Law Commons^™

Proxy Access And Optimal Standardization In Corporate Governance: An Empirical Analysis, Reilly S. Steel

Fordham Journal of Corporate & Financial Law

According to the conventional wisdom, “one size does not fit all” in corporate governance. Firms are heterogeneous with respect to their governance needs, implying that the optimal corporate governance structure must also vary from firm to firm. This one-size-does-not-fit-all axiom has featured prominently in arguments against numerous corporate law regulatory initiatives, including the SEC’s failed Rule 14a-11—an attempt to impose mandatory, uniform “proxy access” on all public companies—which the D.C. Circuit struck down for inadequate cost–benefit analysis.

This Article presents an alternative theory as to the role of standardization in corporate governance—in which investors prefer standardized terms—and empirical …

A Novel Approach To Defining "Whistleblower" In Dodd-Frank, Ian A. Engoron

Fordham Journal of Corporate & Financial Law

Following the Financial Crisis of 2008, trust in the financial industry was at an all-time low as the American taxpayer was forced to bailout the very same institutions responsible for their suffering. In response, Congress passed Dodd-Frank in 2010 to ensure another crisis like 2008 never happen again. Section 78u-6 of the Act provides incentives and protections for whistleblowers who report violations of securities laws. In recent years there has been a divide among circuit courts over the question of whether employees who report violations internally to their bosses—and not directly to the SEC—are protected by the Act. Currently, the …

Morality And Securities Fraud, Jayme Herschkopf

Marquette Law Review

Securities fraud features prominently in conversations about financial reform, and for good reason. In addition to the disproportionate number of securities fraud lawsuits and government actions filed every year, securities fraud case law is frequently consulted as an analytical aid for other types of corporate fraud. And yet, in discussing the interpretation and application of the securities laws, scholars, judges, and lawmakers alike have largely overlooked a feature of securities fraud that could offer significant assistance in many challenging areas: namely, that securities fraud, including civil securities fraud, has a pronounced moral dimension.

This Article explores the role that moral …

When Is The ‘Force’ With A Securities Claim That Is ‘Brought To Enforce’ A Federal Securities Law?, Michelle Wellnitz

Journal of the National Association of Administrative Law Judiciary

No abstract provided.

A Compromise - Adding A Knowledge Requirement To Rule 13b2-2 Of The Securities Exchange Act Of 1934, Danielle K. Shaffer

Akron Law Review

The United States Securities and Exchange Commission (SEC) was established to protect investors and support fair and efficient financial markets. To combat bribery of foreign officials in the practice of business, the Foreign Corrupt Practices Act enacted Section 13(b) of the Securities Exchange Act of 1934. Generally, Section 13(b) establishes requirements for the financial records, internal controls, and accounting of public companies. Section 13(b) maintains stricter requirements for financial records for the public and SEC to easily detect illegal activity as well as to deter the companies from participating in these activities. Following the Sarbanes-Oxley Act of 2002, the SEC …

The Perfect Storm Is Brewing Once Again: What Scaling Back Dodd-Frank Will Mean For The Credit Default Swap, Daniel Isaacson

The Journal of Business, Entrepreneurship & the Law

The current presidential administration has expressed a concerted desire to “scale back” and even “get rid of” the Dodd–Frank Wall Street Reform and Consumer Protection Act (Dodd–Frank). Focusing specifically on Dodd–Frank’s regulation of the credit default swap (CDS), this Article explores two timely queries. First, whether Dodd–Frank’s regulatory response to these financial instruments is a justifiable one, and second, what effect a repeal may have. This Article will show that the “perfect storm” CDS—which contributed so significantly to the 2007–2010 financial crisis—flourished in a regulatory environment that contained two key weaknesses: (1) few restrictions on excessive speculation; and (2) the …

Titles Ii Or Iii: Where Will The Wisdom Of The Crowd Take Investors?, William P. Lane

Catholic University Law Review

Many small to moderate-sized businesses simply cannot afford the costs of the specialized accountants, underwriters, and attorneys necessary to meet the obligations that come with being a public company. To minimize these burdens recently approved regulations permit securities-based crowdfunding by certain private companies without registering the offering with the Securities and Exchange Commission.

On April 5, 2012, Congress passed, and President Barack Obama signed, the Jumpstart Our Business Startups Act (JOBS Act) into law. The goal of the JOBS Act was to increase job creation and economic growth by improving access to the markets. Along with other provisions, the JOBS …

To Be A "Whistleblower," Or Not To Be A "Whistleblower? " That Is The Question-Whether 'Tis Nobler In The Mind Of The Courts To Suffer For Reporting Wrongdoing To The Sec Or Employers Internally: Examining The Recent Circuit Split Regarding The Definition Of A Whistleblower Under Dodd-Frank, Luke I. Landers

The Journal of Business, Entrepreneurship & the Law

Under the current state of the law, the circuit courts are split over whether an employee must report corporate wrongdoing directly to the Securities and Exchange Commission (SEC), or report wrongdoing to a company’s management in order to receive whistleblower protection under Dodd–Frank. The resolution of this circuit split not only will have implications for American employees caught in situations similar to the fiction above, but also will provide a prime opportunity for the Supreme Court to clarify how courts are to understand the interpretive and deferential relationship between the language of legislative statutes and their corresponding bureaucratic regulations. In …

Clarifying The Original Clawback: Interpreting Sarbanes-Oxley Section 304 Through The Lens Of Dodd-Frank Section 954, J. Royce Fichtner, Patrick Heaston, Lou Ann Simpson

The Journal of Business, Entrepreneurship & the Law

In the early 2000s, major accounting scandals involving reporting violations and audit failures sent the United States financial markets into turmoil. Congress and President George W. Bush reacted to the controversy by passing the Public Company Accounting Reform and Investor Protection Act, better known as the Sarbanes–Oxley Act (SOX), in July of 2002. Section 304 created an explicit procedure, whereby the SEC could disgorge or clawback a CEO or CFO’s incentive-based compensation or stock gains when such profits were based on inflated financial statements later required to be restated to reflect the company’s true financial position. When the stock market …

If It Quacks Like A Duck: The Financial Industry Regulatory Authority And Federal Jurisdiction, Lesesne Phillips

Washington and Lee Law Review

No abstract provided.

Dictation And Delegation In Securities Regulation, Usha Rodrigues

Indiana Law Journal

When Congress undertakes major financial reform, either it dictates the precise con-tours of the law itself or it delegates the bulk of the rule making to an administrative agency. This choice has critical consequences. Making the law self-executing in federal legislation is swift, not subject to administrative tinkering, and less vulnerable than rule making to judicial second-guessing. Agency action is, in contrast, deliberate, subject to ongoing bureaucratic fiddling, and more vulnerable than statutes to judicial challenge.

This Article offers the first empirical analysis of the extent of congressional delegation in securities law from 1970 to the present day, examining nine …

The Potential Effect Of The Department Of Labor’S New Fiduciary Rule On Broker-Dealers And The Middle Income Retirement Investors Who Rely On Them, Nadia Yoon

Catholic University Law Review

On April 6, 2016, the U.S. Department of Labor issued a final rule aimed at increasing the reach of the definition of fiduciary status under the Employee Retirement Income Security Act of 1974 (ERISA). This rule closed a loophole that had allowed broker-dealers to avoid becoming investment advisers under ERISA, allowing them to provide bad advice to their retirement clients without disclosing material conflicts of interest. This note begins by laying out the fiduciary rules and standards under ERISA and the U.S. Securities and Exchange Commission’s oversight regime before the final rule. It then lays out the relevant details of …

Crowdfunding In Wonderland Issuer And Investor Risks In Non-Fraudulent Creative Arts Campaigns Under The Jobs Act, Michael M. Epstein, Nazgole Hashemi

American University Business Law Review

No abstract provided.

Where The Cco Fits In The C-Suite: A Corporation's Moral Compass, Alexander Foster

American University Business Law Review

No abstract provided.

The Seventeenth Annual A.A. Sommer, Jr. Lecture On Corporate, Securities And Financial Law At The Fordham Corporate Law Center, Matthew Diller, Ben Indek, Ira D. Hammerman

Fordham Journal of Corporate & Financial Law

No abstract provided.

How To Crowdfund And Not Fall Flat On Your Face: Best Practices For Investment Crowdfunding Offerings And The Data To Prove It, Zachary J. Robins, Timothy M. Joyce

Mitchell Hamline Law Review

No abstract provided.

To Fund Or Not To Fund: Deficiencies In The Wisconsin Crowdfunding Act That Hamper The Viaiblity Of Intrastate Crowdfunding, Andrew S. Hovestol

Marquette Law Review

"Crowdfunding," which is described as "the practice of . . . soliciting [financial] contributions from a large number of people especially from the online community," has recently taken the financial world by storm through the advent of websites like "Kickstarter," "Fundable," "IndieGogo," "Razoo," and "Appbackr." Such websites provide a marketplace whereby companies, small businesses, and entrepreneurs looking for startup capital can solicit funding from individual investors. The concept is relatively straightforward: project creators initiate a profile that includes informative bits like short videos, a brief synopsis of the project, and images to further showcase the project. Each project has a …

The Shadow Of Free Enterprise: The Unconstitutionality Of The Securities & Exchange Commission's Administrative Law Judges, Linda D. Jellum, Moses M. Tincher

SMU Law Review

Six years ago, Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), for the first time giving the Securities and Exchange Commission (SEC) the power to seek monetary penalties through its in-house adjudication. The SEC already had the power to seek such penalties in federal court. With the Dodd-Frank Act, the SEC’s enforcement division could now choose between an adjudication before an SEC Administrative Law Judge (ALJ) or a civil action before an Article III judge. With this new choice, litigants contended that the SEC realized a significant home-court advantage. For example, the Wall Street Journal …