In a recent ruling, Judge Manish S. Shah of the United States District Court for the Northern District of Illinois delivered a narrowed down perspective to a putative class action. This action asserted claims under the Securities Exchange Act of 1934 against an unnamed airplane manufacturer, as well as its ex-CEO and ex-CFO. The case…
The landscape of corporate law is constantly evolving, with the shifting lines around investigations by the Securities and Exchange Commission (SEC) being a key area of recent focus. It is essential for legal professionals and corporations to understand how this impacts Directors and Officers (D&O) insurance coverage. As highlighted in a recent article by Woodruff…
In a race towards environmental reform, California has sprinted ahead. On October 7, 2023, Governor Newsom ratified California Senate Bill 253 (SB 253), known as the Climate Corporate Data Accountability Act. This marks a significant advance in how official disclosure requirements for greenhouse gas emissions are executed in the United States.[1] With the formal enactment…
On October 10th, 2023, changes to the rules governing beneficial ownership reporting under Sections 13(d) and 13(g) of the Securities Exchange Act of 1934 were adopted by the Securities and Exchange Commission (SEC). The changes include, but are not limited to, shorter deadlines for initial Schedule 13D filings and amendments, with the latter requiring filing…
California has assumed a pioneering role on climate change-related financial disclosures, outpacing the federal government in the implementation of new green legislation. This comes as public companies await the Securities and Exchange Commission’s (SEC) final climate disclosure rules, anticipated to be disseminated in the fourth quarter of 2023. Breaking ranks with the long-standing regulatory standards,…
On September 27, 2023, the U.S. Securities and Exchange Commission (SEC) named six officers, directors, and significant shareholders of public companies, alongside five corporations, in a marked effort to enforce strict adherence to rules pertaining to the disclosure of ownership and stock transactions. This move has been initiated in an attempt to clamp down on…
In a landmark argument recently, a hedge fund manager levelled a challenge against the constitutionality of administrative law judges overseeing securities fraud actions. The allegation is that these presiding judges, appointed directly by regulators, are unsuitable for deciding penalty-carrying cases, as these necessitate a constitutionally-guaranteed jury trial. These arguments were laid out before the US…
The surge in M&A activity within the biotech sector in recent years is now leading to a surge in shareholder lawsuits. Investors are seeking to block or rescind these deals, launching securities lawsuits despite the limited likelihood of their success in preventing a finalized merger or overturning an approved one. As the high tide of…
Last year, the Securities and Exchange Commission (SEC) made a proposition to substantially expand the scope of what is defined as an “exchange.” This proposition could have the effect of broadening the SEC’s regulatory purview over a wider range of technologies vital to the securities markets. The proposal has been recently in the limelight as…
In a recent development, regulators have achieved a significant breakthrough in their efforts to maintain transparency and compliance in the financial sector. This milestone comes in the form of their first enforcement action targeting “off-channel” communications, following years of cautioning broker-dealers and investment advisers about lax record-keeping practices. These practices involved the widespread use of…
Both public and private corporations have been urged to review their confidentiality policies and written agreements, given recent guidance and enforcement actions by the Securities and Exchange Commission (SEC). This advice follows the SEC’s issuance of a $10 million civil penalty against registered investment advisor D. E. Shaw & Co., L.P., a precedent-setting event in…
On September 29, 2023, the U.S. Securities and Exchange Commission (SEC) launched charges against several firms for significant recordkeeping violations. The crux of these violations lies primarily in the extensive and continued use of off-channel communications. This information, provided by The Volkov Law Group, outlines the potential perils and wide-ranging legal implications of using various…
In continuing to serve our clients in this ever-evolving legal landscape, we understand the importance of staying current with the latest developments affecting public companies. In this context, we draw your attention to the recent happenings in the third quarter of 2023 brought before the Securities and Exchange Commission (SEC). The Public Company Advisory Practice…
The US Securities and Exchange Commission (SEC) has given the greenlight for the implementation of amendments aimed at modernizing beneficial ownership reporting. This adoption, enacted without an open meeting, provides a facelift to the regulations governing beneficial ownership reporting under the Exchange Act Sections 13(d) and 13(g). The primary objective of these amendments is to,…
In a pivotal move, California has taken a significant step in combating climate change. Governor Gavin Newsom signed two bills into law on October 7th, demanding extensive disclosures from corporations large and small based in California, as reported by JD Supra. These pieces of legislation, Senate Bill 253 and Senate Bill 261, will mandate thousands…
Regulators worldwide persist in their focus on disclosures and marketing involving environmental, social, and governance (ESG) issues. Echoing this trend, the U.S. Securities and Exchange Commission (SEC) adopted amendments to Rule 35d‑1 (the “Names Rule”) under the Investment Company Act of 1940, as amended (the “1940 Act”) on September 20, 2023. This amendment is in…
On September 20, 2023, the Securities and Exchange Commission (the “SEC”) made significant alterations to Rule 35d-1 (the “Names Rule”). Implemented under the Investment Company Act of 1940, as amended, the rule was devised to prevent the utilization of fund names that the SEC considers misleading to investors with regard to a fund’s investments and…
On a recent issue in the world of legal and corporate finance, the Securities and Exchange Commission (SEC) decided to settle charges with a mutual fund adviser. The charges were related to violations in Environmental, Social, and Governance (ESG) rules, which are increasingly gaining focus in today’s corporate world. The Seward & Kissel LLP report,…
In a critical legal decision, the U.S. Court of Appeals for the Eleventh Circuit upheld the Department of Labor’s Administrative Review Board’s denial of an employee’s Sarbanes-Oxley Act (SOX) retaliation claim. This ruling came about on September 25, 2023, affirming that the employee had not taken part in protected activity as they were unable to…
In an unexpected turn of events, Alpine Securities Corp., previously expelled from the Financial Industry Regulatory Authority’s (FINRA) membership, has won a significant injunction from the D.C. Circuit Court of Appeals. This injunction, issued on July 5, 2023, creates a challenge to FINRA’s authority by allowing Alpine to remain a member while appealing its expulsion….
The US Supreme Court recently listened to oral arguments in the major whistleblower case, Murray v. UBS Securities, LLC. The lawsuit raises the question whether publicly traded companies can discriminate against employees who report wrongdoing within the organization. The scenario originated when Trevor Murray, who joined the commercial mortgage-backed securities department of UBS in 2011,…
On October 10, 2023, the U.S. Securities and Exchange Commission (SEC) adopted final rules, altering the beneficial ownership reporting requirements under Sections 13(d) and 13(g) of the Securities Exchange Act of 1934 (Exchange Act). These changes are intended to provide more timely information on investor holdings. You can read more about the SEC update here….
Delays in the posting of stock transactions and other financial disclosures by US judges are creating bottlenecks in a recently-developed database. This is unfortunately detracting from its intended purpose: to improve and promote public transparency within the court system. This observation has been voiced by several watchdogs closely scrutinizing the system. A report from Bloomberg…
The legal victory of Grayscale in their recent dispute, Grayscale Investments v. SEC, over a Bitcoin exchange-traded fund (ETF) decision has stirred discussions within legal and crypto walls. The U.S. Court of Appeals for the D.C. Circuit ruled that the Securities and Exchange Commission acted unlawfully in denying Grayscale’s application for a Bitcoin ETF. The…
It’s the second week of the new term at the Supreme Court, with two somewhat standard cases set for argument. This week brings some notable highlights, however, as Tuesday sees the late Justice Antonin Scalia’s son, Eugene Scalia, making his maiden appearance before the high court in Murray v. UBS Securities LLC. As described in…