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Supreme Court Rejects Attempt to Erode Section 11 Requirements

Robert Stern — Fri, 02 Jun 2023 19:01:24 +0000

On June 1, the Supreme Court held in Slack Technologies v. Pirani that Section 11 of the Securities Act “requires a plaintiff to plead and prove that he purchased shares traceable to the allegedly defective registration statement,” endorsing the approach previously adopted by a majority of lower courts. The case stemmed from Slack’s 2019 direct listing of registered and unregistered shares. Pirani sued Slack under Section 11 of the Securities Act alleging that Slack included materially misleading statements in the registration statement. Slack moved to dismiss the complaint because the direct listing had included unregistered shares, and Pirani had not alleged that the shares he purchased were from the 118 million shares registered under the allegedly misleading registration statement, as opposed to the 165 million pre-existing and unregistered shares that were sold in the direct listing. The district court denied Slack’s motion to dismiss and the Ninth Circuit affirmed, holding that Pirani did not need to plead that his shares were traceable to Slack’s registration statement.

DOJ Focus on National Security Results in First Enforcement Actions by Disruptive Technology Strike Force

Patrick Wildes — Tue, 23 May 2023 19:08:59 +0000

A strategic shift is fully underway within federal law enforcement that seeks to use corporate criminal enforcement as a tool to advance United States national security and foreign policy objectives. Earlier this year, Deputy Attorney General Lisa Monaco announced a series of initiatives focused on addressing this growing trend, including the formation of the Disruptive […]

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Boeing Decision Underscores Need for Board Oversight of “Mission Critical” Product Safety Risks – And Documentation Demonstrating This Oversight

Stephen A. Radin — Mon, 13 Sep 2021 21:14:00 +0000

The Delaware Court of Chancery’s recent decision denying a motion to dismiss in In re The Boeing Company Derivative Litigation serves as a reminder to directors and their counsellors of the importance of board and board committee level oversight and monitoring of “mission critical” product safety risks – as well as the importance of documenting […]

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SEC Taking a Closer Look at Rule 10b5-1 Trading Plans on the Rulemaking and Enforcement Fronts: What Companies and Their Insiders Need to Know Now

Catherine Dixon — Wed, 16 Jun 2021 10:45:00 +0000

In remarks delivered June 7, 2021 to the Wall Street Journal’s CFO Network Summit, SEC Chair Gary Gensler (available here) (“Gensler June 7 Remarks”) highlighted areas of concern raised by the use of Rule 10b5-1 trading plans by insiders and companies alike, and signaled the possibility that regulatory solutions to these concerns loom on the […]

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DOJ to Apply FCPA Corporate Enforcement Policy to M&A

Public Company Advisory Group — Thu, 26 Jul 2018 15:13:28 +0000

In comments made today at an anti-corruption compliance conference, the Deputy Assistant Attorney General for the Criminal Division, Matthew S. Miner, announced plans to apply the Department of Justice’s Foreign Corrupt Practice Act Corporate Enforcement Policy to mergers and acquisitions. Mr. Miner announced that the agency’s goal was to incentivize acquirers to conduct post-closing due […]

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SEC Proposes Changes to Whistleblower Program

Public Company Advisory Group — Fri, 29 Jun 2018 19:33:01 +0000

Yesterday, the SEC released proposed changes to its Dodd-Frank whistleblower program, which compensates individuals who report violations of federal securities laws and protects those individuals from retaliation. The proposed changes would increase the SEC’s discretion to reward quality tips, clarify the definition of “whistleblower,” and improve processes for preventing and denying unmeritorious award applications. View […]

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DOJ Required to Produce to Media Organization Certain Information Related to Siemens AG Monitor

Public Company Advisory Group — Fri, 15 Jun 2018 13:25:20 +0000

Yesterday, a federal court in the District of Columbia ruled in 100Reporters LLC v. U.S. Dept. of Justice that, pursuant to a Freedom of Information Act (FOIA) request submitted by a media organization, DOJ must produce certain records related to the monitorship imposed on Siemens AG as part of its 2008 plea agreement to resolve […]

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Delaware Supreme Court Reaffirms The Importance Of Market Evidence In Appraisal Proceedings

Public Company Advisory Group — Mon, 18 Dec 2017 16:27:03 +0000

On December 14, 2017, the Delaware Supreme Court issued its much-anticipated decision in Dell, Inc. v. Magnetar Global Event Driven Master Fund Ltd., No. 565, 2016 (Del. Dec. 14, 2017), reversing and remanding the Delaware Court of Chancery’s post-trial decision finding that the “fair value” of Dell, Inc. was nearly $7 billion greater than the […]

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Ninth Circuit Broadly Interprets Anti-Retaliatory Provision of Dodd-Frank’s Whistleblower Protections

Public Company Advisory Group — Fri, 10 Mar 2017 13:12:53 +0000

The U.S. Court of Appeals for the Ninth Circuit held that the whistleblower anti-retaliation protections of the Dodd-Frank Act [DFA] extend to both internal reporters and those who report to the SEC. This differs from recent interpretations of the DFA’s protections for whistleblowers by some courts, and it appears the issue will remain unsettled pending […]

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New DOJ Guidance on Corporate Compliance Programs

Public Company Advisory Group — Thu, 23 Feb 2017 22:32:24 +0000

The U.S. Department of Justice’s Fraud Section recently released new guidance on corporate compliance programs. The new guidance continues the Department’s emphasis on examining the efficacy of corporate compliance programs when assessing corporate criminal liability, and provides a roadmap of the type of questions the DOJ believes companies should be considering. In this alert, we […]

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