Cahill Discusses Amendments to Delaware Limited Liability Company Act

Amendments to the Delaware Limited Liability Company Act (the “DLLCA”) previously introduced in April 2018 were signed into law on July 24, 2018[1]. The amendments enable a Delaware limited liability company (an “LLC”) to engage in several new forms of transactions including: the (1) division of an LLC into two or more separate LLCs, (2) formation of registered series of LLCs and statutory public benefit LLCs and (3) use of blockchain technology for maintenance of LLC records and for electronic transmissions.

I. Division of LLCs

Overview

Effective August 1, 2018, an LLC may divide itself, and its assets … Read more

Cahill Gordon discusses FASB’s Recent Exposure Drafts on Determinations of Materiality

The Financial Accounting Standards Board (the “Board”) recently issued two exposure drafts that recommend a series of amendments related to determinations of materiality.1 These efforts form part of the Board’s ongoing disclosure framework project, an initiative dedicated to improving the quality and effectiveness of disclosures in the notes to financial statements.2

Fundamental to this objective are (1) the development of a framework that enables a clear and consistent understanding of disclosure requirements and (2) the appropriate exercise of discretion by reporting entities in deciding which information to communicate to investors.3 Towards these ends, the Board has proposed … Read more

Cahill discusses how Recent Cases Consider Challenges to Constitutionality of SEC’s Administrative Law Judges

Since the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”) expanded the authority of the Securities and Exchange Commission (“SEC”) to seek civil penalties through administrative proceedings,1 the SEC has brought, as one court observed, “an ever increasing number of enforcement actions within its own administrative scheme, rather than in federal court.”2 In 2014, for instance, the SEC initiated 43% of its litigated actions as administrative proceedings.3 This shift may be due, at least in part, to the reported advantage the SEC enjoys before its own Administrative Law Judges (“ALJs”). From October 2010 through … Read more

Cahill explains D.C. Circuit: Section 4E of the Exchange Act Does Not Bar SEC From Commencing Action More Than 180 Days After Issuance of Wells Notification

On July 10, 2015, the United States Court of Appeals for the District of Columbia Circuit held that the 180-day requirement set forth in Section 4E of the Securities Exchange Act of 1934 for the Securities and Exchange Commission (“SEC” or the “Commission”) to file an enforcement action after the issuance of a Wells notification is not jurisdictional.[1]

1. Factual and Procedural Background

In 2003, Ernest V. Montford, Sr., founder of institutional investment advisor, Montford and Company, Inc. (“Montford Associates” and collectively, “Petitioners”), began recommending that his clients invest with investment manager Stanley Kowalewski. When Kowalewski started his own investment … Read more