Carl Icahn. Photo credit: Tua Ulamac/Flickr

The two-lawyer in-house legal department at Icahn Enterprises has its hands full after billionaire investor Carl Icahn, the top shareholder of Norwalk, Connecticut-based Xerox Corp., said Monday he has convinced the third-largest shareholder, Texas tycoon Darwin Deason, to join in his proxy fight with Xerox.

Icahn is represented by his in-house lawyers, led by Jesse Lynn, who declined to comment on the fight. But knowledgeable sources said legal departments can be tied up for months by proxy battles, as they review proxy materials and write letters seeking other shareholders' support.

Deason is represented by King & Spalding partner James Woolery, who leads the firm's merger/acquisitions and corporate governance team. Woolery is working with partner Robert Leclerc, who focuses on capital markets and private equity. Leclerc said King & Spalding also declined to comment on the proxy fight.

Deason is chairman of Deason Capital Services in Dallas. Between them, Icahn and Deason—and their affiliates—own over 40 million shares of Xerox, or 15.7 percent of the company's outstanding shares, according to a filing Monday with the U.S. Securities and Exchange Commission.

As part of the filing, Icahn and Deason released a joint statement saying they were acting in concert to solicit proxies to elect four new directors to the Xerox board. The document cited five key goals for their actions:

• A joint venture in Japan, Fuji Xerox Co., should be terminated or renegotiated to make it more favorable to Xerox after a recent accounting scandal at Fuji Xerox. FujiFilm Holdings owns 75 percent of the joint venture, and Xerox owns 25 percent.

• Xerox should disclose the agreements governing the Fuji Xerox joint venture.

• Xerox should commence a process with new independent advisers to explore strategic alternatives.

• Xerox CEO Jeff Jacobson, “a member of the Xerox 'old guard,' is incapable of creating long-term value for Xerox shareholders and should be replaced immediately.”

• If the “old guard” directors are unwilling to make the tough decisions necessary, then they must be replaced as well.

The document also cited a recent Wall Street Journal article that said Xerox is in talks with FujiFilm “regarding an array of potential transactions that may or may not include a change of control of Xerox.”

Icahn and Deason said they do not oppose a possible merger, but said they do not want the current board and CEO to negotiate any such deal.

Xerox released a statement to Corporate Counsel late Monday in response to Icahn's announcement.

“The Xerox board of directors and management are confident with the strategic direction in which the company is heading and we will continue to take action to achieve our common goal of creating value for all Xerox shareholders,” the statement said.