Corporate governance and backdating of executive stock options
Rather, the Solicitor General now agreed with the petitioner in Lucia that ALJs are inferior officers of the United States and their appointment must be in compliance with the Appointments Clause. The following day, the SEC issued an order “ratif[ying] the agency’s prior appointment of” all of its ALJs, and ordering the ALJs to reconsider the record in all pending proceedings in which an initial decision has not yet been rendered, or in which the initial decision was issued but not yet considered on appeal by the Commission. While the SEC’s pronouncement deemed that the order had “resolved any concerns,” the core issue of whether the ALJs had been constitutionally appointed in the first place, and whether there are any repercussions for past or pending cases, remains open, and the Supreme Court may nonetheless opt to grant certiorari in Lucia and/or Bandimere.
excluding follow-on sanctions orders and actions to deregister public companies with delinquent filings), a nearly 20% decline from the prior year’s high of 548 new standalone cases.And while the SEC did institute proceedings against several prominent private fund managers and large financial institutions, the SEC’s pronouncement of such actions sometimes appeared muted, often being posted on the SEC’s website without an accompanying press release, leaving some to wonder whether these actions were simply hold-over investigations which might be less enthusiastically pursued under the new administration.One clear change in the direction of the SEC’s enforcement program has been a promised pull-back on “broken windows” investigations favored by prior Chair Mary Jo White.While just a single district court decision, the case could have significant ramifications.The SEC, among other agencies, routinely asks counsel for information developed during internal investigations, and expects counsel to provide summaries of witness interviews in order for companies to receive cooperation credit from the SEC staff.