The SEC and business groups such as the Chamber of Commerce and Business Roundtable often end up on opposite sides of key issues, such as the extent to which the agency should be reformed, proxy access and other issues. But on one current issue, the Business Roundtable announced today that it has filed an amicus brief with the Second Circuit Court of Appeals supporting the SEC.
Today, Business Roundtable filed a brief asking the Second Circuit to reject the "novel, and potentially dangerous, approach to reviewing settlement agreements" that Judge Rakoff has taken in the SEC's case against Citigroup. In a press release, Business Roundtable stated that its "member companies have a significant interest in resolving enforcement actions through consent decrees, and the Federal District Court's decision to reject a negotiated settlement threatens to upend longstanding regulatory enforcement procedures and force businesses to engage in protracted litigation."
The business group added that Judge Rakoff's approach poses a serious threat to the "long-standing and appropriate practice of settling enforcement actions without admission of fault" (i.e., settlements in which defendants "neither admit nor deny" the SEC's allegations). "This case potentially affects nearly every major U.S. business and every federal regulatory agency," said Business Roundtable President John Engler. "The Federal District Court's decision, if left to stand, would seriously disrupt the normal course of regulatory enforcement and compliance. We hope the Federal Appeals Court will reverse this unsound decision."
On December 28, the Second Circuit ruled that SEC's emergency motion to stay the proceedings before Judge Rakoff in district court pending appeal and to expedite the appeal will be submitted to a motions panel on Tuesday, January 17, 2012. Proceedings in the district court are stayed until that ruling by the motions panel.