The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 weighs in at a robust 2,300 pages in length, and likely two or three that amount of printed or on-screen pages of coverage and analysis have been devoted to its provisions. A fraction of those pages of coverage and analysis have been devoted to the law’s provisions that relate to the corporate governance of all U.S. public companies. But these provisions, which increase shareholder participation and expand disclosure requirements, may have more immediate impact on free enterprise and economic conduct than any other part of the law.
This morning, Washington Legal Foundation broadcast its latest Web Seminar program, The 2011 Public Company Proxy Season: The Playing Field after Dodd-Frank and Strategies to Manage More Active Shareholders, featuring two Weil, Gotshal & Manges LLP partners, Holly J. Gregory and Catherine T. Dixon (both pictured above). The on-demand video of the seminar can be accessed here. The set of slides Ms. Gregory and Ms. Dixon devised for their presentations are here.
The timing of the Web Seminar was rather fortuitous, since just yesterday the Securities and Exchange Commission issued proposed rules on two critical Dodd-Frank shareholder access provisions: the non-binding “say-on-pay” shareholder vote on executive compensation and the advisory vote on compensation arrangements arising out of merger transactions, a.k.a. ”golden parachute” arrangements. The deadline for submitting comments on those proposals is November 18. Ms. Dixon devoted some of her presentation to the details of these proposals.
- Beware “tech” companies: A judge may use your tech savvy against you if you violate federal discovery rules (New York Law Journal)
- Does search and advertising giant’s entry into “free” phone services raise privacy regulatory issues? (Computerworld)
- A hostile legal environment means “the next big thing will not be invented here,” says Intel CEO (CNET)
- SCOTUS’s Honest Services Fraud rulings have immediate impact (WSJ Law Blog)
- SEC expands shareholder activists’ power. Prof. Larry Ribstein wonders, “now what?” (Truth on the Market)
- Wal-Mart asks SCOTUS to hear appeal of its 9th Circuit class action loss (SCOTUSblog) (WLF’s 9th Cir. amicus brief)
- A $38 quadrillion lawsuit? Really? (Overlawyered)
- Court rules in key battle between generic and branded drug makers over bioequivalence (FDA Law Blog)
- Russell Bruesewitz, et al., v. Wyeth, Inc. f/k/a Wyeth Laboratories, et al.,
On July 30, 2010, WLF filed a brief in the U.S. Supreme Court, urging it to affirm the Third Circuit Court of Appeals’ ruling that the National Childhood Vaccine Injury Act preempts state tort claims against vaccines for design defects.
The Legal Pulse
- “Mass or Class? – Misreading the Law or Simply Not Reading It?: Eleventh Circuit Panel Subverts CAFA.” By Cory Andrews.
- “FTC Chairman Challenged in Congress Over Commission Tactics in “Pay-for-Delay” Investigation.” By Glenn Lammi.
- “Move by State Attorneys General on “Street View” Exemplifies Online Privacy Compliance Challenges.” By Glenn Lammi.
Cross-posted at Forbes.com’s “On the Docket”
Two weeks ago, Pfizer Inc. was hit with a stockholder derivative lawsuit in a Delaware court, arising out of its September 2009 settlement of federal allegations that it improperly promoted several of its drugs. The filing was hardly surprising. Other shareholder derivative suits motivated by the federal settlement have been filed against Pfizer, and several have been consolidated in a New York federal court. Many of the largest pharmaceutical companies have been pressured into settling charges that they violated one or more of the bewilderingly vague federal drug promotion rules, and enterprising plaintiffs’ lawyers routinely view such settlements as an opportunity to profit from the companies’ misfortune.
But if lawyers stopped to take a closer look at their legal theory, they would realize that such stockholder derivative suits stand little chance of success – unless success is measured as the ability to extort settlement payments from litigation-averse corporations. Stockholder derivative suits are intended to allow a corporation to recover funds from unfaithful directors, not to punish directors for the wrongdoing of corporate employees. Continue reading