On September 6, 2019, the SEC’s Division of Corporation Finance announced two notable revisions to its approach to handling no-action requests by companies seeking to exclude shareholder proposals under Rule 14a-8....more
On August 26, 2019, New York Governor Andrew Cuomo signed into law a significant change affecting New York’s blue sky law (the Martin Act), extending the period during which the Attorney General of New York can take action...more
It is common for investors in venture capital and private equity transactions, and in other investment arrangements, as a condition to their investment, to have rights to appoint board observers when director representation...more
The Securities and Exchange Commission (“SEC”) adopted Regulation FD (Fair Disclosure) in 2000 to help level the playing field among market participants by proscribing the selective disclosure of material nonpublic...more
On August 21, 2019, the SEC provided guidance to investment advisers, such as fund managers, regarding their proxy voting responsibilities. The SEC also concurrently issued an interpretative release regarding the...more
The SEC’s Inline XBRL requirements now apply to large accelerated filers. As registrants have started using Inline XBRL for their filings, a number of questions have come up. On August 20, 2019, the staff of the SEC’s...more
On July 29, 2019, the Delaware Court of Chancery dismissed an action against the directors of J.C. Penney Company, Inc. alleging failure of oversight because of the plaintiff’s failure to make a demand on the board before...more
In In re Towers Watson & Co. Stockholders Litigation, 2019 WL 3334521 (Del. Ch. July 25, 2019), the Delaware Court of Chancery applied the business judgment rule to dismiss a stockholder suit challenging the $18 billion...more
Venture capital and private equity arrangements often include contractual provisions limiting the rights of investors, including drag-along provisions in connection with future transactions approved by controlling...more
Exposure to claims for appraisal can be a significant risk in merger and acquisition transactions in which dissenter’s appraisal rights are available. This risk has increased in recent years as aggressive investors realized...more
On August 1, 2019, important amendments to the Delaware Limited Liability Company Act (the “LLC Act”) and the Delaware Revised Uniform Limited Partnership Act (the “LP Act”) will become effective. These amendments will...more
On July 12, 2019, the Securities and Exchange Commission (“SEC”) published a staff statement encouraging issuers and other market participants to actively manage their transition away from LIBOR and fully disclose the risks...more
On July 8, 2019, the staffs of the Division of Trading and Markets, U.S. Securities and Exchange Commission (“SEC”) and the Office of General Counsel, Financial Industry Regulatory Authority (“FINRA”) released a joint...more
A common provision in merger agreements is denial of the right of non-parties to the agreement to assert third-party beneficiary claims. The use of this provision left open the question whether stockholders of a disappearing...more
A recent Delaware Court of Chancery decision on a challenge to Goldman Sachs directors’ setting their own compensation is interesting because the court rejected the company’s attempt to make an end run around current law. The...more
On Tuesday, June 18, 2019, the SEC issued a Concept Release seeking comments on how to rationalize and simplify the framework governing exempt offerings in order to expand the opportunities for making investments while...more
The details of new tax rules are described in this Locke Lord Quick Study from our tax and finance colleagues. From a capital markets perspective, the new tax rules open up interesting possibilities.
For decades, companies...more
On May 29, 2019 in Shareholder Representative Services, LLC v. RSI Holdco, LLC, the Delaware Court of Chancery, by giving effect to a merger agreement provision, reemphasized the guidance it gave in Great Hill Equity Partners...more
On May 9, 2019, the SEC proposed rule changes to the disclosure requirements for smaller reporting companies (SRCs). Last year, the SEC expanded the number of companies that qualify for scaled disclosure accommodations under...more
On May 3, 2019, the SEC proposed rule amendments to financial information that investors receive regarding the acquisition and disposition of businesses. The SEC’s rules requiring target company and pro forma financial...more
On April 16, 2019, the Delaware Supreme Court, in a per curiam decision in Verition Partners Master Fund Ltd. v. Aruba Networks, Inc., reversed the Court of Chancery’s determination that the fair value of Aruba’s stock for...more
In Olenik v. Lodzinski, the Delaware Supreme Court found that the conditions required for business judgment review of a controlling stockholder transaction under the MFW standard were not in place “at the outset” of the...more
On March 27, 2019, the U.S. Supreme Court, in Lorenzo v. SEC, No. 17-1077 (2019), held that dissemination of false or misleading statements with intent to defraud violates Rules 10b–5(a) and (c) under the Securities Exchange...more
4/3/2019
/ Appeals ,
Enforcement Actions ,
False Statements ,
Fines ,
Intent to Defraud ,
Investment Banks ,
Lorenzo v SEC ,
Material Dissemination ,
Misleading Statements ,
Reaffirmation ,
Rule 10b-5 ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Suspensions
On March 20, 2019, the Securities and Exchange Commission (SEC) adopted amendments to modernize and simplify disclosure requirements for public companies, investment advisers, and investment companies. The amendments,...more
In a case with implications for director and officer protections, and of particular relevance to principals of private equity firms, the Delaware Superior Court recently denied two former directors coverage under a D&O...more