Citing recent DEI developments in the U.S., ISS released its Statement on Diversity Factors in Director Elections on February 11, 2025 announcing that it will “indefinitely halt consideration of certain diversity factors in...more
2/14/2025
/ BlackRock ,
Board of Directors ,
Corporate Governance ,
Diversity ,
Environmental Social & Governance (ESG) ,
Institutional Shareholder Services (ISS) ,
Investors ,
Nasdaq ,
Proxy Voting ,
Shareholders ,
Vanguard
On December 11, in a 9-8 ruling, the Fifth Circuit invalidated the SEC’s approval of the Nasdaq board diversity rule in Alliance for Fair Board Recruitment v. SEC. Invoking the “major questions” doctrine, the court ruled the...more
Recently, the SEC announced settled charges against a former chairman/CEO and director of Church & Dwight Co. Inc., for violating proxy disclosure rules by standing for election as an independent director without informing...more
10/8/2024
/ Board of Directors ,
Civil Monetary Penalty ,
Corporate Officers ,
Directors ,
Disclosure Requirements ,
Enforcement Actions ,
Failure To Disclose ,
Independent Directors ,
Proxy Statements ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Regulation
On July 18, 2024, District Court Judge Engelmayer of the Southern District of New York issued his 107-page opinion and order dismissing most – but not all – of the landmark allegations of the SEC against SolarWinds Corp. and...more
7/29/2024
/ Board of Directors ,
Chief Information Security Officer (CISO) ,
Corporate Governance ,
Cyber Attacks ,
Cybersecurity ,
Data Breach ,
Disclosure Requirements ,
Enforcement Actions ,
Fraud ,
Incident Response Plans ,
Misleading Statements ,
Popular ,
Publicly-Traded Companies ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
SolarWinds
One of the routine duties of counsel for a public company is advising officers and directors on their trades in company stock and their SEC responsibilities when they leave. Because those discussions are routine, it may be...more
5/22/2024
/ 10b5-1 Plans ,
Blackout Rules ,
Board of Directors ,
Compliance ,
Corporate Governance ,
Corporate Officers ,
Employee Retirement Income Security Act (ERISA) ,
Filing Requirements ,
Insider Trading ,
Material Nonpublic Information ,
Publicly-Traded Companies ,
Risk Management ,
Rule 144 ,
Securities Regulation
The Delaware Chancery Court invalidated a substantial equity award to Elon Musk – the largest in history. It applied the entire fairness test instead of the more deferential business judgment rule, finding that Musk...more
2/15/2024
/ Board of Directors ,
Breach of Duty ,
Business Judgment Rule ,
Compensation Committee ,
Disclosure Requirements ,
EBITDA ,
Elon Musk ,
Entire Fairness Standard ,
Equity Compensation ,
Executive Compensation ,
Fiduciary Duty ,
Majority Shareholders ,
Shareholders ,
Tesla
A claim for breach of the duty of oversight is known as a Caremark claim, after the landmark Delaware Court of Chancery decision in In re Caremark International Inc. Derivative Litigation (1996). Since then, Delaware courts...more
4/26/2023
/ Bad Faith ,
Board of Directors ,
Breach of Duty ,
Caremark claim ,
Corporate Officers ,
Derivative Suit ,
Duty of Loyalty ,
Duty of Oversight ,
Exculpatory Clauses ,
Fiduciary Duty ,
Sexual Harassment
As discussed in our November 17, 2021 post, management of public companies are required to use universal proxy cards for shareholder meetings involving most election contests held after August 31, 2022. This means that both...more
9/1/2022
/ Board of Directors ,
Bylaws ,
Corporate Governance ,
Disclosure Requirements ,
New Rules ,
Nominee Directors ,
Proxy Season ,
Proxy Voting ,
Publicly-Traded Companies ,
Securities and Exchange Commission (SEC) ,
Shareholder Meetings ,
Shareholders ,
Universal Proxy ,
Universal Proxy Cards
All Nasdaq-listed companies must now disclose a board diversity matrix by the later of (1) August 8, 2022, or (2) the date the company files its proxy statement for the 2022 annual meeting of shareholders (or, if companies do...more
8/12/2022
/ Board of Directors ,
Corporate Governance ,
Diversity ,
Diversity and Inclusion Standards (D&I) ,
Form 10-K ,
Form 20-F ,
Listing Rules ,
Minorities ,
Nasdaq ,
Proxy Statements ,
Publicly-Traded Companies ,
Woman Board Members
It has now been 20 years since the historic collapse of WorldCom, Inc. (“WorldCom” or the “Company”). A review of the WorldCom collapse yields some continuing lessons for corporate counsel....more
7/26/2022
/ Attorney-Client Privilege ,
Board of Directors ,
Corporate Management ,
Fiduciary Duty ,
Internal Controls ,
Privileged Communication ,
Risk Management ,
Shareholder Approval ,
Stock Trades ,
WorldCom ,
Written Consent
In our November 2, 2021 blog post, we highlighted a number of considerations for the 2022 proxy season. Based on recent developments, the following are some additional items...more
1/21/2022
/ Board of Directors ,
Climate Change ,
Coronavirus/COVID-19 ,
Corporate Governance ,
Disclosure Requirements ,
Equity Compensation ,
Glass Lewis ,
Independent Directors ,
Institutional Shareholder Services (ISS) ,
Proxy Season ,
Proxy Statements ,
Securities and Exchange Commission (SEC)
Yesterday the SEC approved new proxy rules requiring the use of universal proxy cards by management and shareholders soliciting proxy votes for their candidates in non-exempt director election contests, as well as mandating...more
11/19/2021
/ Board of Directors ,
Corporate Governance ,
Nominee Directors ,
Proxy Advisors ,
Proxy Season ,
Proxy Voting Guidelines ,
Publicly-Traded Companies ,
Securities and Exchange Commission (SEC) ,
Shareholder Meetings ,
Shareholder Votes ,
Shareholders
The SEC’s Division of Corporation Finance recently published Legal Bulletin 14L (CF) (the “Bulletin”) providing updated guidance on excluding shareholder proposals under Rule 14a-8 under the Exchange Act. Specifically, the...more
11/15/2021
/ Board of Directors ,
Climate Change ,
Corporate Governance ,
Environmental Social & Governance (ESG) ,
New Guidance ,
Ordinary Business Exception ,
Proxy Materials ,
Proxy Season ,
Publicly-Traded Companies ,
Rule 14a-8 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Shareholder Proposals ,
Shareholders
The SEC today approved Nasdaq’s board diversity proposal, which will require each Nasdaq-listed company to publicly disclose information on the voluntary self-identified gender and racial characteristics and LGBTQ+ status of...more
On Friday, Nasdaq submitted a revised proposal that addresses board diversity membership for listed companies. As discussed in our prior alert, Nasdaq had originally called for public companies - over a two-to-four year...more
3/2/2021
/ Amended Rules ,
Black and Minority Ethnic (BME) ,
Board of Directors ,
Corporate Governance ,
Disclosure Requirements ,
Diversity ,
Ethnicity ,
Gender Identity ,
Nasdaq ,
Popular ,
Proposed Rules ,
Securities and Exchange Commission (SEC) ,
Sexual Orientation
A recent decision by the Delaware Court of Chancery highlights risks for outside directors in using third-party email systems when communicating about confidential company matters. In that case, the court ruled that...more
Nasdaq yesterday announced a proposed new listing rule that would require all Nasdaq-listed companies to publicly disclose consistent, transparent board diversity statistics in a specified form of matrix. In addition, the...more
As the pandemic and racial unrest continue in 2020, companies should consider whether to update their D&O questionnaires to gather information in response to the growing pressure for voluntary diversity disclosures from...more
SEC Penalizes Company for Non-Compliance with Equal or Greater Prominence Requirement in Earnings Releases -
In late December, the SEC settled its first “equal or greater prominence” enforcement action under its non-GAAP...more
3/11/2019
/ #MeToo ,
Board of Directors ,
CD&A ,
Corporate Governance ,
Corporate Social Responsibility ,
Disclosure Requirements ,
EBITDA ,
Equal Employment Opportunity Commission (EEOC) ,
Equity Compensation ,
GAAP ,
Gender Equity ,
Hedging ,
Institutional Shareholder Services (ISS) ,
PCAOB ,
Proxy Season ,
Publicly-Traded Companies ,
Securities and Exchange Commission (SEC)