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SEC Can’t Pass On Pot Stock Puffery

Corporations facing federal securities suits can sometimes avoid liability by claiming that their forward-looking statements were so vague or indefinite that they could not have affected the company’s stock price and are...more

8/8/2014 - Enforcement Enforcement Actions Fraud Professional Liability SEC Securities Act of 1933 Securities Fraud White Collar Crimes

Have Your Directors Met Their Revlon Duties? Delaware Court Dismisses Strike-Suit Allegations as Merely Cosmetic

In a virtual course on how to bring—or not bring—an M&A strike suit, on June 30, a Delaware Chancery Court dismissed all shareholder claims against a merger target and its acquirer, ending nearly two years of litigation. ...more

7/9/2014 - Board of Directors Corporate Counsel Corporate Governance Revlon Standard Shared Responsibility Rule Shareholders

You Were Wrong, But Did You Know You Were Wrong? The Supreme Court To Resolve The Circuit Split On The Pleading Standard For...

Can a securities plaintiff satisfy Section 11 of the Securities Act simply by alleging that a statement of opinion was objectively false, or must the plaintiff also allege that the speaker subjectively knew the statement was...more

3/19/2014 - Omnicare Pharmaceutical Pleading Standards SCOTUS Section 11 Securities Fraud

You Better Forum-Shop Around . . . While You Still Can

On January 31, 2014, Chevron Corporation moved to certify to the Delaware Supreme Court the question of whether exclusive forum bylaws are valid under Delaware law. Chevron filed its motion before the Honorable Jon S. Tigar...more

2/12/2014 - Forum Forum Selection Clause Forum Shopping

Back To The Drawing Board: The SEC Loses Another Insider Trading Trial

On January 7, 2014 the SEC lost an insider trading bench trial before Judge William Duffey of the U.S. District Court for the Northern District of Georgia. In a thorough opinion, Judge Duffey found the SEC’s case to be...more

1/15/2014 - Circumstantial Evidence Insider Trading SEC Whistleblowers

Pack Your Bags: SEC And DOJ To Intensify The Spotlight On The Foreign Corrupt Practices Act

Comments made by Kara N. Brockmeyer, the Securities Exchange Commission’s chief of the Foreign Corruption Practices Act (FCPA) unit, and Charles E. Duross, deputy chief of the Department of Justice’s FCPA unit, at the recent...more

11/27/2013 - Anti-Corruption Compliance DOJ Enforcement Actions FCPA SEC Travel

A Bird In The Hand Is Worth … Nothing If You Can’t Really Sell It

A pair of investment firms recently filed suit against Twitter in the Southern District of New York, alleging that Twitter had fraudulently refused to allow them to sell its private stock in advance of its much-anticipated...more

11/6/2013 - Fraud IPO Stocks Twitter

NBA Team Owner Mark Cuban “Talks Trash” After Defense Verdict

Following a defense verdict in the insider trading case brought against him by the SEC, Dallas Mavericks owner Mark Cuban has not been sitting on the bench—but rather using his blog to stay on the offensive. Since the...more

10/30/2013 - Insider Trading SEC Sports

Lookout For The SEC: After First Demanding More Admissions, The SEC Is Additionally Increasing Monetary Penalties And Giving...

After first announcing a change on June 18 of this year to demand more admissions in SEC actions, an SEC leader recently made further comments echoing that same sentiment, as well as referencing the SEC’s intended use of...more

10/8/2013 - Citigroup Civil Monetary Penalty SEC Settlement

Second Circuit To Issuers: You Need Not Disclose Every Single Asset In Your Registration Statements

That was the Second Circuit’s message to companies in a September 25, 2013 order (link) by upholding dismissal of claims against defendant Royal Bank of Scotland (“RBS”) for alleged failure to disclose enough information...more

10/1/2013 - Corporate Issuers Disclosure Requirements Issuers Registration Royal Bank of Scotland Subprime Mortgages

How Much Latitude Do Directors Have In Setting Executive Compensation?

Executive compensation decisions are core functions of a board of directors and, absent unusual circumstances, are protected by the business judgment rule. As Delaware courts have repeatedly recognized, the size and...more

9/30/2013 - Business Judgment Rule CEOs Delegation of Discretion Dodd-Frank Executive Compensation Say-on-Pay

A Tale Of Two Paychecks; Ralph Lauren Makes 1,900 Times More Than You And The SEC Thinks You Should Know

On September 18, 2013, the SEC voted to propose a new rule that would require public companies to disclose the ratio of compensation of its CEO to the median compensation of its employees. The new rule, required under...more

9/23/2013 - CEOs Disclosure Requirements Dodd-Frank Pay Ratio Ralph Lauren SEC

When Are Directors Liable For Failing To Exercise Proper Oversight?

Recently we discussed whether directors of public companies face potential liability for not preventing cyber attacks. As we discussed, the answer is generally no, because absent allegations to show a director had a...more

9/9/2013 - Breach of Duty Cyber Attacks Cybersecurity Directors Fiduciary Duty Liability Oversight Committee

A Ponzi Of A Different Color

High profile schemes perpetrated by Bernie Madoff, Allen Stanford, Nevin Shapiro, and others have brought, or at least reinforced, a general understanding of the term “Ponzi scheme” into the public lexicon. But what,...more

9/2/2013 - Ponzi Scheme Securities Fraud

Shareholder Books And Records Requests To Become More Frequent, And More Potent

As we previously detailed, a shareholder’s request for corporate books and records can raise competing concerns for the company and its directors. ...more

8/12/2013 - Board of Directors Books & Records Corporate Governance Shareholders

Does A Board Need To Put A “For Sale” Sign On The Company When Considering A Change-Of-Control Transaction?

When a board of directors decides to enter the company into a change-of-control transaction, the board is charged with the duty to act reasonably to secure the best value reasonably attainable for its shareholders....more

8/5/2013 - Acquisitions Board of Directors Change of Ownership Mergers Shareholders

How Corporate Charters Can Protect Directors From Money Damages For Acts Of Negligence

Several weeks ago we asked whether directors of public companies face potential liability for not preventing cyber attacks....more

7/12/2013 - Board of Directors Corporate Charters Corporate Governance Damages Fiduciary Duty Negligence

Does Your Director Have A Guilty Conscience? SEC To Press For More Admissions

Some of the SEC’s enforcement targets are no longer in denial, or at least they won’t be if a recent policy shift at the regulator takes hold. ...more

7/4/2013 - Admissions of Liability Directors Enforcement Mary Jo White SEC

Do A Deal And You’re Sure To Get Sued; Now, At Least, You Can Get Sued In Just One Place

These days almost every public company that announces an agreement to sell itself can expect to be the subject of multiple shareholder class actions challenging the transaction – even if shareholders will be receiving a...more

6/28/2013 - Bylaws Class Action Corporate Governance Multidistrict Litigation Shareholders

Do Directors Face Potential Liability For Not Preventing Cyber Attacks?

In the past weeks, we’ve reported that while most companies are properly disclosing their exposure to cybersecurity threats, the increasing occurrence and severity of cyber attacks has the SEC considering even more stringent...more

6/25/2013 - Board of Directors Covenant of Good Faith and Fair Dealing Cyber Attacks Cybersecurity Disclosure Requirements Fiduciary Duty SEC

Do Trades Made Pursuant To 10b5-1 Plans Still Offer A Defense To Insider Trading?

Rule 10b5-1, enacted in August 2000, codified the SEC’s position that trading while in possession of material non-public information is sufficient to establish liability for insider trading....more

6/14/2013 - CII Insider Trading Rule 10b-5 SEC

Recent Study Finds Cybersecurity Disclosures May Fail To Meet SEC Guidelines

Hackers aren’t the only ones after company information. Earlier this week, Wills Fortune 500, a unit of Wills Group Holdings, a global insurance broker providing insurance and risk management services, made available its own...more

6/13/2013 - Cybersecurity Disclosure Requirements SEC

Going-Private Transaction With A Controlling Stockholder – What Standard Of Review Applies?

We previously discussed how important a special negotiating committee of independent directors can be when defending against stockholder challenges to change-of-control transactions – particularly for going private...more

6/3/2013 - Board of Directors Business Judgment Rule Controlling Stockholders Going-Private Transactions Shareholders

What’s The Right Way To Respond To A Shareholder Books And Records Request?

Delaware law gives shareholders the right to request corporate books and records in order to investigate issues that are of interest to them. ...more

5/17/2013 - Corporate Records Shareholder Rights

“We’re Considering Selling The Company – How Can A Special Committee Help?”

In any change-of-control business transaction, the decision by the target company’s board of directors to approve the deal is subject to heightened scrutiny by the courts. These days, virtually every M&A deal is sure to...more

5/13/2013 - Board of Directors Change in Control Conflicts of Interest Corporate Governance

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