An influential federal appeals court has given corporate defendants new ammunition to help defeat class certification in securities lawsuits. The New York-based 2nd U.S. Circuit Court of Appeals last month overturned class certification in the largest consolidated securities class action in U.S. history, directing the trial judge to view more skeptically claims that a purported […]
Martinek Paul J.
Posted inRegulatory Enforcement
Telemarketing Spat Shows Compliance Strife
The Federal Trade Commission and the Federal Communications Commission may be part of the same government, but that hasn’t stopped them from reaching widely different conclusions about what is permissible when it comes to telemarketing. The FCC, for example, has taken the position that prerecorded telemarketing calls are allowed, as long as they are placed […]
Posted inRegulatory Enforcement
10A Probes: The Auditor As First Responder
Call it the other whistleblowing provision of the corporate-governance world: Section 10A of the Securities Exchange Act. While Sarbanes-Oxley might hog the spotlight when it comes to anti-fraud legislation, Section 10A has evolved into a quiet but powerful force to root out corporate misdeeds. Created as part of the Securities Litigation Reform Act of 1995, […]
Posted inRegulatory Enforcement
10 Cases To Shape The 2007 Legal Landscape
Court rulings in Delaware and by federal judges across the country had an impact on a wide range of corporate-governance issues in 2006. Compliance Week has compiled overviews of 10 of the most important court decisions over the past year and gathered expert insights into the possible implications for companies in 2007 and beyond. Business […]
Posted inEthics & Culture
A Glimpse Into How Employees Use Hotlines
Nearly three-quarters of callers to corporate whistleblower hotlines haven’t tried to take an issue to management first—and people who report corruption and fraud are actually less likely to seek anonymity than those who report other types of issues. Those findings are just two of many in a first-of-its-kind benchmarking report recently released by The Network, […]
Posted inRegulatory Enforcement
Where The ‘McNulty Memo’ Goes From Here
Mixed reviews greeted the Department of Justice’s publication of new marching orders for federal prosecutors probing allegations of corporate wrongdoing. Under the “McNulty Memo,” issued last week, U.S. attorneys are supposed to seek the approval of Deputy Attorney General Paul McNulty before asking corporations to waive the attorney-client privilege or turn over sensitive documents that […]
Posted inAccounting & Auditing
Yet More Convergence: Tax, Audit Functions
Thanks to a growing number of laws and regulations, the tax, accounting and auditing sectors are increasingly overlapping, forcing professionals to pay more attention to the ramification of issues beyond their particular field of expertise. “It’s been coming from several sources,” says Mark Luscombe, principal federal tax analyst for consulting firm CCH. “Perhaps there was […]
Posted inRegulatory Enforcement
e-Discovery Rules To Impact Litigation Holds
The new federal rules on e-discovery certainly have a hold on compliance executives’ minds these days—both figuratively and literally. In effect since last week, the rules don’t specifically address the proper procedures needed to ensure that a company’s electronic data is “held” in the event of a lawsuit. But the dramatic change in how opposing […]
Posted inRegulatory Enforcement
Delaware Affirms High Bar In Director Suits
Any fears that the Delaware Supreme Court might be backing off its traditional protection of corporate directors were categorically put to rest earlier this month by a decision reinforcing the high standard that must be met to sue directors for failing to exercise sufficient oversight. According to experts, the ruling in the case—Stone v. Ritter—is […]
Posted inBoards & Shareholders
Hart-Scott-Rodino Ensnares Private Equity
Private equity firms and similar “financial buyers” might think they can sidestep many compliance and reporting requirements because they are, well, private. Yet obligations do exist—and one of the lesser-known pitfalls is the Hart-Scott-Rodino Antitrust Improvements Act. The Federal Trade Commission, which enforces HSR, made headlines earlier this fall when it nicked a Connecticut hedge-fund […]
