The Division of Corporation Finance published Staff Legal Bulletin No. 14J (CF) in order to provide guidance on issues arising under Rule 14a-8 under the Exchange Act.  SLB No. 14J expands on the types of factors that ought to be addressed in a board’s analysis of policy issues arising in connection with a no-action request on proposals that raise an issue that is “otherwise significantly related” to a company’s business, or that transcend ordinary business matters.  The Division notes in SLB 14J that the Division continues “to believe that a well-developed discussion of the board’s analysis of whether the particular policy issue raised by the proposal is otherwise significantly related to the company’s business, in the case of Rule 14a-8(i)(5), or is sufficiently significant in relation to the company, in the case of Rule 14a-8(i)(7), can assist the staff in evaluating a company’s no-action request.”  To that end, the Bulletin provides examples of factors that might be relevant to the analysis.  The Bulletin also provides additional insight regarding the “ordinary business” exception and the framework that will be applied in evaluating requests for relief as those relate to proposals implicating compensation matters.  See the full text here.

To read our Legal Update on the SEC Staff’s Legal Bulletin, click here.

Thursday, October 10, 2018
1:00 p.m. – 2:00 p.m. EDT

This webinar provides all the basics a lawyer needs to be conversant in and familiar with the Commodity Exchange Act and the regulatory framework for futures, commodity options, swaps, and retail foreign exchange. Partner Anna T. Pinedo and Partner Curtis A. Doty will discuss topics including:

  • The jurisdiction of the Commodity Futures Trading Commission (CFTC);
  • Who are the registrants and what authority does the CFTC have over them? What role do the Securities and Exchange Commission and other regulators have?;
  • The regulation of swaps post Dodd-Frank;
  • Commodity pool definition and status as a commodity pool operator; and
  • An overview of recent changes to swaps regulation.

PLI will provide CLE credit.

For more information, or to register, please visit the event website.

Recently, the Ninth Circuit held that only negligence, not scienter, is required to be shown where a violation of the tender offer provisions of Section 14(e) is alleged.  In Varjabedian v. Emulex Corp., the Ninth Circuit court remanded the case for reconsideration of the defendants’ motion to dismiss based on a negligence standard.  The District Court had previously dismissed the complaint for failure to plead a strong inference of scienter in connection with the alleged Section 14(e) violations.  The Ninth Circuit’s conclusion that only a negligence standard applies is at variance with decisions in various other circuits.  In reaching its conclusion, the Ninth Circuit relied on the legislative history of the Williams Act, which it stated is intended to be broad and address the quality of the information provided to stakeholders in a tender offer.  Perhaps the circuit split may at some point be addressed by the Supreme Court.