Court Rejects Speedier Yahoo Severence Trial

June 17, 2008 11:20 a.m. EST

Dove, DE (AHN) - A Delaware judge Monday rejected a call to hear a lawsuit by Yahoo investors before the Internet company meets Aug. 1 to elect new board members. Two pension funds had asked for speedier attention, suggesting the recent ad deal with Google was designed to blunt support for Carl Icahn's proxy fight.

Delaware Chancellor William Chandler, however, said the Google pact did not change the facts of the case, brought in February by two Detroit pension funds against how Yahoo responded to a takeover bid by Microsoft.

ICahn earlier announced his own slate of candidates that could replace Yahoo board members. Another investor, Eric Chandler, is now suggesting Yahoo and Icahn compromise, with five Yahoo board members retaining thier seats along with the election of four Icahn-picked board members.