Directors

Further Setback for the CFPB Director’s Authority?

by Marc Hearron, Andrew M. Smith, Nancy R. Thomas | Morrison & Foerster LLP on 5/20/2013

A split panel of the U.S. Court of Appeals for the Third Circuit issued a decision yesterday holding that a “recess” appointment to the National Labor Relations Board (NLRB) was unconstitutional and invalid. NLRB v. New Vista...more

Florida Officer-Director Liability For Business Torts

by Schecter Law on 5/16/2013

Generally, a director or officer of a corporation does not incur personal liability for [the corporation’s] torts merely by reason of his official character; he is not liable for torts committed by or for the corporation...more

What Makes A Director “Independent”?

by Jim Kramer, M. Todd Scott, Alex Talarides | Orrick - Securities Litigation and Regulatory... on 5/3/2013

What makes a director “independent”? That question is important, not only to investors who want to ensure that boards of directors exercise objective judgment on corporate affairs, but also to companies, who need assurance...more

House Committee Refuses To Allow CFPB Director To Appear

by BuckleySandler LLP on 5/3/2013

On April 22, House Financial Services Committee Chairman Jeb Hensarling (R-TX) sent letters to CFPB Director Richard Cordray and CFPB General Counsel Meredith Fuchs stating that the House Financial Services Committee cannot...more

Fourth Circuit Court Of Appeals Puts Teeth Into The "In Fact" Exclusions Of A D&O Policy

by Steven Brodie, Joseph Lang Jr., Sylvia H. Walbolt | Carlton Fields on 4/24/2013

In Farkas v. Nat'l Union Fire Ins. Co. of Pittsburgh, PA, No. 12-1481, 2013 WL 1459248 (4th Cir. Apr 11, 2013), the Fourth Circuit Court of Appeals affirmed a decision that put teeth into the "in fact" exclusions of a...more

Liability of Directors in Canada – An Excerpt

by Ellyn Law LLP on 4/10/2013

This article is an excerpt of the Canada Chapter of International Liability of Corporate Directors, 2nd edition, published by Juris Publishing in February 2013. This excerpt excludes numerous aspects of the full chapter,...more

Benefit Corporations – A New Type Of Corporation – Are Now Authorized In Pennsylvania

by Julianna Labruto, Michael Sherman | Cozen O'Connor on 3/14/2013

On January 23, 2013, the Pennsylvania Benefit Corporation Act (the Act) became effective. The Act authorizes a new type of for-profit business corporation known as a benefit corporation. Pennsylvania is now one of 12 states...more

Jepsco, Ltd. v. B.F. Rich Co., Inc., C.A. No. 7343-VCP (Del. Ch. Feb. 14, 2013) (Parsons, V.C.)

by Potter Anderson & Corroon LLP on 2/28/2013

The Delaware Court of Chancery held that claims for breach of statutory and fiduciary duties against a custodian appointed under Section 226 of the Delaware General Corporation Law (“DGCL”) failed as a matter of law because...more

Small Business Securities Bulletin - SEC Approves Nasdaq Rule Addressing Compensation Committees, Consultants

by Penny Somer Greif | Ober|Kaler on 2/22/2013

A periodic bulletin keeping small businesses informed about current developments in securities law and related matters. Final Nasdaq Rule - In our October 2012 Bulletin, we discussed The NASDAQ Stock Exchange LLC’s...more

Skadden, Arps, Slate, Meagher & Flom LLP

Planning for the 2013 Annual Meeting and Reporting Season

by Andrew Brady, Brian V. Breheny, Marc S. Gerber, Richard J. Grossman, Neil M. Leff, Regina Olshan, Michael Rogan, Erica Schohn, Joseph M. Yaffe | Skadden, Arps, Slate, Meagher & Flom LLP on 2/19/2013

As companies prepare for the 2013 annual meeting and reporting season, we have compiled an overview of the corporate governance and disclosure matters that companies should consider as they draft this season’s disclosure...more

The Latest on Insider Trading: Directors and Executives Face Heightened Scrutiny Associated with Stock Trades Even under Rule...

by Wilson Sonsini Goodrich & Rosati on 2/6/2013

The aggressive use (or misuse) of Rule 10b5-1 trading plans is likely to become a significant area of focus for regulatory enforcement and securities class action plaintiffs. The floodlights now aimed at such plans are the...more

Legal Alert: One Shade of GRA: Proposed Regulations Foreshadow the End of the GRA Directive and Provide That "Available Upon...

by Eric Cayford, Robert S. Chase II, Jonathan Gardiner, Richard Hartnig, Daniel McKeithen, Michael Miles, Jennifer Molnar, William Pauls, Aaron Payne, Leni Perkins, Carol Tello | Sutherland Asbill & Brennan LLP on 2/5/2013

On January 30, Treasury and the IRS issued proposed regulations relating to the proper filing of gain recognition agreements (GRAs) and other related compliance obligations (the Proposed Regulations). As a general matter, a...more

D.C. Circuit Forces Banking Regulators To Revisit Order Barring Bank Director From Bank Activities

by BuckleySandler LLP on 2/5/2013

On January 29, the U.S. Court of Appeals for the D.C. Circuit held that the OCC and the Federal Reserve Board (FRB) improperly prohibited a bank director from participating in future banking activities of several institutions...more

Directors May Be Invested With Super Powers In Nevada But Not California

by Keith Paul Bishop | Allen Matkins Leck Gamble Mallory & Natsis... on 2/5/2013

Directors With Super Powers - Sometimes investors would like to endow one or more directors with greater voting powers. This is possible with a Nevada corporation by virtue of NRS 78.330(3) which provides “ The articles...more

"Don't Ask, Don't Waive" Standstill Provisions: Impermissible Limitation on Director Fiduciary Obligations or Legitimate,...

by David DiDonato, Janine Salomone, Peter Walsh | Potter Anderson & Corroon LLP on 2/5/2013

Under Revlon and its progeny, directors of Delaware corporations have a duty to take reasonable steps to ensure that stockholders receive the highest price reasonably available in a sale of the company. One way that target...more

Changes To D&O Questionnaires To Implement NYSE And Nasdaq Compensation Committee Independence Rules

by Jill Radloff | Leonard, Street and Deinard - Dodd-Frank and... on 2/4/2013

Both the NYSE and Nasdaq stock exchanges are requiring most issuers to have independent compensation committees by the earlier of their first annual meeting after January 14, 2014, or October 14, 2014. ...more

Communicate CEO Turnover

by Greentarget on 2/4/2013

More than any other company move, CEO successions form headlines, providing an important indication of an organization’s viability. Executive leadership changes have a profound effect not only on public perception, but on the...more

Are Charter Indemnification Provisions Contracts?

by Keith Paul Bishop | Allen Matkins Leck Gamble Mallory & Natsis... on 1/29/2013

Public companies typically include provisions in their articles and bylaws that mandate indemnification of directors and officers. Often, these provisions include a statement to the effect that the rights to indemnification...more

Indemnification Claims Under the CCAA A - Caution for Underwriters, Auditors, Directors and Others

by Denise Bright, David Phillips, Chris Simard | Bennett Jones LLP on 1/25/2013

Indemnification clauses are often considered a critical component of risk mitigation strategies in legal relationships. However, as is well understood, the value of an indemnification clause, in the event it becomes...more

TSX New Company Manual Rules Regarding Election Of Directors And Majority Voting Are Now Effective

by Elianeth Alicea | Dentons on 1/25/2013

On December 31, 2012, the recent amendments to the TSX Company Manual regarding director elections and majority voting became effective. Under the new rules, TSX-listed companies are required to...more

Segregated Portfolio Companies

by Louise Groom, Sean Scott | Harney Westwood & Riegels on 1/24/2013

Any Cayman Islands exempted company (the most common Cayman corporate vehicle limited by shares), including those to be established as funds, may be registered as a segregated portfolio company (an SPC). Registration as an...more

Environmental Crimes and Punishment

by Randall M. Lutz | Saul Ewing LLP on 1/24/2013

A few years ago the president of a well-known food brand was convicted and sentenced to serve nine months in federal prison for failing to stop his plant from engaging in a practice that he knew was a violation of...more

A Checklist To Comply With The New NYSE Compensation Committee Independence Rules

by Stephen M. Quinlivan | Leonard, Street and Deinard - Dodd-Frank and... on 1/17/2013

The SEC has approved the NYSE’s compensation committee independence rules. By July 1, 2013, most listed issuers must comply with the following...more

A Checklist To Comply With The New Nasdaq Compensation Committee Independence Rules

by Stephen M. Quinlivan | Leonard, Street and Deinard - Dodd-Frank and... on 1/17/2013

The SEC has approved Nasdaq’s compensation committee independence rules. By July 1, 2013, most listed issuers must comply with the following...more

"Executive Compensation and Benefits Alert: Annual Meeting Litigation: How to Prepare"

by Michael R. Bergmann, Emily Cabrera, Kristin M. Davis, Berit R. Freeman, Neil M. Leff, Barbara R. Mirza, Alessandra K. Murata, Timothy Nelson, Regina Olshan, David C. Olstein, Erica Schohn, more +Joseph M. Yaffe | Skadden, Arps, Slate, Meagher & Flom LLP on 1/17/2013

As the 2013 proxy season is now underway, companies should be aware of the recent wave of lawsuits alleging breaches of fiduciary duties by management and directors in connection with compensation-related decisions. These...more

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