Securities Law Commons^™

Warning: Your Lcc Interest Might Be A Security, Wendy Gerwick Couture

Articles

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The Wreck Of Regulation D: The Unintended (And Bad) Outcomes For The Sec’S Crown Jewel Exemptions, Rutheford B. Campbell Jr.

Law Faculty Scholarly Articles

Regulation D is—or at least should be—the crown jewel of the Securities and Exchange Commission's regulatory exemptions from the registration requirements of the Securities Act of 1933. It offers businesses—especially businesses with relatively small capital requirements—fair and efficient access to vital, external capital.

In this article, I present data derived from deep samples of recent Form Ds filed with the Commission. The data show that Regulation D is not working in the way the Commission intended or in a way that benefits society The data reveal that companies attempting to raise relatively small amounts of capital under Regulation D overwhelmingly …

Making Sense Of The New Financial Deal, David A. Skeel Jr.

All Faculty Scholarship

In this Essay, I assess the enactment and implications of the Dodd-Frank Act, Congress’s response to the 2008 financial crisis. To set the stage, I begin by very briefly reviewing the causes of the crisis. I then argue that the legislation has two very clear objectives. The first is to limit the risk of the shadow banking system by more carefully regulating the key instruments and institutions of contemporary finance. The second objective is to limit the damage in the event one of these giant institutions fails. While the new regulation of the instruments of contemporary finance—including clearing and exchange …

Investors And Employees As Relief Defendants In Investment Fraud Receiverships: Promoting Efficiency By Following The Plain Meaning Of "Legitimate Claim Or Ownership Interest", Jared A. Wilkerson

W&M Law Student Publications

Relief defendants are nominal, innocent parties who hold funds traceable to the receivership but have no legitimate claim or ownership interest in them. These nominal parties, as opposed to full or primary defendants, have no cause of action asserted against them, and if they show no legitimate claim to the funds traced to the receivership, the funds are disgorged — generally at summary judgment. This seemingly simple relief defendant tool is used by receivers and regulatory agencies to quickly recover receivership funds for ultimate distribution to creditors. Recently, however, conflict has arisen in federal courts concerning the meaning of “legitimate …

Mismatch: The Misuse Of Market Efficiency In Market Manipulation Class Actions, Charles R. Korsmo

William & Mary Law Review

Plaintiffs commonly bring two distinct types of claims under section 10(b) of the Securities Exchange Act of 1934: (1) claims of material misrepresentations or omissions, and (2) claims of tradebased market manipulation. Despite the distinctive features of the two types of claims, courts have tended to treat them identically when applying the “fraud on the market” doctrine. In particular, courts have required both types of plaintiffs to make identical showings that the relevant security was traded in an “efficient market” in order to gain a presumption of reliance. The reasons for requiring such a showing by plaintiffs in a misrepresentation …

The Howey Test Turns 64: Are The Courts Grading This Test On A Curve?, Miriam R. Albert

William & Mary Business Law Review

Sixty-four years ago, the Supreme Court decided SEC v. W.J. Howey, crafting a definition for one form of security, known as an investment contract. The Supreme Court’s definition of investment contract in Howey is flexible, consistent with the Congressional approach to defining the broader concept of what constitutes a security. This choice of adopting a flexible definition for investment contract is not without cost, and raises the specter of inconsistent interpretation and/or application by the lower courts that threatens to undermine the utility of the Howey test itself as a trigger for investor protection. The intentional breadth and adaptability of …

The Tenth Annual Albert A. Destefano Lecture On Corporate, Securities & Financial Law. Corporate Accountability: Governance And Compensation Issues, Stanley Sporkin, Todd Lang, Gary Naftalis, Jeffrey Sonnenfeld, Louise Story

Fordham Journal of Corporate & Financial Law

CORPORATE ACCOUNTABILITY: GOVERNANCE AND COMPENSATION ISSUES

323 Non-Managing Underwriters’ Role In Securities Offerings: Just Eye Candy?, Elena Marty-Nelson

Fordham Journal of Corporate & Financial Law

While there is considerable scholarship on the due diligence defense of lead underwriters in defective corporate securities offerings, there is surprisingly little analysis of the due diligence defense of non-managing underwriters. This article challenges the common perception that lead and non-managing underwriters necessarily “sink or swim” together for purposes of due diligence. An analysis of the statutory structure of Section 11 of the Securities Act of 1933 reveals that non-managing underwriters are not inextricably tethered to the lead. Rather, non-managing underwriters who actively question the lead’s due diligence investigation should be able to meet their own affirmative defense even when …

Can Behavioral Economics Inform Our Understanding Of Securities Arbitration, Barbara Black

Faculty Articles and Other Publications

This paper contributes to the ongoing debate over FINRA arbitration by invoking behavioral economics principles to understand why PDAAs in securities arbitration continue to resist powerful market and political forces calling for their elimination.

Part II of the paper sets forth background information to put the issue in context. It first describes several important distinctions between securities arbitration and other forms of consumer arbitration. It next summarizes pertinent economic theory, first classical economic theory in support of PDAAs and then behavioral economics principles that challenge the classical approach.

Part III poses three questions regarding the staying power of PDAAs and …

Clearing And Trade Execution Requirements For Otc Derivatives Swaps Under The Frank-Dodd Wall Street Reform And Consumer Protection Act, Willa E. Gibson

Akron Law Faculty Publications

This paper examines Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act entitled the “Wall Street Transparency and Accountability Act of 2010” (the “Act”). The Act provides a comprehensive regulatory framework for swap transactions that designates the Commodities Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) as the primary regulators of the OTC derivatives swap market. The Act provides a very broad definition of swaps to include most OTC derivatives transactions, and it grants the CFTC regulatory jurisdiction over them with the exception of security-based swaps to which the SEC is granted regulatory jurisdiction. …

Clearing And Trade Execution Requirements For Otc Derivatives Swaps Under The Frank-Dodd Wall Street Reform And Consumer Protection Act, Willa E. Gibson

Willa E Gibson

This paper examines Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act entitled the “Wall Street Transparency and Accountability Act of 2010” (the “Act”). The Act provides a comprehensive regulatory framework for swap transactions that designates the Commodities Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) as the primary regulators of the OTC derivatives swap market. The Act provides a very broad definition of swaps to include most OTC derivatives transactions, and it grants the CFTC regulatory jurisdiction over them with the exception of security-based swaps to which the SEC is granted regulatory jurisdiction. …

Whoops - The Imminent Reconciliation Of U.S. Securities Laws With International Comity After Morrison V. National Australia Bank And The Drafting Error In The Dodd-Frank Act, Andrew Rocks

Villanova Law Review

The article contends that the Dodd-Frank Act and the case, Morrison v. National Australia Bank, restrict the extraterritorial reach of U.S. fraud laws to private rights of action involving domestic transactions of U.S. securities. The author notes that the U.S. legal jurisdiction is governed by the policy of minimal interference and respect for sovereignties and by the principle of comity. He states that this position will help establish a cooperative regulatory effort across global markets.