Icahn asked a court to block rule changes Michael Dell has proposed ahead of a shareholder vote set for Friday. Icahn and his affiliates also want the court to stop Dell from changing the record date by which shareholders must have purchased their shares in order to vote.

They want to stop Michael Dell from voting any Dell shares acquired since February 5 at any annual shareholder meeting. The February 5 date was when his buyout bid was announced. The lawsuit also seeks the court to bar the company from changing any shareholder voting requirements.

The lawsuit, filed in the Court of Chancery of Delaware, seeks to force the company to call an annual shareholder meeting on the same day as the special meeting on the buyout in case Dell Inc sets a new record date.

"My personal reaction, bombastic," said Larry Hamermesh, a professor at the Widener University School of Law in Wilmington, Delaware, referring to the lawsuit. "The linchpin of it seems to be that it's inappropriate to move or create a new record date because that takes advantage of a cynical effort to put shares in the hands of arbitrageurs who will want to vote for the deal."

Hamermesh pointed out that the judge who is likely to take this case, Leo Strine, often made the point in the takeover battle by industrial gases companies Air Products of rival Airgas that arbitrageurs are shareholders with the same rights.

Icahn, who views Michael Dell's offer as too low, has amassed an 8.7 percent stake in Dell and is leading a charge with Southeastern Asset Management against the buyout with an offer of his own. He has been campaigning to get Dell to set a date for the annual shareholder meeting so he can put up his own slate of directors for the company.

A spokesman for Dell Inc declined to comment on the suit but said Dell board has always sought to act in accordance with its fiduciary duties.

"Tenuous" talks between the buyout group and Dell's special board committee for a higher bid are continuing and they're "making progress," CNBC said on Thursday.

The debate over the go-private transaction has dragged on for months, jeopardizing the future of the computer maker facing a decline in its core business of personal computers amid the growing popularity of tablets. Michael Dell has said a turnaround of Dell should be done away from the scrutiny of public investors.

THIRD ATTEMPT AT VOTE

A vote on the buyout, which has been postponed twice, is now scheduled for Friday and sources familiar with the matter have said another adjournment is unlikely.

The special committee has said it would put the original buyout offer of $13.65 per share up for a shareholder vote.

Dell's special board committee rejected new voting terms in a revised bid by Michael Dell and Silver Lake, which raised their offer price last week by 10 cents to $13.75 per share on the condition the voting rules were changed.

Currently, shareholders who abstain are counted as voting against the deal, but the buyout group wanted those investors to be excluded from the tally.

Michael Dell's unusual demand sparked outrage among major investors, but the buyout group had said about 27 percent of the unaffiliated shares had not yet been voted and the presumption that these shares should be treated as if they had voted against the transaction was unfair.

The votes that have come in so far are split evenly between yes and no, sources have said, but there appears to be some signs that Michael Dell could get more votes.

Some of Dell's largest investors, who have abstained from voting on the buyout, told the company's board this week that they would back the deal at the buyout group's latest offer price, three sources close to the matter have told Reuters.

Dell's shares closed up 2.3 percent at $12.96 on the Nasdaq.

(Reporting by Poornima Gupta and Edwin Chan; Editing by Gerald E. McCormick and David Gregorio)

©2013 Thomson Reuters.