Securities Regulation

Cleary Discusses Second Circuit Decision That Syndicated Loans Are Not Securities

By Duane McLaughlin, Jared Gerber, Sabrina Singer, Anirudh Sivaram and Allison Caramico September 27, 2023 by renholding

On August 24, 2023, the Second Circuit affirmed the dismissal of state-law securities claims in Kirschner v. JP Morgan Chase,[1] concluding that the plaintiff failed to adequately plead that the syndicated term loans at issue were securities. This …

Finfluencers and the Reasonable Retail Investor

By Sue S. Guan September 26, 2023 by renholding

Existing securities laws primarily target lies. However, financial influencers, or finfluencers – people or entities with outsized influence on investor decisions through social media – need not lie in order to influence their followers. This means that finfluencers can profit …

Skadden Discusses CFTC Charges That DeFi Developers Facilitated Off-Exchange Trading

By Alexander C. Drylewski, Stuart D. Levi, David Meister, Daniel Michael, Chad E. Silverman and Peter A. Varlan September 26, 2023 by renholding

On September 7, 2023, the Commodity Futures Trading Commission (CFTC) issued three enforcement settlement orders against developers of decentralized finance (DeFi) protocols.¹ The orders charge Opyn, Inc., Deridex, Inc., and ZeroEx, Inc. (0x) with illegally offering leveraged and margined …

Why Short Attacks May Compel a Company to Sue

By Joshua Mitts September 25, 2023 by renholding

In a recent post on the Harvard Law School Forum on Corporate Governance, three partners at Skadden, Arps, Slate, Meagher & Flom LLP give practical advice to companies in preparing for and responding to a short attack.  With respect …

SEC Chair Gensler Speaks on Updates to the Names Rule

By Gary Gensler September 22, 2023 by renholding

Today [September 20], the Commission is considering final rules to update the Names Rule. I am pleased to support this rule adoption because it will help ensure that a fund’s portfolio matches a fund’s name. Such truth in advertising promotes

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Was the Exchange Act Redundant? The Questionable Legality of an SEC Commissioner’s Unicorn Reform Proposal

By Alexander Platt September 18, 2023 by renholding

The rise of private markets and the proliferation of “unicorns” (private startup companies valued at $1 billion or more) has diminished the SEC’s power and reach. Back in 2021, the agency signaled a plan to reassert itself by forcing unicorns …

SEC Commissioner Speaks on Trans-Atlantic Effort to Strengthen Market Oversight

By Jaime Lizárraga September 15, 2023 by renholding

Good evening, and thank you, Didier [Cahen, Secretary General, Eurofi], for your kind introduction and for your leadership in organizing this conference.[1]

It is a pleasure to join you in this beautiful part of the world, a UNESCO World

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Why the Major Questions Doctrine Does Not Cover SEC Crypto Lawsuits

By Todd Phillips and Beau Baumann September 14, 2023 by renholding

In West Virginia v. EPA, the Supreme Court expanded the reach of the major questions doctrine (MQD) by reframing it as a substantive canon and clear-statement rule rooted in both the Constitution’s separation of powers and “a practical understanding …

SEC Chair Testifies Before U.S. Senate Committee on Banking, Housing, and Urban Affairs

By Gary Gensler September 13, 2023 by renholding

Good morning, Chairman Brown, Ranking Member Scott, and members of the Committee. Thank you for inviting me to testify today. As is customary, I’d like to note that my views are my own as Chair of the Securities and Exchange

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Cleary Gottlieb Discusses New Private Fund Rules

By Maurice Gindi, Robin Bergen, Amber Phillips, Emily Alfano and Lauren Heller September 12, 2023 by renholding

On August 23, 2023, the U.S. Securities and Exchange Commission (“SEC”) adopted new rules under the Investment Advisers Act of 1940 (the “Advisers Act”) that will significantly impact private fund advisers (the “Final Rules”). …

SEC Commissioner Criticizes Funding for Consolidated Audit Trail

By Hester M. Peirce September 7, 2023 by renholding

Thank you, Mr. Chair. The CAT has been expensive, far more costly than anyone imagined it would be. CAT’s considerable costs need to be allocated and no allocation method is ideal. And regardless of which approach we choose, most costs …

Will the Common Good Guys Come to the Shootout in SEC v. Jarkesy? And Why It Matters

By Eric W. Orts September 6, 2023 by renholding

During my recent visit to Columbia Law School, Professor John Coffee shared with me a draft of a short article that later appeared in the New York Law Journal.[1] Coffee’s article assessed the prospects in the U.S. Supreme …

Paul Weiss Discusses Second Circuit Decision Confirming Syndicated Bank Loan Not a “Security”

By Lorin L. Reisner, Audra J. Soloway, Richard C. Tarlowe, Alexis K. Kaufman and Daniel Negless September 5, 2023 by renholding

On August 24, 2023, in a highly anticipated decision, the Second Circuit in Kirschner v. JPMorgan Chase Bank, N.A. et al. affirmed dismissal of state-law securities claims because the syndicated term loan in question was not a “security” and therefore …

SEC Chair Gensler on New Rules for Private Fund Advisers

By Gary Gensler August 24, 2023 by renholding

Today [August 23], the Commission is considering final rules related to private fund advisers. I am pleased to support this adoption because, by enhancing advisers’ transparency and integrity, we will help promote greater competition and thereby efficiency in this important

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Shareholders (and ISS) Won Big With Universal Proxy Card in 2023

By Michael R. Levin August 23, 2023 by renholding

Now that proxy season has wrapped up, we thought we’d look back at the experience with universal proxy card (UPC). Overall, shareholders expressed their preferences in BoD elections with precision. Proxy advisors, in particular ISS, saw their recommendations win in

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Sullivan & Cromwell Discusses Second Circuit Decision on Class Certification in Securities Fraud Cases

By Robert J. Giuffra Jr., David Rein, Jeffrey T. Scott, Benjamin R. Walker and Eric T. Andrews August 21, 2023 by renholding

On August 10, 2023, the Second Circuit handed down its highly anticipated decision in Arkansas Teacher Retirement System v. Goldman Sachs Group, Inc.[1] The court reversed the district court’s decision to certify a class action and remanded with …

Socially Acceptable Securities Fraud

By Christine Hurt August 18, 2023 by renholding

In the 90 years since the passage of the Securities Exchange Act, the number of ways market participants can publicly disseminate statements to investors has skyrocketed.  Yet no regulator, legislator, or judge has answered a fundamental question: Should the law …

SEC Chair Gensler Delivers Remarks on LIBOR Before the Financial Stability Oversight Council

By Gary Gensler August 16, 2023 by renholding

Thank you, Secretary Yellen. Thank you to all of my colleagues—not only at this table but around the globe—for their hard work putting an end to the London Interbank Offered Rate (LIBOR)

LIBOR was an innovation of the 1970s to

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ISS Discusses SEC’s $153 Million Fair Fund Payout to Investors in Mortgage-Backed Security Offering

By Jarett Sena August 15, 2023 by renholding

Investors of RBS Securities Inc.’s multi-billion 2007 subprime mortgage-backed security offering – Soundview Home Loan Trust 2007-OPT1 – will soon be eligible to receive payment from the SEC’s $153.7 million fair fund.

The SEC first commenced its case in 2013 …

The Ripple and Terraform Cases Tee Up a Dramatic Showdown over Cryptocurrency Regulation

By John Livingstone, Anat Alon-Beck and Nizan Packin August 14, 2023 by renholding

On July 31, U.S. District Judge Jed Rakoff in New York decided a case with significant implications for how and even whether the Securities and Exchange Commission can regulate cryptocurrencies as a security. His decision contrasts sharply with a ruling …