Mintz - Securities & Capital Markets Viewpoints

The SEC’s (New) Admissions Policy: Questions and Consequences

Nearly a year has passed since the SEC announced that it would require admissions of wrongdoing as a condition of settling SEC charges in certain cases. Perhaps it can no longer be called a “new” policy. But lawyers are still…more

Administrative Hearings, Admissions of Liability, D&O Insurance, Department of Justice (DOJ), Securities and Exchange Commission (SEC)

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Caremark Liability Following the SEC’s New ESG Reporting Requirements

Recent developments in the Court of Chancery concerning a corporate board’s duty to monitor and provide oversight over a corporation’s operations, so-called Caremark claims, are likely to intersect with the Securities and…more

Caremark claim, Climate Change, Corporate Governance, DE Supreme Court, Disclosure Requirements

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Proposed Treasury Regulations Provide Guidance on Stock Buyback Excise Tax for Redemptions and M&A Transactions

On April 12, 2024, the Treasury Department and Internal Revenue Service (IRS) issued proposed Treasury Regulations (REG-115710-22) providing comprehensive guidance for applying the one-percent excise tax owed on corporate stock…more

Acquisitions, Excise Tax, Fair Market Value, Individual Retirement Account (IRA), Initial Public Offering (IPO)

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SEC Approves Nasdaq Rule Change on Reverse Stock Splits and Minimum Bid Price Compliance Timing

On October 7, 2024, the US Securities and Exchange Commission (SEC) approved a rule change proposed by The Nasdaq Stock Market LLC that affects companies utilizing reverse stock splits to regain compliance with Nasdaq’s minimum…more

Compliance, Equity, Listing Rules, Nasdaq, New Rules

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2021’s Continued SPAC Boom Invites Heightened SEC Scrutiny of SPAC Transactions

The ongoing surge in blank check acquisition transactions has invited heightened scrutiny from the Securities and Exchange Commission (SEC), which recently asked several underwriters to disclose information related to their…more

Initial Public Offering (IPO), Publicly-Traded Companies, Securities and Exchange Commission (SEC), Securities Regulation, Special Purpose Acquisition Companies (SPACs)

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IRS Releases Final Regulations Clarifying 162(m) Limitation on Compensation

Section 162(m) of the Internal Revenue Code precludes the deduction by public companies for compensation paid to certain covered employees in excess of $1,000,000 in any taxable year. This limitation on deduction does not apply…more

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Preparation for 2020 Fiscal Year-End SEC Filings and 2021 Annual Shareholder Meetings

As our clients and friends know, each year Mintz provides an analysis of the regulatory developments that impact public companies as they prepare for their fiscal year-end filings with the Securities and Exchange Commission (the…more

Annual Reports, Corporate Governance, Disclosure Requirements, Diversity and Inclusion Standards (D&I), Environmental Social & Governance (ESG)

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SEC Enforcement Director Discusses Issues for Pharmaceutical and Medical Technology Companies

In a wide-ranging speech on Tuesday, Securities and Exchange Commission Director of Enforcement Andrew Ceresney discussed recent SEC actions and current concerns involving the pharmaceutical and medical technology industries…more

Accounting Controls, Disclosure Requirements, Food and Drug Administration (FDA), Foreign Corrupt Practices Act (FCPA), Internal Controls

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SEC Harmonizes and Improves “Patchwork” Private Offering Framework

On November 2, the SEC adopted amendments designed to harmonize and simplify the existing, complicated framework of private offering exemptions—the primary method by which private companies raise capital. The amendments…more

Capital Formation, Crowdfunding, Exemptions, Investment, Private Offerings

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First Circuit Overturns SEC Commissioners’ Sanctions Order

As we have discussed before, the SEC’s increased use of in-house administrative proceedings in enforcement actions involving allegations of fraud has been a subject of considerable debate. Commentators have questioned the…more

Administrative Proceedings, Enforcement Actions, Materiality, Scienter, Securities and Exchange Commission (SEC)

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SEC Proposes Relief from Broker-Dealer Registration for Certain Finders

Today, the SEC published in the Federal Register a proposed notice of an exemptive order (the “Proposal”) that would, subject to limitations and conditions discussed below, exempt certain individuals seeking to find investors…more

Broker-Dealer, Exemptive Orders, Registration Requirement, Regulatory Requirements, Securities and Exchange Commission (SEC)

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Preserving Net Operating Losses (NOL) Carryforward: What Are You Doing to Protect Your Company’s Valuable Tax Assets?

A company’s past NOLs can be used to offset taxable income in future years, subject to certain limitations. For companies that have operated at a significant loss and expect to turn a profit in the foreseeable future, the…more

Carry Forward, Corporate Taxes, Life Sciences, Net Operating Losses, Publicly-Traded Companies

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A Brief Summary of the SEC’s Proposed Climate-Related Rules

On March 21, 2022, the Securities and Exchange Commission (“SEC”) unveiled its long-anticipated proposed rules on climate disclosures, entitled “The Enhancement and Standardization of Climate-Related Disclosures for Investors.”…more

Biden Administration, Climate Change, Corporate Governance, Disclosure Requirements, Environmental Social & Governance (ESG)

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The Public Weighs In On How the SEC Should Regulate ESG Disclosures

The past several years has seen growing attention on climate change disclosures and other environmental, social, and governance (“ESG”) issues. In 2016, a variety of universities faced pressure as student bodies demanded…more

Biden Administration, Climate Change, Compliance, Corporate Governance, Disclosure Requirements

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Goodyear’s Settlement with the SEC Emphasizes the Importance of FCPA Due Diligence in M&A Transactions and of Having a Robust Anti-Corruption Policy

On February 24, 2015, Goodyear Tire & Rubber Co. agreed to pay more than $16 million to settle charges that two of its subsidiaries allegedly paid $3.2 million in bribes that generated $14,122,535 in illicit profits. The SEC…more

Bribery, Compliance, Corruption, Due Diligence, Foreign Corrupt Practices Act (FCPA)

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Frequently Asked Questions for Private Companies Considering a Reverse Merger

*This piece appears in PitchBook’s 2023 Annual US VC Valuations Report. We believe this is the wrong question—we view a reverse merger as "going public" during your cross-over round, rather than as an alternative to an IPO..…more

Initial Public Offering (IPO), Jurisdiction, Liquidity, Mergers, Nasdaq

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Proxy Season Litigation Primer: Defending Shareholder Suits to Enjoin Annual Meetings for Allegedly Inadequate Disclosures Concerning Equity Compensation Plans

Over the past few years, as plaintiffs have found it increasingly harder to succeed in “say-on-pay” litigation, another type of litigation over proxy disclosures has been on the rise. These cases are generally brought as class…more

Board of Directors, Class Action, Equity Compensation, Executive Compensation, Fiduciary Duty

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Proposed Treasury Regulations Provide Guidance on Stock Buyback Excise Tax for Redemptions and M&A Transactions

On April 12, 2024, the Treasury Department and Internal Revenue Service (IRS) issued proposed Treasury Regulations (REG-115710-22) providing comprehensive guidance for applying the one-percent excise tax owed on corporate stock…more

Acquisitions, Excise Tax, Fair Market Value, Individual Retirement Account (IRA), Initial Public Offering (IPO)

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SEC Approves Nasdaq Rule Change on Reverse Stock Splits and Minimum Bid Price Compliance Timing

On October 7, 2024, the US Securities and Exchange Commission (SEC) approved a rule change proposed by The Nasdaq Stock Market LLC that affects companies utilizing reverse stock splits to regain compliance with Nasdaq’s minimum…more

Compliance, Equity, Listing Rules, Nasdaq, New Rules

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Caremark Liability Following the SEC’s New ESG Reporting Requirements

Recent developments in the Court of Chancery concerning a corporate board’s duty to monitor and provide oversight over a corporation’s operations, so-called Caremark claims, are likely to intersect with the Securities and…more

Caremark claim, Climate Change, Corporate Governance, DE Supreme Court, Disclosure Requirements

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SEC Approves Nasdaq Rule Change on Reverse Stock Splits and Minimum Bid Price Compliance Timing

On October 7, 2024, the US Securities and Exchange Commission (SEC) approved a rule change proposed by The Nasdaq Stock Market LLC that affects companies utilizing reverse stock splits to regain compliance with Nasdaq’s minimum…more

Compliance, Equity, Listing Rules, Nasdaq, New Rules

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Risk Management, Indemnification and D&O Coverage — Texas Wall Street Women Style

My colleagues Heidi Lawson, Dionne Lomax, and I just finished our tour of four Texas cities in as many days, meeting a lot of incredibly talented, smart, and fun Wall Street women (yes, and some men too) in San Antonio, Austin,…more

D&O Insurance, Indemnification, Liability Insurance, Risk Management

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Court Vacates SEC’s New Share Repurchase Disclosure Rules

On December 19, 2023, the US Court of Appeals for the Fifth Circuit vacated the Securities and Exchange Commission’s (SEC) share repurchase disclosure rules, which were adopted in May 2023 and became effective on July 31, 2023…more

Administrative Procedure Act, Appellate Courts, Disclosure Requirements, Equity Securities, Repurchases

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Using Corporate Bylaws and Charters to Set the Rules for Shareholder Litigation

Recent court decisions, including the Delaware Supreme Court’s opinion earlier this month in ATP Tour, Inc. v. Deutscher Tennis Bund, have focused new attention on the use of corporate bylaws and charters to establish the ground…more

American Rule, ATP Tours, Attorney's Fees, Board of Directors, Bylaws

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Spotlight On ESG Investing: The Importance of Understanding Environmental, Social and Governance Factors and Their Impact on Investing

The Corporation’s Role in Society - Today During the past several years, public companies have come under increasing pressure from investors and society at large to use their resources and influence for broad and meaningful…more

Business Plans, Climate Change, Corporate Governance, Corporate Social Responsibility, Environmental Social & Governance (ESG)

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Caremark Liability Following the SEC’s New ESG Reporting Requirements

Recent developments in the Court of Chancery concerning a corporate board’s duty to monitor and provide oversight over a corporation’s operations, so-called Caremark claims, are likely to intersect with the Securities and…more

Caremark claim, Climate Change, Corporate Governance, DE Supreme Court, Disclosure Requirements

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Massachusetts Federal Court Holds That LLC Operating Agreement Does Not Shield Defendants from Liability for Breaching Their Fiduciary Duties to Closely Held Corporations

A recent decision by Judge F. Dennis Saylor of the U.S. District Court for the District of Massachusetts, Butler v. Moore, C.A. No. 10-10207-FDS U.S. Dist. LEXIS 39416 (D. Mass. Mar. 26, 2015), offers an example of how fiduciary…more

Cell Towers, Closely Held Businesses, Corporate Governance, Fiduciary Duty, Limited Liability Company (LLC)

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First Circuit Strengthens “Traceability” Pleading Requirement for Section 11 Claims

A recent First Circuit decision raises the pleading bar for plaintiffs asserting violations of Section 11 of the Securities Act. Only would-be plaintiffs who acquired a security that is the direct subject of a prospectus and…more

Section 11, Securities Act, Securities Litigation

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California Board Diversity Statute Unconstitutional

On April 1, 2022, the Los Angeles County Superior Court granted summary judgment in favor of the plaintiff in Crest v. Padilla, a case challenging the constitutionality of Section 301.4 of the California Corporations Code, a…more

Appeals, California, Diversity and Inclusion Standards (D&I), Nasdaq, Penalties

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SEC Amends Shareholder Proposal Eligibility Rules

On September 23, 2020, the Securities and Exchange Commission (the “SEC”) finalized amendments to certain security ownership thresholds, procedural requirements, and resubmission thresholds under the shareholder proposal…more

Corporate Governance, Publicly-Traded Companies, Rule 14a-8, Securities and Exchange Commission (SEC), Securities Exchange Act

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2021’s Continued SPAC Boom Invites Heightened SEC Scrutiny of SPAC Transactions

The ongoing surge in blank check acquisition transactions has invited heightened scrutiny from the Securities and Exchange Commission (SEC), which recently asked several underwriters to disclose information related to their…more

Initial Public Offering (IPO), Publicly-Traded Companies, Securities and Exchange Commission (SEC), Securities Regulation, Special Purpose Acquisition Companies (SPACs)

See all updates »

Caremark Liability Following the SEC’s New ESG Reporting Requirements

Recent developments in the Court of Chancery concerning a corporate board’s duty to monitor and provide oversight over a corporation’s operations, so-called Caremark claims, are likely to intersect with the Securities and…more

Caremark claim, Climate Change, Corporate Governance, DE Supreme Court, Disclosure Requirements

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The OASB Annual Report to Congress for Fiscal Year 2020

In January 2019, the Office of the Advocate for Small Business Capital Formation (the “Office”) was formed “to advance the interests of small businesses and their investors at the SEC and in the capital markets.” These small…more

Capital Formation, Capital Markets, Coronavirus/COVID-19, Minority-Owned Businesses, Securities and Exchange Commission (SEC)

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Interactive Brokers LLC Submits to SEC, FINRA, and CFTC Penalties Totalling $38 Over Widespread AML Failures

Interactive Brokers LLC (“Interactive Brokers”) recently settled with three separate regulatory entities for a total of $38 million, without admitting or denying the findings. According to the SEC, Interactive Brokers failed to…more

Anti-Money Laundering, Bank Secrecy Act, Broker-Dealer, CFTC, Financial Industry Regulatory Authority (FINRA)

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Interactive Brokers LLC Submits to SEC, FINRA, and CFTC Penalties Totalling $38 Over Widespread AML Failures

Interactive Brokers LLC (“Interactive Brokers”) recently settled with three separate regulatory entities for a total of $38 million, without admitting or denying the findings. According to the SEC, Interactive Brokers failed to…more

Anti-Money Laundering, Bank Secrecy Act, Broker-Dealer, CFTC, Financial Industry Regulatory Authority (FINRA)

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New for 2024: Compliance with the Corporate Transparency Act Necessary for Many Mintz Clients

Reporting requirements under the Corporate Transparency Act (CTA) are in effect beginning January 1, 2024. Under the CTA, many US entities will be required to provide the personal information of their beneficial owners to the…more

Banks, Beneficial Owner, Compliance, Corporate Transparency Act, FinCEN

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You’ve Got Mail! Emails May Be Subject to Stockholder Books and Records Requests

Delaware corporations have always been required to provide certain information to their stockholders under Section 220 of the Delaware General Corporation Law (DGCL), but the scope and form of that information has naturally…more

Board of Directors, Books & Records, Breach of Duty, Business Judgment Rule, Capital Markets

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Upcoming Supreme Court Securities Cases

As the Supreme Court begins its 2014-15 term this month, it will be considering a number of securities cases, including the Omnicare case, which is scheduled for oral argument on November 3rd, and three other cases in which…more

Compliance, Omnicare, SCOTUS, Securities Litigation

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A Brief Summary of the SEC’s Proposed Climate-Related Rules

On March 21, 2022, the Securities and Exchange Commission (“SEC”) unveiled its long-anticipated proposed rules on climate disclosures, entitled “The Enhancement and Standardization of Climate-Related Disclosures for Investors.”…more

Biden Administration, Climate Change, Corporate Governance, Disclosure Requirements, Environmental Social & Governance (ESG)

See all updates »

Frequently Asked Questions for Private Companies Considering a Reverse Merger

*This piece appears in PitchBook’s 2023 Annual US VC Valuations Report. We believe this is the wrong question—we view a reverse merger as "going public" during your cross-over round, rather than as an alternative to an IPO..…more

Initial Public Offering (IPO), Jurisdiction, Liquidity, Mergers, Nasdaq

See all updates »

Proposed Treasury Regulations Provide Guidance on Stock Buyback Excise Tax for Redemptions and M&A Transactions

On April 12, 2024, the Treasury Department and Internal Revenue Service (IRS) issued proposed Treasury Regulations (REG-115710-22) providing comprehensive guidance for applying the one-percent excise tax owed on corporate stock…more

Acquisitions, Excise Tax, Fair Market Value, Individual Retirement Account (IRA), Initial Public Offering (IPO)

See all updates »

Proposed Treasury Regulations Provide Guidance on Stock Buyback Excise Tax for Redemptions and M&A Transactions

On April 12, 2024, the Treasury Department and Internal Revenue Service (IRS) issued proposed Treasury Regulations (REG-115710-22) providing comprehensive guidance for applying the one-percent excise tax owed on corporate stock…more

Acquisitions, Excise Tax, Fair Market Value, Individual Retirement Account (IRA), Initial Public Offering (IPO)

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Five Questions and Answers About the Second Circuit’s SEC v. Citigroup Decision

Last week we posted a summary of the Second Circuit’s decision in SEC v. Citigroup Global Markets, Inc. This week, as a follow-up, we pose the following five “yes or no” questions and provide responses as a way to further dive…more

Admissions of Liability, Citigroup, Judge Rakoff, Neither Admit Nor Deny Settlements, SEC v Citigroup

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Not So Fast: DOL Changes Course on Trump-Era ESG Investment Rule

The United States Department of Labor’s (“DOL”) Employee Benefits Security Administration (“EBSA”) announced on March 10, 2021 that it will not enforce certain final rules put into place under President Trump related to…more

401k, Biden Administration, Department of Labor (DOL), EBSA, Employee Retirement Income Security Act (ERISA)

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Caremark Liability Following the SEC’s New ESG Reporting Requirements

Recent developments in the Court of Chancery concerning a corporate board’s duty to monitor and provide oversight over a corporation’s operations, so-called Caremark claims, are likely to intersect with the Securities and…more

Caremark claim, Climate Change, Corporate Governance, DE Supreme Court, Disclosure Requirements

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Recent SEC Rules and Guidance Impose New Obligations on SPACs and Reverse Mergers

On January 24, 2024, the US Securities and Exchange Commission (SEC) adopted final rules relating to special purpose acquisition companies (SPACs) and other shell companies. The new rules are effective on July 1, 2024…more

Disclosure Requirements, Initial Public Offering (IPO), Investor Protection, New Guidance, New Rules

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Just How Scary is the SEC? “Fear” Not Sufficient Grounds to Duck Administrative Subpoena

A witness testifying under oath before the SEC recently refused to answer any questions directed to him, not because of any privilege, but rather — as he said, sixty-eight different times – because he was “scared” and…more

Bitcoin, Fifth Amendment, Ponzi Scheme, Securities and Exchange Commission (SEC), Self-Incrimination

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SEC Adopts Amendments to Section 13 Reporting Requirements

On October 10, 2023, as part of an effort to modernize beneficial ownership reporting requirements to align with today’s dynamic markets, the Securities and Exchange Commission (the “SEC”) announced the adoption of amendments to…more

Beneficial Owner, Compliance, Disclosure Requirements, EDGAR, Filing Deadlines

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2021’s Continued SPAC Boom Invites Heightened SEC Scrutiny of SPAC Transactions

The ongoing surge in blank check acquisition transactions has invited heightened scrutiny from the Securities and Exchange Commission (SEC), which recently asked several underwriters to disclose information related to their…more

Initial Public Offering (IPO), Publicly-Traded Companies, Securities and Exchange Commission (SEC), Securities Regulation, Special Purpose Acquisition Companies (SPACs)

See all updates »

2021’s Continued SPAC Boom Invites Heightened SEC Scrutiny of SPAC Transactions

The ongoing surge in blank check acquisition transactions has invited heightened scrutiny from the Securities and Exchange Commission (SEC), which recently asked several underwriters to disclose information related to their…more

Initial Public Offering (IPO), Publicly-Traded Companies, Securities and Exchange Commission (SEC), Securities Regulation, Special Purpose Acquisition Companies (SPACs)

See all updates »

A Brief Summary of the SEC’s Proposed Climate-Related Rules

On March 21, 2022, the Securities and Exchange Commission (“SEC”) unveiled its long-anticipated proposed rules on climate disclosures, entitled “The Enhancement and Standardization of Climate-Related Disclosures for Investors.”…more

Biden Administration, Climate Change, Corporate Governance, Disclosure Requirements, Environmental Social & Governance (ESG)

See all updates »

SEC Harmonizes and Improves “Patchwork” Private Offering Framework

On November 2, the SEC adopted amendments designed to harmonize and simplify the existing, complicated framework of private offering exemptions—the primary method by which private companies raise capital. The amendments…more

Capital Formation, Crowdfunding, Exemptions, Investment, Private Offerings

See all updates »

SEC Adopts Pay Versus Performance Compensation Disclosure Requirements

On August 25, 2022, the Securities and Exchange Commission (“SEC”) adopted rules that amend Item 402 of Regulation S-K to require reporting companies to disclose information detailing the relationship between a company’s…more

CD&A, Compensation, Corporate Net Income, Disclosure Requirements, Dodd-Frank

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Not So Fast: DOL Changes Course on Trump-Era ESG Investment Rule

The United States Department of Labor’s (“DOL”) Employee Benefits Security Administration (“EBSA”) announced on March 10, 2021 that it will not enforce certain final rules put into place under President Trump related to…more

401k, Biden Administration, Department of Labor (DOL), EBSA, Employee Retirement Income Security Act (ERISA)

See all updates »

A Brief Summary of the SEC’s Proposed Climate-Related Rules

On March 21, 2022, the Securities and Exchange Commission (“SEC”) unveiled its long-anticipated proposed rules on climate disclosures, entitled “The Enhancement and Standardization of Climate-Related Disclosures for Investors.”…more

Biden Administration, Climate Change, Corporate Governance, Disclosure Requirements, Environmental Social & Governance (ESG)

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Reminder – T-1 Settlement Starts Tuesday, May 28, 2024

Starting today, Tuesday, May 28, 2024, the amendments to Securities Exchange Act Rule 15c6-1 take effect, shortening the settlement cycle for most broker-dealer securities transactions to the trade date plus one business day…more

Bonds, Broker-Dealer, Financial Institutions, Financial Transactions, Limited Partnerships

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California Board Diversity Statute Unconstitutional

On April 1, 2022, the Los Angeles County Superior Court granted summary judgment in favor of the plaintiff in Crest v. Padilla, a case challenging the constitutionality of Section 301.4 of the California Corporations Code, a…more

Appeals, California, Diversity and Inclusion Standards (D&I), Nasdaq, Penalties

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SCOTUS Sets a Clock on Disgorgement in SEC Enforcement Actions

The U.S. Supreme Court’s recent decision in Kokesh v. SEC imposes a five-year statute of limitations on agency-sought disgorgement in SEC enforcement actions, resolving a Circuit split and definitively categorizing disgorgement…more

Disgorgement, Enforcement Actions, Kokesh v SEC, Penalties, SCOTUS

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