Securities Law Commons^™

Getting The Most Out Of Extractive Industries Transparency: How A More Explicit Treatment Of Political Considerations Could Strengthen The Impact Of Transparency Efforts, Columbia Center On Sustainable Investment

Columbia Center on Sustainable Investment Staff Publications

Work on transparency in the extractive industries (EI) has achieved important successes over the last two decades. For example, significant commitments to disclosure have been secured, the volume of publicly available information about critical activities has increased considerably, and norms around certain information being in the public domain have been established. There is also a growing library of use cases for this information. Nonetheless, important work remains to be done to translate these efforts into impact.

Political context is crucial to determining the fate of transparency efforts. Therefore, grappling with political context more effectively will also be key to unlocking …

Federal Forum Provisions And The Internal Affairs Doctrine, Dhruv Aggarwal, Albert H. Choi

Law & Economics Working Papers

A key question at the intersection of state and federal law is whether corporations can use their charters or bylaws to restrict securities litigation to federal court. In December 2018, the Delaware Chancery Court answered this question in the negative in the landmark decision Sciabacucchi v. Salzberg. The court invalidated “federal forum provisions” (“FFPs”) that allow companies to select federal district courts as the exclusive venue for claims brought under the Securities Act of 1933 (“1933 Act”). The decision held that the internal affairs doctrine, which is the bedrock of U.S. corporate law, does not permit charter and bylaw provisions …

Utility Token Offerings: Can A Security Transform Into A Non-Security?, Scott W. Maughan

BYU Law Review

No abstract provided.

The Case For Preempting State Money Transmission Laws For Crypto-Based Businesses, Carol R. Goforth

Arkansas Law Review

Few industries are evolving as rapidly or as dramatically as those involving payment systems. The recent advent and spread of cryptocurrencies and associated trading platforms and exchanges, as well as ongoing improvements and innovations in FinTech generally, ensure that this is going to continue for the foreseeable future. Along with this rapid change has come a dynamic increase in the number and range of payment startups, a development that has been recognized as likely to redound to the benefit of consumers and the broader economy. The problem is simply that regulation is not keeping up with innovation.

Virtual Currency As Crypto Collateral Under Article 9 Of The Ucc: Trying To Fit A Square Peg In A Round Hole, Sharon E. Foster

Arkansas Law Review

This Article addresses the current state of academic discussion regarding the problems of creating an enforceable security interest under Article 9 of the Uniform Commercial Code (UCC) using virtual currency, such as bitcoin, as collateral. While academic discussion is helpful and, indeed, may one day be adopted by a court and become law, the primary problem in using virtual currency as collateral is the uncertainty regarding using Article 9 to create an enforceable security interest in virtual currency. Simply put, Article 9 does not specifically address virtual currency as collateral, and we have no case law at this time to …

New Things Under The Sun: How The Cftc Is Using Virtual Currencies To Expand Its Jurisdiction, James Michael Blakemore

Arkansas Law Review

A decade has passed since Bitcoin solved a fundamental problem plaguing virtual currencies: How to ensure, without resort to financial intermediaries or other trusted central authorities, that a unit of digital currency can be spent only once. In that time, Bitcoin has inspired countless follow-on projects. Some have attempted to improve the technology’s potential use for digital cash, by, for example, increasing the number of transactions processed per second or improving user privacy. Others have strayed further from Bitcoin’s original intent, building on blockchain—Bitcoin’s central innovation—to enable distributed computing and so-called smart contracting, decentralized lending, governance, data storage, and digital …

Marginal Benefits Of The Core Securities Laws, Kevin S. Haeberle

Popular Media

No abstract provided.

Working Hard Or Making Work? Plaintiffs' Attorneys Fees In Securities Fraud Class Actions, Stephen J. Choi, Jessica Erickson, A. C. Pritchard

Articles

In this article, we study attorney fees awarded in the largest securities class actions: “mega- settlements.” Consistent with prior work, we find larger fee awards but lower percentages in these cases. We also find that courts are more likely to reject or modify fee requests made in connection with the largest settlements. We conjecture that this scrutiny provides an incentive for law firms to bill more hours, not to advance the case, but to help justify large fee awards—“make work.” The results of our empirical tests are consistent with plaintiffs’ attorneys investing more time in litigation against larger companies, with …

Federal Forum Provisions And The Internal Affairs Doctrine, Dhruv Aggarwal, Albert H. Choi, Ofer Eldar

Articles

A key question at the intersection of state and federal law is whether corpo- rations can use their charters or bylaws to restrict securities litigation to federal court. In December 2018, the Delaware Chancery Court answered this question in the negative in the landmark decision Sciabacucchi v. Salzberg. The court invalidated “federal forum provisions” (“FFPs”) that allow companies to select federal district courts as the exclusive venue for claims brought under the Secur- ities Act of 1933 (“1933 Act”). The decision held that the internal affairs doc- trine, which is the bedrock of U.S. corporate law, does not permit charter …

Profiteering Off Public Health Crises: The Viable Cure For Congressional Insider Trading, Charles L. Slamowitz

Washington and Lee Law Review Online

This article takes an approachable, forward-thinking, and academic dive into congressional insider trading in the wake of the coronavirus (COVID-19) pandemic. After a confidential briefing by the Senate Health Committee warned of COVID-19, massive stock sell-offs by members of Congress and their spouses suddenly ensued. Some senators even publicly disparaged COVID-19’s viral effects while their own shares were being offloaded. By the time the American people were made aware of its dangers, vast investment holdings by congressional insiders had already been sold. Shockingly, it is unclear if congressional insiders trading on confidential coronavirus information are actually breaking the law. Congress …

The New Insider Trading, Karen E. Woody

Scholarly Articles

Pursuant to the SEC’s Rule 10b-5, in order to obtain a conviction for insider trading based upon a tipper-tippee theory, the government must prove that the tipper received a personal benefit for the tip, and that the tippee knew about that benefit. The last five years of blockbuster insider trading cases have focused on this seemingly nebulous personal benefit test, and the Supreme Court has been unable to clear the muddy waters. As a result, the parameters of insider trading remain hard to pin down and often shift depending on the facts of the most recent case. Two terms ago, …

Stakeholder Survey Preliminary White Paper, Program In The Law And Economics Of Capital Markets, Columbia-Ibm Center For Blockchain And Data Transparency

Program in the Law and Economics of Capital Markets

With a generous grant from the Columbia-IBM Center for Blockchain and Data Transparency, the Columbia Law School/Business School Program in the Law and Economics of Capital Markets (the “Program”) is conducting a survey of domestic and international securities markets regulators, entrepreneurs, private industry leaders, legal practitioners, academics, and other stakeholders in the securities markets (the “Survey”). The Survey is designed to provide a deeper understanding of what these stakeholders consider to be the most important issues raised by distributed ledger technology (“DLT”) for the securities markets and their regulation. DLT is an integral part of the larger revolution in computing, …

Incorporating Free, Prior And Informed Consent (Fpic) Into Investment Approval Processes, Kelly Dudine, Sam Szoke-Burke

Columbia Center on Sustainable Investment Staff Publications

Investment approval processes are the gateway through which governments set the agenda for their country’s investment environment. Yet too often these processes fail to incorporate meaningful requirements regarding participation in decision-making by Indigenous and other affected communities, increasing the risk of under-performing and conflict-ridden investments.

Enabling meaningful participation by rights holders and obtaining and maintaining their Free, Prior and Informed Consent (FPIC) throughout different investment approval processes can help governments to fulfill their legal obligations, mitigate financial and political risk, and, ultimately, attract more sustainable land-based investments.

Featuring concrete guidance and drawing on case studies from Kenya, Liberia, Mexico, Peru, …

Modern Provisions In Investment Treaties, Jesse Coleman

Columbia Center on Sustainable Investment Staff Publications

Governments are pursuing substantive and procedural reform of the international investment regime in recognition that there are fundamental, systemic, and interrelated concerns about current approaches to investment governance, and that current approaches have failed to meet their purported objectives.

A vast majority of the 1,023 publicly-known treaty-based claims have been brought under “old-generation” treaties. In 2018, for example, 60% of such claims were brought under treaties originally concluded in the 1990s or earlier, and all but one was filed under a pre-2011 treaty. These old-generation treaties include vague and far-reaching obligations for states, generally do not include any reference to …

Investment Promotion And Facilitation For Sustainable Development, Brooke Guven

Columbia Center on Sustainable Investment Staff Publications

Investment is a critical component of sustainable development. In particular, under the right conditions, foreign direct investment (FDI) can improve economic growth and living standards, create jobs, transfer technology and know-how and result in supply chain upgrading. However, its benefits are not automatic, and, if not carefully governed, investment can result in harm to the environment, labour standards and lead to tax evasion or other undesirable outcomes. Investment promotion and investment facilitation, in turn, can help states attract, expand and retain FDI.

Submission To Bonsucro Re Production Standard V5 (2019-21), Nami Patel, Sam Szoke-Burke

Columbia Center on Sustainable Investment Staff Publications

In July 2020, CCSI made a formal submission to Bonsucro, an international multi-stakeholder initiative and certification scheme concerned with promoting sustainable sugar cane production. The submission formed part of consultations for Bonsucro’s draft Production Standard version 5. CCSI’s submission focused on challenges associated with implementing, and auditing for compliance with, three aspects of Bonsucro’s draft standard, namely:

• Obtaining the free, prior and informed consent (FPIC) of Indigenous and traditional communities when establishing or expanding sugar production operations
• Implementing transparent and participatory processes to assess, monitor, and evaluate the environmental and social impacts of new and existing projects; and
• Establishing accessible …

Adversarial Failure, Benjamin P. Edwards

Washington and Lee Law Review

Investors, industry firms, and regulators all rely on vital public records to assess risk and evaluate securities industry personnel. Despite the information’s importance, an arbitration-facilitated expungement process now regularly deletes these public records. Often, these arbitrations recommend that public information be deleted without any true adversary ever providing any critical scrutiny to the requests. In essence, poorly informed arbitrators facilitate removing public information out of public databases. Interventions aimed at surfacing information may yield better informed decisions. Although similar problems have emerged in other contexts when adversarial systems break down, the expungement process to purge information about financial professionals provides …

The Abraham L. Pomerantz Lecture: Investor Protection In The Digital Age, Kara M. Stein

Brooklyn Law Review

On September 24, 2019, Kara M. Stein delivered the following keynote address at the 17th annual Abraham L. Pomerantz Lecture at Brooklyn Law School. The Pomerantz Lecture is sponsored by the Brooklyn Law Review and the Center for the Study of Business Law and Regulation at Brooklyn Law School. Kara M. Stein served as Commissioner of the U.S. Securities and Exchange Commission (SEC) from August 9, 2013 until January 2, 2019. Commissioner Stein was appointed by President Barack Obama and confirmed unanimously by the U.S. Senate.

Unmasking The Villain: Exposing Scammers’ Identities To Defeat Harmful Calls, Katherine Teng

Brooklyn Journal of Corporate, Financial & Commercial Law

Since 1991, Congress has attempted to limit unwanted phone calls through legislative efforts. However, past and current laws remain ineffective as scam call complaints continue to increase while the harm of these calls remains severe. Currently, the laws affecting telecommunication regulation focus on reactive measures rather than preventative solutions. Most recently, Congress has passed the Telephone Robocall Abuse Criminal Enforcement and Deterrence Act, which will require telecommunication companies to implement SHAKEN/STIR technology to end scam calls before they reach consumers. While this is the most progressive legislation addressing scam calls, this Note will suggest that phone numbers be registered to …

“Estonia’S Gift To The World”: The Implementation Of A Blockchain Protocol For Corporate Governance In New York, Sydney Lauren Abualy

Brooklyn Journal of Corporate, Financial & Commercial Law

The traditional procedures of corporate governance are not designed to resolve issues related to close outcomes of corporate votes, empty voting practices, the proxy voting protocol, verification of shareholder identities, and access to corporate records. Blockchain technology allows all corporate shareholders to participate in corporate governance more conveniently, with increased transparency, on a secure network. Estonia sought to revolutionize corporate governance by facilitating the development of a blockchain based e-voting protocol for shareholders of companies listed on the Tallinn Stock Exchange to vote in shareholder meetings. After unsuccessful attempts, New York stands well behind other states, such as Delaware, in …

Revising The Debt Limit For “Small Business Debtors”: The Legislative Half-Measure Of The Small Business Reorganization Act, Michael C. Blackmon

Brooklyn Journal of Corporate, Financial & Commercial Law

Bankruptcy law changed drastically in 2019 with the passage of several bills. This Note will examine two of them. First, the Family Farmer Relief Act of 2019 raised the debt limit of the family farmer from $4,411,400 to $10,000,000. This enables more financially distressed family farmers to be eligible for Chapter 12 relief, a reorganizational tool designed for farmers. Second, the Small Business Reorganization Act of 2019 created Subchapter V – Small Business Debtor Reorganization in Chapter 11. This new Subchapter streamlined the reorganization process for small business debtors by removing roadblocks which often derail a reorganization of a small …

A Taxonomy Of Cryptocurrency Enforcement Actions, Peter J. Henning

Brooklyn Journal of Corporate, Financial & Commercial Law

This article looks at how the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ) have pursued cases involving cryptocurrencies. A number of prosecutions have been brought against defendants who misled investors into believing that they were obtaining cryptocurrencies when in fact there were simply false statements and schemes to defraud, such as Ponzi schemes. When a company has attempted to issue a cryptocurrency to investors, the SEC has relied on Section 5(a) and 5(c) of the Securities Act of 1933 to require that issuers file a registration statement with the Commission. This is not an easy process …

Session 6: Innovating The Built Environment Post-Covid-19, Marc Palatucci, Richard Lyall, Timothy Harris, Steven Bender, Peter Smirniotopoulos, Ryan Mathesin

SITIE Symposiums

ABSTRACT: Innovating the Built Environment for a Post-COVID-19 World

It would seem an act of academic malpractice to teach a course titled Innovating the Built Environment: How the Law Responds to Disruptive Change, and host an all-day symposium as an integral part of that course, and not endeavor to address the most-disruptive thing to happen to the built environment in more than 100 years: The coronavirus pandemic. This "disruption" to real estate is the proverbial elephant in the room. Hopefully, it will maintain a minimum six-foot distance from others as we address how it impacts the four Special Topics …

Session 5: Real Estate Tokenization, Joseph Vincent, Steven Bender, Peter Smirniotopoulos

SITIE Symposiums

ABSTRACT: Is “tokenization” the next great leap forward needed to make homeownership more appealing to Millennials and Gen Z’s?

If single-family homeownership and time-sharing had a love child, what would it look like? Is it possible to adapt successful models for office sharing to homeownership so renters who lament not owning an appreciating asset could have a stake in “something” while not being tied down to one specific residential structure or a single geographic location, to make homeownership more attractive to younger generations? And, if so, does blockchain technology hold the key (pun intended) to fractional ownerships in real …

Session 4: Atlanta Beltline, Art Lansing, Rob Turner, Jim Langford, Kristen Lohse, Claire Martini

SITIE Symposiums

ABSTRACT: What Would it Take to Connect All of Greater Seattle’s Neighborhoods with Walking and Biking Trails?

Major U.S. cities have endeavored, independently of each other, over the past several decades to create greenway systems connecting residents and visitors with neighborhoods and attractions, increasing opportunities for walking and biking and reducing their reliance on vehicular traffic. Atlanta’s BeltLine--a twenty-two-mile loop of historic railroad right-of-ways encircling the city’s downtown and midtown areas, seeks to reinvent the city if transformed into a green corridor—is perhaps one of the best examples of how a Seattle Greenway might be accomplished (although Atlanta’s concerted …

Session 3: Virtual Luncheon Session, Student Submissions

SITIE Symposiums

A Working Lunch brainstorming discussion, moderated by Professor Smirniotopoulos, to discuss “What Comes Next?” in the context of Innovating the Built Environment: How the Law Responds to Disruptive Change.

Registered students in Prof. Smirniotopoulos’s Innovating the Built Environment course will take one-to-two minutes each to present their initial project ideas for their Final Projects in the course, as well as outlining and moderating a discussion of the Challenges and Opportunities presented by their ideas. Symposium participants are encouraged to set up lunch in front of their computers and participate actively in discussing each student’s project idea, providing relevant …

Session 2: Wework, Ryan Mathisen, Peter Smirniotopoulos, Paul Swegle

SITIE Symposiums

ABSTRACT: When Worlds Collide: How an 86-Year Old Federal Law (The Securities Act of 1933) Exposed the Flaws in WeWork’s “Innovative Business Model.”

Co-working pioneer WeWork, a wholly owned subsidiary of The We Company, grew meteorically through an extremely aggressive building and master-lease acquisition strategy over the past several years. Substantial, early stage funding from SoftBank, a Japan-based high-tech venture capital investment bank, reinforced WeWork’s unicorn status. But was WeWork’s business model truly unique, bringing with it the promise of a very profitable real estate operating company in the future? Or was it the company’s early stage, venture …

Session 1: Crew Seattle Presentation, Emily Alvarado, Jeanne Marie Coronado, Tory Laughlin Taylor, Colin Morgan-Cross

SITIE Symposiums

ABSTRACT: Is there Still a Place in Seattle for the Single-Family Detached Housing Typology, Given the Acute Need for Affordable Housing?

This expert panel will explore the intersection between existing zoning laws and well-established neighborhood patterns of development, on the one hand, and the acute need for the increased production and availability of affordable housing, in the greater Seattle area, including in and near the City of Seattle’s Central Business District, as well as other close-in employment centers, on the other hand. The genesis of this Special Topic in the Innovating the Built Environment SITIE2020 course came out of …

Opening Session, Annette Clark, Steven Bender, Peter Smirniotopoulos

SITIE Symposiums

The SITIE2020 Symposium: Innovating the Built Environment was offered entirely online, through the Zoom platform. Each of six (6) symposium sessions, outlined below, were offered in a continuous Zoom session with breaks throughout the day, allowing our audience to select those sessions of greatest interest to them. Students enrolled in Professor Smirniotopoulos’s Summer Institute course—Innovating the Built Environment: How the Law Responds to Disruptive Change—participated all day.

Proceedings Of The Sitie2020 Symposium, Seattle Journal Of Technology, Environmental, And Innovation Law

SITIE Symposiums

Complete Summary of Proceedings.