Regulatory Enforcement

Applied Micro Circuits Corp. is the latest company to agree to corporate governance changes as part of an overall settlement of a shareholder lawsuit. The designer of microchips for optical networks was sued after it was accused of making a series of false statements during late 2000 and early 2001, which allegedly boosted its stock […]

Did the Securities and Exchange Commission let off the hook a company it had charged with wrongdoing because it cooperated with an investigation? It sure seems like it at first glance. Last week, the regulator announced that Judge Barefoot Sanders, United States District Judge for the Northern District of Texas, entered an order dismissing the […]

When the Securities and Exchange Commission recently charged Siebel Systems with violating Regulation Fair Disclosure, the maker of business software enjoyed a couple of dubious firsts. For example, it was the first company to be charged for a Reg. FD violation for the second time. In addition, the Commission charged Siebel with violating Exchange Act […]

Has the legal community declared war on Sarbanes-Oxley? Probably not. But, there is some evidence that they are either beginning to chip away at the nearly two-year-old legislation, or at least willing to challenge some of its provisions. “It’s easier to attack it than a year ago,” asserts David Katz, partner at Wachtell, Lipton, Rosen […]

Bonita Springs, Fla.-based real estate developer WCI Communities announced that a former division president recently filed a lawsuit against the company and top management. Robert Hanna filed the suit June 30 under Sarbanes-Oxley whistleblower provisions, alleging he was terminated for raising issues after the company inflated yearly expectations and dumped assets at the last minute […]

Important issues about the attorney-client privilege of general counsel may be emerging from the California courts. The strange case involves the general counsel and vice president of Marvell Semiconductor, who—during acquisition negotiations with Jasmine Networks—failed to hang up his speakerphone after leaving a voicemail for a lawyer at Jasmine. The sensitive conversation was of course […]

Earlier this spring, Cendant Corp. agreed to settle a shareholder derivative lawsuit filed on behalf of the company, which alleged that the amended employment agreement with Chairman and CEO Henry Silverman was approved by the board of directors in violation of their fiduciary duties. EXAMPLES MCI: Unanimously adopted 78 recommendations by Corporate Monitor Breeden. Siebel: […]

Scrushy Back in April, the lawyers of former HealthSouth CEO Richard Scrushy filed a motion to dismiss three counts of his indictment related to Section 906 of Sarbanes-Oxley. The section is often criticized for its interplay with Section 302, as both require CEOs and CFOs to deliver different certificates with most SEC filings; Munger Tolles […]

When shareholders of First Aviation Services Inc. assemble in Memphis, Tenn., today (June 15) for their annual meeting, a rare thing will take place. A proxy fight. That’s right, we said “rare.” For the first time in more than decade, there has actually been a decrease in the number of proxy fights. Institutional Shareholder Services, […]

In a speech before the American Bar Association, SEC General Counsel Giovanni Prezioso shed some light on the Commission’s amicus program, through which it intervenes in private securities litigation to present its point of view.