Many of the actions by the SEC over the past few years came following closely divided 3-to-2 votes. The split arose concerning both rulemaking by the Commission as well as enforcement actions....more
On January 10, 2025, the SEC announced settled charges against Vince McMahon, former Executive Chair and CEO of World Wrestling Entertainment Inc., for signing two settlement agreements without disclosure to the board, anyone...more
1/14/2025
/ Compliance ,
Corporate Governance ,
Corporate Misconduct ,
Disclosure Requirements ,
Enforcement Actions ,
Financial Reporting ,
Reporting Requirements ,
Sarbanes-Oxley ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
Settlement Agreements
After hearing argument earlier this month in a widely followed securities law case concerning risk-factor disclosures of public companies, the U.S. Supreme Court last week decided it should not have agreed to hear the case...more
11/27/2024
/ Class Action ,
Corporate Counsel ,
Corporate Governance ,
Data Breach ,
Disclosure Requirements ,
Dismissals ,
Enforcement Actions ,
Facebook ,
Petition for Writ of Certiorari ,
Risk Factors ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act
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
Last week, the SEC announced settled charges against 23 companies and individuals for failing to timely file Section 16 reports on Forms 3, 4 or 5.
Additionally, two public companies were charged for contributing to late...more
10/4/2024
/ Analytics ,
Corporate Governance ,
Enforcement Actions ,
Failure To Disclose ,
Filing Deadlines ,
Filing Requirements ,
Neither Admit Nor Deny Settlements ,
Publicly-Traded Companies ,
Required Forms ,
Securities and Exchange Commission (SEC) ,
Statutory Penalties
The U.S. Supreme Court recently agreed to hear an appeal of a Ninth Circuit decision that could have a significant impact on future securities fraud claims nationwide. At issue is how heavy a burden plaintiffs will bear in...more
As discussed in our September 1, 2021 post, the SEC brought its first “shadow insider trading” case against Matthew Panuwat, a company employee who purchased options in a competitor’s shares shortly after learning his...more
6/14/2024
/ Confidential Information ,
Corporate Governance ,
Criminal Convictions ,
Criminal Prosecution ,
Enforcement Actions ,
Insider Trading ,
Material Nonpublic Information ,
Materiality ,
Misappropriation ,
Publicly-Traded Companies ,
Risk Mitigation ,
Securities and Exchange Commission (SEC) ,
Securities Fraud
The U.S. Supreme Court has now resolved the split in lower courts, discussed in our March 14, 2024 post, over whether plaintiffs may bring a securities fraud claim based solely on a corporation’s omission from public filings...more
4/17/2024
/ Corporate Issuers ,
Disclosure Requirements ,
False Statements ,
Item 303 ,
Macquarie Infrastructure Corp v Moab Partners LP ,
Misleading Statements ,
Omissions ,
Regulation S-K ,
Rule 10b-5 ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act of 1934 ,
Securities Violations
Corporate executives know they must disclose in their companies’ financial statements trends or uncertainties affecting their business. Such disclosure is a requirement of Item 303 of SEC Regulation S-K....more
3/19/2024
/ C-Suite Executives ,
Corporate Governance ,
Disclosure Requirements ,
Enforcement Actions ,
Failure To Disclose ,
Material Misrepresentation ,
MD&A Statements ,
Misrepresentation ,
Publicly-Traded Companies ,
Regulation S-K ,
Rule 10b-5 ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Securities Litigation ,
Securities Regulation ,
Shareholder Litigation ,
Split of Authority
Amidst all the controversy and legal proceedings involving Elon Musk, one could overlook the fact that he and his company Tesla are on trial now in U.S. District Court for securities fraud. Yet they are: a jury has been...more
The SEC’s filing of its first shadow trading case earlier this month signals the agency’s willingness to pursue actions based on expanded theories of insider trading liability.
In a federal court complaint, the SEC on...more
Special purpose acquisition companies (“SPACs”), it seems, are everywhere. SPACs have been around for decades, but use of a SPAC to take a company public without a traditional initial public offering (“IPO”) has recently...more
The National Defense Authorization Act (“NDAA”) became law on January 1, 2021 after Congress overrode a presidential veto of the legislation. While the NDAA appropriates funds for defense-related activities and the...more
In its first enforcement action against a public company for misleading disclosures regarding COVID-19’s business impact, the SEC released a December 4 Order Instituting Proceedings against The Cheesecake Factory Inc. and...more
Liu v. Securities and Exchange Commission, the U.S. Supreme Court decision this week affirming the SEC’s right to seek disgorgement, displayed a striking consensus on the securities regulatory agency’s ability to seek...more
6/26/2020
/ 15 U.S.C. § 78u(d)(5) ,
Administrative Authority ,
Business Expenses ,
Calculation of Damages ,
Corporate Misconduct ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Kokesh v SEC ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Net Profits ,
Remedies ,
SCOTUS ,
Securities and Exchange Commission (SEC)
Federal, state and local law enforcement and consumer protection agencies have been issuing alerts and investigating cases regarding efforts by fraudsters to exploit the coronavirus crisis for profit. The SEC is taking...more
The U.S. Supreme Court yesterday rejected the Securities and Exchange Commission’s longtime method of appointing administrative law judges (ALJs) to hear actions brought by its enforcement division. In Lucia v. Securities and...more
6/22/2018
/ Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Appeals ,
Appointments Clause ,
Constitutional Challenges ,
Enforcement Actions ,
Final Written Decisions ,
Lucia v SEC ,
Officers of the United States ,
Remand ,
Reversal ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Special Trial Judges (STJs)
Stock traders who thought they could trade freely on gifts of inside information so long as the givers were not their close friends should rethink their strategy. The U.S. Court of Appeals for the Second Circuit this week...more
A five-year statute of limitations applies to actions by the Securities and Exchange Commission for disgorgement, the U.S. Supreme Court ruled today. The decision imposes a significant new limit on the SEC’s ability to seek...more
In a case with important consequences for SEC enforcement, the U.S. Supreme Court has agreed to address whether a five-year statute of limitations applies to SEC actions seeking disgorgement of ill-gotten gains.
Courts...more
A recent federal appellate decision casts new doubt on the SEC’s practice of using its own administrative law judges (ALJs) to hear actions brought by the SEC Enforcement Division.
In a decision late last month, the U.S....more
A federal appellate court recently held that the five-year statute of limitations in 28 U.S.C. § 2462 applies to actions by the Securities and Exchange Commission for declaratory relief and disgorgement. The decision extends...more