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Securities Law Commons

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2018

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Articles 1 - 30 of 167

Full-Text Articles in Securities Law

The Howey Test: Are Crypto-Assets Investment Contracts?, Justin Henning Dec 2018

The Howey Test: Are Crypto-Assets Investment Contracts?, Justin Henning

University of Miami Business Law Review

With innovation always comes unknowns. Blockchain technology and crypto–assets are no different. Often times, innovators are so worried about getting their product to market or scaling at mass that they overlook the legal ramifications of their innovations. As Mark Zuckerberg infamously said, “move fast and break things.” Facebook was in no way alone in this style of innovation. However, with respect to crypto–assets, the SEC has stepped in and is attempting to prevent the “break things” aspect. One of the major issues relating to crypto–assets is that many people still do not understand what they are, or ...


Are Passive Index Funds Active Owners? Corporate Governance Consequences Of Passive Investing, Giovanni Strampelli Dec 2018

Are Passive Index Funds Active Owners? Corporate Governance Consequences Of Passive Investing, Giovanni Strampelli

San Diego Law Review

The exponential rise of mutual funds designed to track stock indices has been one of the drivers behind the re-concentration of ownership of listed companies in the United States. Because of the high concentration of the passive index funds industry, the three leading passive fund managers—BlackRock, Vanguard, and State Street—make up an increasingly important component of the shareholder base of listed companies. In spite of this however, it remains questionable whether they are actually interested in playing an active role in the corporate governance of investee companies. In fact, although passive investors are, by definition, focused on the ...


“I’Ll Know It When I See It”: Defending The Consumer Financial Protection Bureau’S Approach Of Interpreting The Scope Of Unfair, Deceptive, Or Abusive Acts Or Practices (“Udapp”) Through Enforcement Actions, Stephen J. Canzona Dec 2018

“I’Ll Know It When I See It”: Defending The Consumer Financial Protection Bureau’S Approach Of Interpreting The Scope Of Unfair, Deceptive, Or Abusive Acts Or Practices (“Udapp”) Through Enforcement Actions, Stephen J. Canzona

Journal of Legislation

No abstract provided.


A Critical Review Of U.S. Securities Laws And The Status Of Initial Coin Offerings: Potential Solutions For Issuers, Muhammed Kus Dec 2018

A Critical Review Of U.S. Securities Laws And The Status Of Initial Coin Offerings: Potential Solutions For Issuers, Muhammed Kus

Theses and Dissertations

Securities law in the United States has a unique approach to defining what is a security and what is not a security. It includes broadly defined terminology and describes several investment instruments that may be considered a security. Courts use one of two methods to determine whether an investment contract is a security: the Howey Test and the Risk Capital Test.

Initial Coin Offerings are one of the most recent instruments that courts and other governmental organizations need to examine in order to answer whether they meet the criteria of being a security. Depending on the result, the issuers may ...


Class Actions, Statutes Of Limitations And Repose, And Federal Common Law, Stephen B. Burbank, Tobias Barrington Wolff Dec 2018

Class Actions, Statutes Of Limitations And Repose, And Federal Common Law, Stephen B. Burbank, Tobias Barrington Wolff

Faculty Scholarship at Penn Law

After more than three decades during which it gave the issue scant attention, the Supreme Court has again made the American Pipe doctrine an active part of its docket. American Pipe addresses the tolling of statutes of limitations in federal class action litigation. When plaintiffs file a putative class action in federal court and class certification is denied, absent members of the putative class may wish to pursue their claims in some kind of further proceeding. If the statute of limitations would otherwise have expired while the class certification issue was being resolved, these claimants may need the benefit of ...


Investment Disputes Oltre Lo Stato: On Global Administrative Law, And Fair And Equitable Treatment, Sebastián López Escarcena Nov 2018

Investment Disputes Oltre Lo Stato: On Global Administrative Law, And Fair And Equitable Treatment, Sebastián López Escarcena

Boston College Law Review

Global Administrative Law is an academic project that attempts to describe the emergence of a regulatory space beyond the state and to prescribe solutions to the problems it diagnoses through certain normative principles like participation, transparency, reasoned decision-making, judicial review, accountability, proportionality, and legitimate expectations. In the case of investment treaty arbitration, the principles advanced by Global Administrative Law are akin to the constitutive elements of the fair and equitable treatment that international arbitral tribunals have identified in investor-state disputes. As classified by international law scholars, these constitutive elements of fair and equitable treatment include due process, arbitrariness, non-discrimination, vigilance ...


Should Investment Treaties Contain Public Policy Exceptions?, Caroline Henckels Nov 2018

Should Investment Treaties Contain Public Policy Exceptions?, Caroline Henckels

Boston College Law Review

The increasing inclusion of exceptions in newly concluded investment treaties, together with the divergent manner in which tribunals and annulment committees have approached these provisions, suggests that a greater understanding of their role and purpose is needed. In particular, the question whether exceptions operate as permissions or as defenses is a crucial but unaddressed issue that has significant implications for both litigation and practice and, in turn, implications for the stability of the regime. This Essay argues that as a starting point, exceptions should be understood as permissions that limit the scope of the substantive treaty obligations, and not as ...


Introduction: Investment Law For The Twenty-First Century, Frank J. Garcia, Sebastián López Escarcena Nov 2018

Introduction: Investment Law For The Twenty-First Century, Frank J. Garcia, Sebastián López Escarcena

Boston College Law Review

No abstract provided.


Third-Party Funding As Exploitation Of The Investment Treaty System, Frank J. Garcia Nov 2018

Third-Party Funding As Exploitation Of The Investment Treaty System, Frank J. Garcia

Boston College Law Review

Third-party funding of international investment arbitration is on the rise. Through TPF funders will cover the legal fees of investors filing claims under investment treaties in exchange for a portion of the arbitral award. Proponents of third-party funding claim that it provides access to justice for parties that normally would not have the funds to arbitrate against state actors. Given that the international investment law that governs these claims is unbalanced, and that funding only flows towards investor-claimants, and at the expense of states and their taxpayers, allowing third-party funding in investment arbitration risks creating unjustifiable wealth transfers from the ...


Balancing Sustainability, The Right To Regulate, And The Need For Investor Protection: Lessons From The Trade Regime, Elizabeth Trujillo Nov 2018

Balancing Sustainability, The Right To Regulate, And The Need For Investor Protection: Lessons From The Trade Regime, Elizabeth Trujillo

Boston College Law Review

Recent initiatives for investment reform demonstrated by the 2016 United Nations Conference on Trade and Development and 2018 World Investment Reports have raised key issues for sustainable development in the context of investment in natural resources and energy. Where there has been increasing convergence between trade and environmental norms as trade regimes confront domestic regulatory measures for environmental protection and climate change mitigation, similarly investment regimes also have had to address such domestic measures but with little progress towards normative convergence. At the same time, there’s an increasing skepticism for the traditional models of globalization of the 1990s and ...


Justice For All? Protecting The Public Interest In Investment Treaties, Alessandra Arcuri, Francesco Montanaro Nov 2018

Justice For All? Protecting The Public Interest In Investment Treaties, Alessandra Arcuri, Francesco Montanaro

Boston College Law Review

Investment arbitration has come increasingly under fire because of its design flaws. There is an emerging consensus that investment treaty arbitration not only falls short of ensuring a sufficient degree of transparency of arbitral proceedings and impartiality of arbitrators, but also that its institutional architecture is unjustifiably asymmetric, entrusting foreign investors with significant rights while no protection is afforded to the host states’ constituencies. In response to these criticisms, several states have attempted in recent years to reform the rules governing investor-state arbitration. A perusal of recently concluded international investment agreements, however, reveals that the reform efforts so far have ...


Avoiding The Planned Obsolescence Of Modern International Investment Agreements: Can General Exception Mechanisms Be Improved, And How?, Camille Martini Nov 2018

Avoiding The Planned Obsolescence Of Modern International Investment Agreements: Can General Exception Mechanisms Be Improved, And How?, Camille Martini

Boston College Law Review

In light of the increase in investor-state disputes brought by foreign investors under the arbitration clauses contained in international investment agreements (“IIAs”), treaty negotiators have started to develop safeguards in recent IIAs in an attempt to mitigate the impact of these agreements on their regulatory powers. General exception clauses modeled on Article XX of the General Agreement on Tariffs and Trade are part of these new treaty provisions. General exceptions clauses are, in their current form, a source of uncertainty rather than coherence. Recent arbitration cases have shed light on the unworkable enforceability requirements contained in general exceptions clauses, preventing ...


(Re)Calibration, Standard-Setting And The Shaping Of Investment Law And Arbitration, Eric De Brabandere Nov 2018

(Re)Calibration, Standard-Setting And The Shaping Of Investment Law And Arbitration, Eric De Brabandere

Boston College Law Review

Calibrating or (re)calibrating investment law and arbitration—depending on whether the exercise takes place for the first or a subsequent time—is different from rebalancing investment law and arbitration. A balancing exercise denotes a situation in which different elements are equal or in the correct proportions to maintain a sort of equilibrium. This Essay argues that investment law and arbitration are not necessarily about creating a situation in which all “elements” are in balance and that (re)calibrating is an interesting starting point for a discussion about the contemporary regime of investment law and arbitration, and especially to explore ...


Legitimacy Concerns Of The Proposed Multilateral Investment Court: Is Democracy Possible?, José Manuel Alvarez Zárate Nov 2018

Legitimacy Concerns Of The Proposed Multilateral Investment Court: Is Democracy Possible?, José Manuel Alvarez Zárate

Boston College Law Review

Growing concerns in Europe about international investment regimes and investor-state dispute settlement systems pushed the European Union into pursuing the creation of an investment court system and a multilateral investment court. The European Union started this reform through the Comprehensive Economic Trade Agreement, the Vietnam-EU Free Trade Agreement, and by direct persuasion of other countries to start negotiations at the United Nations Commission on International Trade Law. Visible reasons for the change include concerns over the perception of a lack of transparency, coherence, and arbitrators’ partiality, all of which diminish the legitimacy of the multilateral investment court. Other reasons might ...


Making Investment Arbitration Work For All: Addressing The Deficits In Access To Remedy For Wronged Host State Citizens Through Investment Arbitration, Emmanuel T. Laryea Nov 2018

Making Investment Arbitration Work For All: Addressing The Deficits In Access To Remedy For Wronged Host State Citizens Through Investment Arbitration, Emmanuel T. Laryea

Boston College Law Review

The current dominant system for resolving international investment disputes is the Investor-State Dispute Settlement system or, more precisely, the Investor-State Arbitration system (ISA). The ISA system has proved to be an effective avenue for remedy for foreign investors whose investments are wrongfully impaired by host states. However, the system is not accessible to Host State Citizens (HSCs) whose interests may be harmed by investors. Wronged HSCs can seek redress in domestic fora only. The domestic fora in many jurisdictions leave many wronged HSCs without remedy, a problem that has long been acknowledged. This Essay proposes a solution. It proposes that ...


Expansive Disclosure: Regulating Third-Party Funding For Future Analysis And Reform, Rachel Denae Thrasher Nov 2018

Expansive Disclosure: Regulating Third-Party Funding For Future Analysis And Reform, Rachel Denae Thrasher

Boston College Law Review

Third-party funding (TPF) is a relatively new phenomenon in the field of international investment arbitration. TPF takes place when a non-party to a dispute provides funding to one of the parties (usually the claimant) in return for a percentage of the amount recovered. International investment arbitration is a unique context, however, because investor-states dispute settlement puts States always in the role of respondent and private investors in the role of claimants. Despite this apparent imbalance, TPF proponents argue, among other things, that it provides much needed access to justice for poorer clients and adds value to the system by providing ...


Investment Treaties, Offshore Finance, And The Resource Curse, Karl M.F. Lockhart Nov 2018

Investment Treaties, Offshore Finance, And The Resource Curse, Karl M.F. Lockhart

Boston College Law Review

Questions of how best to understand offshore financial centers (“OFCs”)—countries that have low or zero tax rates, strong banking secrecy regulation, and easy-to-form legal entities—and what, if anything, the international community should do about them remain fixed on the agenda of national and international discourse. This Essay seeks to provide a new theoretical perspective on tax havens and applies this perspective to the cross-border legal regimes that govern international investment. This new analytical framework sees offshore financial centers as countries that are victims of the “resource curse,” as that term is described in economic development literature. Often physically ...


Greening Investor-State Dispute Settlement, Daniel B. Magraw, Sergio Puig Nov 2018

Greening Investor-State Dispute Settlement, Daniel B. Magraw, Sergio Puig

Boston College Law Review

Climate change poses serious threats to human society. Climate change is already affecting our environment and thus, many aspects of human and economic activity. Among the challenges ahead, governments will need to more actively adopt regulatory policies given the international obligations in this area, such as the Paris Agreement, as well as promote green private investment as a means toward unlocking sustainable growth. How can international investment law be adapted and modernized to respond to these challenges? In this Essay, we summarize a comprehensive set of innovations that could be included in International Investment Agreements to address international obligations regarding ...


Reforming International Investment Law: Opportunities, Challenges, Paradigms, Frank J. Garcia, Leo Gargne, Eric De Brabandere, Rachel Denae Thrasher, William Park Nov 2018

Reforming International Investment Law: Opportunities, Challenges, Paradigms, Frank J. Garcia, Leo Gargne, Eric De Brabandere, Rachel Denae Thrasher, William Park

Boston College Law Review

Transcription of a panel discussion.


Law Library Blog (November 2018): Legal Beagle's Blog Archive, Roger Williams University School Of Law Nov 2018

Law Library Blog (November 2018): Legal Beagle's Blog Archive, Roger Williams University School Of Law

Law Library Newsletters/Blog

No abstract provided.


Securities Law In The Sixties: The Supreme Court, The Second Circuit, And The Triumph Of Purpose Over Text, A.C. Pritchard, Robert B. Thompson Nov 2018

Securities Law In The Sixties: The Supreme Court, The Second Circuit, And The Triumph Of Purpose Over Text, A.C. Pritchard, Robert B. Thompson

Notre Dame Law Review

This Article analyzes the Supreme Court’s leading securities cases from 1962 to 1972—SEC v. Capital Gains Research Bureau, Inc.; J.I. Case Co. v. Borak; Mills v. Electric Auto-Lite Co.; Superintendent of Insurance v. Bankers Life & Casualty Co.; and Affiliated Ute of Utah v. United States—relying not just on the published opinions, but also the Justices’ internal letters, memos, and conference notes. The Sixties Court did not simply apply the text as enacted by Congress, but instead invoked the securities laws’ purposes as a guide to interpretation. The Court became a partner of Congress in shaping the securities laws ...


Securities Law In The Sixties: The Supreme Court, The Second Circuit, And The Triumph Of Purpose Over Text, Adam C. Pritchard, Robert B. Thompson Nov 2018

Securities Law In The Sixties: The Supreme Court, The Second Circuit, And The Triumph Of Purpose Over Text, Adam C. Pritchard, Robert B. Thompson

Articles

This Article analyzes the Supreme Court’s leading securities cases from 1962 to 1972—SEC v. Capital Gains Research Bureau, Inc.; J.I. Case Co. v. Borak; Mills v. Electric Auto-Lite Co.; Superintendent of Insurance v. Bankers Life & Casualty Co.; and Affiliated Ute of Utah v. United States—relying not just on the published opinions, but also the Justices’ internal letters, memos, and conference notes. The Sixties Court did not simply apply the text as enacted by Congress, but instead invoked the securities laws’ purposes as a guide to interpretation. The Court became a partner of Congress in shaping the securities laws ...


Disgorgement In Insider Trading Cases: Fy2005-Fy2015, Verity Winship Oct 2018

Disgorgement In Insider Trading Cases: Fy2005-Fy2015, Verity Winship

SMU Law Review

For about 50 years—at least since Texas Gulf Sulphur—the SEC has ordered defendants to disgorge their profits from transactions that violated the securities laws. Despite disgorgement’s long history, in its 2017 opinion in Kokesh v. SEC, the U.S. Supreme Court put two aspects of the remedy on the table. It applied a five-year statute of limitations to disgorgement. It also reopened old questions about agencies’ power to seek remedies not specified in statute. This article provides data to inform these debates over the agency’s use of disgorgement and the effects of Kokesh. It reports the ...


A Birthday Toast To Texas Gulf Sulphur, Manning G. Warren Iii Oct 2018

A Birthday Toast To Texas Gulf Sulphur, Manning G. Warren Iii

SMU Law Review

This article commemorates the fiftieth anniversary of the Second Circuit’s Texas Gulf Sulphur decision by examining the impact of the case on insider trading law in the United States. The author begins by discussing the SEC’s opinion, In the Matter of Cady, Roberts & Co., which laid the foundation for the Texas Gulf Sulphur decision by creating a federal duty to disclose material nonpublic information or abstain from trading securities. The author then posits that the SEC, in its Cady, Roberts decision, rejected judicially developed common law fiduciary duty to disclose based on trust and confidence, and, by administrative ...


The Coasian Firm And Insider Trading, Revisited, James C. Spindler Oct 2018

The Coasian Firm And Insider Trading, Revisited, James C. Spindler

SMU Law Review

I present an economic model of insider trading building upon Haddock & Macey’s classic analysis of trading by the manager of a Coasian firm (i.e., a firm in which agency costs do not exist). Due to current shareholders’ status as expected sellers of shares, Coasian insider trading allows shareholders to expropriate outsiders via the managerial proxy and any signaling value of insider trading is eliminated by shareholders’ biased incentives. Adverse selection results. If a system of credible disclosure exists, an insider trading ban results in more disclosure, more efficient prices, and lower illiquidity costs. While the case for insider ...


Unintended Consequences: The Link Between Judge Friendly’S Texas Gulf Sulphur Concurrence And Recent Supreme Court Decisions Misconstruing Rule 10b-5, Margaret V. Sachs Oct 2018

Unintended Consequences: The Link Between Judge Friendly’S Texas Gulf Sulphur Concurrence And Recent Supreme Court Decisions Misconstruing Rule 10b-5, Margaret V. Sachs

SMU Law Review

In his Texas Gulf Sulphur concurrence, Judge Henry J. Friendly coun- seled the federal district courts concerning the numerous pending satellite class actions that had been filed under Section 10(b) of the Securities Ex- change Act and Rule 10b-5. In the course of so doing, he argued forcefully that private Rule 10b-5 litigation should be curtailed. Finding his argument convincing, the Supreme Court issued four major decisions restricting the Rule between 1975 and 1994, while nonetheless expanding it in Basic Inc. v. Levinson. Congress responded by blessing both aspects of the Court’s jurisprudence – imposing its own set of ...


Texas Gulf Sulphur And The Genesis Of Corporate Liability Under Rule 10b-5, Adam C. Pritchard, Robert Thompson Oct 2018

Texas Gulf Sulphur And The Genesis Of Corporate Liability Under Rule 10b-5, Adam C. Pritchard, Robert Thompson

SMU Law Review

This Essay explores the seminal role played by SEC v. Texas Gulf Sulphur Co. in establishing Rule 10b-5’s use to create a remedy against corporations for misstatements made by their officers. The question of the corporation’s liability for private damages loomed large for the Second Circuit judges in Texas Gulf Sulphur, even though that question was not directly at issue in an SEC action for injunctive relief. The judges considered both, construing narrowly “in connection with the purchase or sale of any security,” and the requisite state of mind required for violating Rule 10b-5. We explore the choices ...


The Statutory Authority For Court-Ordered Disgorgement In Sec Enforcement Actions, Donna M. Nagy Oct 2018

The Statutory Authority For Court-Ordered Disgorgement In Sec Enforcement Actions, Donna M. Nagy

SMU Law Review

What empowers the U.S. Securities and Exchange Commission to seek, and federal district courts to order, the disgorgement of ill-gotten gains from securities law violators? The short answer, which stood virtually un- challenged for nearly forty-six years, is that federal courts may award disgorgement, at the request of the SEC, pursuant to the broad equitable powers that Congress conferred in the jurisdictional provisions of the federal securities laws. During the 2017 oral argument in Kokesh v. SEC, however, five Justices of the U.S. Supreme Court interjected statements ex- pressing varying degrees of skepticism. The tenor of the questions ...


Taming Rule 10b-5-1: The Unfinished Business Of Texas Gulf Sulphur, Daniel J. Morrissey Oct 2018

Taming Rule 10b-5-1: The Unfinished Business Of Texas Gulf Sulphur, Daniel J. Morrissey

SMU Law Review

Insider trading has shaped both the evolution of the Securities Exchange Commission (SEC) and the current state of securities law. The injustice of insider trading, especially as felt by everyday shareholders and investors, mandated action by government regulators. Consequently, the SEC enacted Rule 10b-5—a prohibition and prosecution on any corporate officials’ use of material, non-public information for private profit. In SEC v. Texas Gulf Sulphur Co., Rule 10b-5 grew into the sanction on insider trading that it is known as today. As case law whet Rule 10b-5’s reach on in- sider trading, corporate executives became increasingly concerned that ...


Martoma And Newman: Valid Corporate Purpose And The Personal Benefit Test, Jonathan R. Macey Oct 2018

Martoma And Newman: Valid Corporate Purpose And The Personal Benefit Test, Jonathan R. Macey

SMU Law Review

The law of insider trading in the United States is fundamentally grounded on a theory of property rights in information. Those to whom property rights in information have been allocated may trade without violating the prohibitions on trading contained in § 10(b) of the Securities Ex- change Act. Similarly, those who use material, nonpublic information for a valid corporate purpose have not violated the law. On the other hand, those who pilfer for personal gain material inside information belonging to a corporation do so at their legal peril. Those with property rights in inside information may authorize others to trade ...