WL 528626 (Feb. 12, 2007) (proposal seeking to reduce the company's
investments until the satisfaction of certain conditions in the State of Israel
excludable as vague and indefinite); International Business Machines Corp., SEC
No-Action Letter, 2005 WL 267905 (Feb. 2, 2005) (proposal seeking to reduce
executive compensation excludable as vague and indefinite); The Procter & Gamble
Co., SEC No-Action Letter, 2002 WL 31426319 (Oct. 25, 2002) (proposal seeking
creation of a witness protection fund excludable as vague and indefinite).
Similarly, a vague and indefinite shareholder proposal may be considered beyond
a company's power to effectuate and therefore excludable under Rule 14a-8(i)(6)
where a company cannot determine how to implement the proposal's objectives. See
International Business Machines Corp., SEC No-Action Letter, 1992 WL 6639 (Jan.
14, 1992) (determining that a company lacks the power to effectuate a proposal
that "is so vague and indefinite that a registrant would be unable to determine
what action should be taken"); see also NYC Employees' Retirement System v.
Brunswick Corp., 789 F. Supp. 144 (S.D.N.Y. 1992) (holding that a proposal
involving the implementation of a national health insurance plan was vague,
misleading, and beyond the corporation's power to effectuate because the
proposal "as drafted lacks the clarity required of a proper shareholder
proposal").
The Proposal is vague and indefinite because the broad language of the Proposal
does not specify what the Proponent is requesting, thereby rendering the
Proposal subject to multiple interpretations. The operative phrase of the
Proposal, "adopt principles for health care reform" is so utterly unclear that
neither the Company nor its shareholders would be able to determine the
Proposal's precise objective. In fact, the Proposal could be subject to at least
three different interpretations, such that the Proposal could be read to
constitute one of the following: (1) a request that the Board of Directors adopt
a list of principles similar to a corporate policy statement; (2) a request that
the Company reform its employee health care and benefit programs to meet all of
the features of the listed principles; or (3) a request that the Company insert
itself into the political or legislative process to expand national health care
coverage. Each of the above interpretations would give rise to vastly different
results, rendering the Proposal materially misleading.
Furthermore, many of the components of the principles outlined in the Proposal
are themselves subject to different interpretation. Specifically, the terms
"universal," "continuous," "affordable," "sustainable," "effective,"
"efficient," "safe," "timely," "patient-centered," and "equitable," as they
relate to health care coverage and health insurance, are unclear. As in Fuqua
Industries, Inc., SEC No-Action Letter, 1991 WL 178684 (Mar. 12, 1991). "any
action ultimately taken by the Company upon implementation [of the proposal]
could be significantly different from the actions envisioned by shareholders
voting on the proposal."
The breadth of the Proposal and its inherent ambiguities make it impossible for
the Company, its Board of Directors or its shareholders to determine with any
degree of certainty what types of "principles of health care reform," are to be
adopted to comply with the vague and ill-defined terms used in the Proposal. It
is inevitable that different shareholders will have different views on the
Proposal when casting their votes, thereby creating further uncertainty for the
Company and the Board in interpreting and implementing the intent of those
shareholders who vote in favor of the Proposal. Because the Proposal is
ambiguous and contains terminology that would not allow shareholders or the
Company to understand how the Proposal would operate or the actions that the
Company would be expected to take to implement the Proposal, the Proposal is
excludable under Rule 14a-8(i)(3) and Rule 14a-8(i)(6).
Therefore, for the reasons set forth herein and in our prior letter, the Company
hereby respectfully requests that the Staff confirm that it will not recommend
any enforcement action to the Securities and Exchange Commission if Boeing
excludes the Proposal from the 2008 Proxy Materials.
In accordance with Rule 14a-8(j), we are simultaneously providing a copy of this
letter via email and courier to the Proponent's representative.
Should you have any questions regarding any aspect of this matter or require any
additional information, please call me at (312) 544-2802.
Very truly yours,
/s/
Michael F. Lohr
Corporate Secretary
cc: AFL-CIO Reserve Fund
[APPENDIX 1]
November 20, 2007
By UPS Next Day Air
James C. Johnson, Corporate Secretary
The Boeing Company
100 North Riverside Plaza
311A1, MC 5003-1001
Chicago, Illinois 60606-1596
Dear Mr. Johnson:
On behalf of the AFL-CIO Reserve Fund (the "Fund"), I write to give notice that
pursuant to the 2007 proxy statement of The Boeing Company (the "Company"), the
Fund intends to present the attached proposal (the "Proposal") at the 2008
annual meeting of shareholders (the "Annual Meeting"). The Fund requests that
the Company include the Proposal in the Company's proxy statement for the Annual
Meeting. The Fund is the beneficial owner of 600 shares of voting common stock
(the "Shares") of the Company and has held the Shares for over one year. In
addition, the Fund intends to hold the Shares through the date on which the
Annual Meeting is held.
The Proposal is attached. I represent that the Fund or its agent intends to
appear in person or by proxy at the Annual Meeting to present the Proposal. I
declare that the Fund has no "material interest" other than that believed to be
shared by stockholders of the Company generally. Please direct all questions or
correspondence regarding the Proposal to me at (202) 637-5379.
Sincerely,
/s/
Daniel F. Pedrotty
Director
Office of Investment
DFP/ms
opeiu #2, afl-cio
Attachment
[APPENDIX 2]
Shareholder Proposal
RESOLVED: Shareholders of The Boeing Company (the "Company") urge the Board of
Directors (the "Board") to adopt principles for health care reform based upon
principles reported by the Institute of Medicine:
1. Health care coverage should be universal.
2. Health care coverage should be continuous.
3. Health care coverage should be affordable to individuals and families.
4. The health insurance strategy should be affordable and sustainable for
society.
5. Health insurance should enhance health and well being by promoting access to
high-quality care that is effective, efficient, safe, timely, patient-centered,
and equitable.
Supporting Statement
The Institute of Medicine, established by Congress as part of the National
Academy of Sciences, issued five principles for reforming health insurance
coverage in a report, Insuring America's Health: Principles and Recommendations
(2004). We believe principles for health care reform, such as those set forth by
the Institute of Medicine, are essential if public confidence in our Company's
commitment to health care coverage is to be maintained.
Access to affordable, comprehensive health care insurance is the most
significant social policy issue in America according to polls by NBC News/The
Wall Street Journal, the Kaiser Foundation and The New York Times/CBS News. In
our opinion, health care reform also is a central issue in the presidential
campaign of 2008.
Many national organizations have made health care reform a priority. In 2007,
representing "a stark departure from past practice," the American Cancer Society
redirected its entire $15 million advertising budget "to the consequences of
inadequate health coverage" in the United States (The New York Times, 8/31/07).
John Castellani, president of the Business Roundtable (representing 160 of the
country's largest companies), has stated that 52 percent of the Business
Roundtable's members say health costs represent their biggest economic
challenge. "The cost of health care has put a tremendous weight on the U.S.
economy," according to Castellani, "The current situation is not sustainable in
a global, competitive workplace." (Business Week, July 3, 2007)
The National Coalition on Health Care (whose members include some of the largest
publicly-held companies, institutional investors and labor unions) also has
created principles for health insurance reform. According to the National
Coalition on Health Care, implementing its principles would save employers
presently providing health insurance coverage an estimated $595-$848 billion in
the first 10 years of implementation.
Our Company currently has Other Postretirement Benefit (which includes health
care benefits) liability of more than $8 billion, according to its 10-K. We
believe that the 47 million Americans without health insurance results in higher
costs to our Company, as well as all other U.S. companies that provide health
insurance to their employees. Annual surcharges as high as $1,160 for the
uninsured are added to the total cost of each employee's health insurance,
according to Kenneth Thorpe, a leading health economist at Emory University.
Moreover, we feel that increasing health care costs further reduce shareholder
value when it leads companies to shift costs to employees, thereby reducing
employee productivity, health and morale.
[STAFF REPLY LETTER]
February 5, 2008
Response of the Office of Chief Counsel Division of Corporation Finance
Re: The Boeing Company Incoming letter dated December 21, 2007
The proposal urges the board of directors to adopt principles for health care
reform based upon principles specified in the proposal.
We are unable to
concur in your view that Boeing may exclude the proposal under rules 14a-8(i)(3)
or 14a-8(i)(6). Accordingly, we do not believe that Boeing may omit the proposal
from its proxy materials in reliance on rules 14a-8(i)(3) or 14a-8(i)(6).
We are unable to concur in your view that Boeing
may exclude the proposal under rule 14a-8(i)(7). Accordingly, we do not believe
that Boeing may omit the proposal from its proxy materials in reliance on rule
14a-8(i)(7).
Sincerely,
/s/
Eduardo Aleman
Attorney-Adviser
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