Court Upholds SEC Rule on Conflicts Minerals

On July 23, 2013, the US District Court for the District of Columbia found “no problems with the SEC’s rulemaking” by its adoption of the Conflict Minerals Rule pursuant to Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”). In granting summary judgment to the Securities and Exchange Commission (the “Commission”) and upholding the Conflict Minerals Rules, the Court concluded that the Plaintiffs’ (the National Association of Manufacturers, the Chamber of Commerce and Business Roundtable) “claims lack merit.”

In rendering its opinion, the Court disagreed with the Plaintiffs’ argument that the ‘conflict minerals’ disclosure scheme and Section 1502 of Dodd-Frank compels speech in violation of the First Amendment of the Constitution. The Court also disagreed with the Plaintiffs’ other arguments in concluding that the Commission did not ignore its statutory obligations under the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) in approving the Conflict Minerals Rule, nor was its rulemaking arbitrary and capricious under the Administrative Procedures Act.

Please see full memo below for more information.

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