On April 17, 2014, the Securities and Exchange Commission (SEC) proposed new regulations that would implement the recordkeeping, reporting and notification requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The proposed regulations would apply to registered security-based swap dealers (SBSDs) and major security-based swap participants (MSBSPs), as well as to broker-dealers that are not registered as SBSDs or MSBSPs but are engaged in security-based swap activities.
The Volcker Rule: Criticisms and Compliance Issues
On December 10, 2013, the Office of the Comptroller of the Currency (“OCC”), the Board of Governors of the Federal Reserve System (“FRB”), the Federal Deposit Insurance Corporation (“FDIC”), the U.S. Securities and Exchange Commission (“SEC”), and the U.S. Commodity Futures Trading Commission (“CFTC”) issued jointly developed final regulations. By doing this, federal agencies implemented § 619 of the Dodd-Frank Act (Volcker Rule).
Regulation and the Future of Money: Mobile Payment and Virtual Currencies
What exactly is Bitcoin? You may have heard a great deal about this in the media. You may know that it is a virtual currency. You may have heard news that the evaluation of Bitcoin once skyrocketed to a record of $900. But you may not have heard an analysis of Bitcoin and other virtual currencies in the legal community.
Comcast and TWC Take Next Step in Proposed Merger
In February, the number one and number two cable providers in the US (Comcast and Time Warner Cable respectively) announced a proposed merger whereby Comcast would acquire TWC. The cable giants have already filed the Hart-Scott-Rodino notification with the DOJ, and on Tuesday, 8 April, they took another step towards completion of the merger by filing Applications and Public Interest Statement with the FCC. The merger must receive approval from both the DOJ and the FCC to proceed. The DOJ’s primary inquiry will be related to anti-trust concerns, whereas the FCC will seek to find that the merger achieves benefits that can only be reached by the combination of the two companies.
Corporate Law Experts Agree: Shareholder Activism Here to Stay
While the corporate law experts at Berkeley Law’s April 4 conference on shareholder activism offered different opinions about causes and impacts, they all found a patch of common ground: it’s here to stay.
Active shareholders assert their power as owners of a public company in order to change its behavior and encourage corporate responsibility, and their actions have increased dramatically in recent years. Triggering factors include sub-par share price performance, overly conservative financial strategies, and conglomerate business models. Since 2009, activist hedge funds have outperformed traditional hedge funds and other markets—forcing board rooms to take notice.
The conference, co-sponsored by the Berkeley Center for Law, Business and the Economy and the Berkeley Business Law Journal, illuminated this shifting landscape. Keynote speaker Larry Sonsini ’66, chairman of Wilson Sonsini Goodrich & Rosati, described how companies must adjust to these changes.
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As Some of the Bailout Banks Recover, Taxpayers Start to See Some Payback
Some recent news in the financial industry are indicating that bailout banks that received taxpayer money after the 2007-08 financial crisis may be starting to show signals of recovery and paying back some of the investments made by federal governments.
Federal Regulators Issue Joint Guidance on Company-Run Stress Tests for Mid-sized Banks
On March 20, 2014, the Board of Governors of the Federal Reserve System announced the results of the annual company-run stress tests for the 30 largest banking institutions, concluding that the institutions have improved their capital positions and are now better positioned to endure conditions of extremely severe stress than they were five years ago. For Mid-sized Banks, this announcement offers a glimpse into the implementation of the stress-test public disclosure requirements, which such institutions are required to meet in 2015.
SEC Cracks Down on High-Frequency Trading
Following the FBI’s announcement of a wide-ranging probe into high-frequency trading (HFT), the Securities and Exchange Commission (SEC) has placed its focus on the same area. “We currently have … a number of ongoing investigations regarding various market integrity and structure issuers, including high-frequency traders and automated trading,” said SEC Chair Mary Jo White, when testifying before a House of Representatives Appropriations subcommittee. Best-selling author Michael Lewis’s new book, “Flash Boys: A Wall Street Revolt” further fueled the long-standing debate that a group of tech-savvy insiders rigged the stock market using HFT.
DOJ Secures First-Ever Successful Extradition on Antitrust Charge
On Friday, April 4, 2014, the Antitrust Division of the United States Department of Justice (DOJ) announced that Romano Pisciotti, an Italian national, was extradited from Germany for his alleged role in a marine hose bid-rigging conspiracy. It was reported that Mr. Pisciotti was returning to Italy from Nigeria and was arrested during a layover at Frankfurt Airport. This is the first successful extradition by the DOJ on antitrust charges.
2014 Symposium: Keynote Address from Larry Sonsini on Shareholder Activism
During the 2014 BCLBE and BBLJ Shareholder Activism Symposium, Larry Sonsini delivered the keynote address directed at the change in the activist climate and how this change should be interpreted.
“Shareholder activism will be around for a while,” Sonsini declared because there has been a shift from a director-centric model to a shareholder-centric model. In this shareholder-centric model, shareholder activists agendas’ have become broader. They are no longer only concerned with battles over defensive measures (e.g., poison pills and staggered boards) and CEO successions, but are now addressing corporate sustainability—taking into account social, environmental, economic, and governmental measures—and are attacking companies on their merits.