Columbia Law School
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Whenever I talk to economists, since I cannot awe you with a fancy equation, I have to start with a bad joke. It is a knock-knock joke, which is especially hard to pull off when trying to physically distance. “Knock,
Securities Regulation
Deregulating Innovation Capital: The Effects of the JOBS Act on Biotech Startups
Since the start of the COVID-19 pandemic, everyone from politicians to reporters to ordinary Americans have been talking about drug treatments, vaccines, and the Federal Drug Administration (FDA) approval process. These discussions have centered on vaccine developments by well-known pharmaceutical …
SEC Chair Speaks About Enhanced Investor Protections in the OTC Market
Technology has driven many efficiencies in our markets. Technology can also enhance investor protection. Today, we recognize that, as a result of technological change, information can and should be made available to over-the-counter (“OTC”) market investors in a more timely
How Categorizing Companies as Unicorns Affects Their IPOs
Managers, investors, the financial press, and other capital market participants often use categories to describe firms or their securities. Common examples include “bellwether,” “blue chip,” “tech,” “penny,” and “start-up.” Although these categories may increase a firm’s visibility, they can lead …
Morrison & Foerster Discusses Investor Exits: U.S. Direct Listing Rules in Flux
Amid intense focus on investor liquidity (and paths to potential liquidity) in private companies, we provide an update on developments around direct listings as an alternative to traditional IPOs in the United States.
On August 26, 2020, the SEC approved …
Debevoise & Plimpton Expects More New York Regulatory Enforcement of Banking and Financial Services
As American businesses, including financial institutions, adjust their operations in the wake of the coronavirus pandemic (COVID-19), the need to work closely with state regulators has become increasingly apparent. As anticipated, under the current federal administration we have seen state …
Asking the Hard Questions: A Review of Prof. John Coffee’s New Book, Corporate Crime and Punishment
Columbia Law Professor John C. Coffee, Jr.’s Corporate Crime and Punishment delivers a hard-hitting and provocative analysis of the securities law enforcement landscape and the choices that lie ahead. With SEC senior staff changes probable in any new administration, Coffee’s …
Securitization, Recourse Uncertainty, and Crash Risk
Asset securitizations have become a prominent type of financial transaction in recent decades. According to the Securities Industry and Financial Markets Association, $3.3 trillion worth of mortgage- and other asset-backed securities were issued in 2006. This number fell to $1.6 …
Insider Trading and Geographic Proximity: Evidence from Covid-19
The COVID-19 pandemic has dramatically changed how businesses operate, resulting in unprecedented stock market effects. While the U.S. stock market has historically shown little to no reaction to an infectious disease outbreak, COVID-19 precipitated a global stock market downturn now …
Davis Polk Discusses New Developments on Direct Listings
New developments last week will allow companies to raise funds in a direct listing. On Wednesday, the Securities and Exchange Commission (SEC) approved the NYSE’s rule change that will permit companies to raise capital in a direct listing. Prior to …
The Problem with Insider Giving
For a brief moment last month, Kodak Corporation’s stock soared from $2 a share to more than $33 a share on news that it might obtain substantial government financing. At that peak, Kodak director George Karfunkel unloaded shares then worth …
Arnold & Porter Discusses SEC Approval of NYSE Direct Listings Proposal
The SEC has given the New York Stock Exchange (NYSE) clearance to allow companies to raise capital in connection with a direct listing on the NYSE. A direct listing is an alternative to a traditional underwritten IPO that allows a …
Does Advertising Improve Access to Capital for Small Businesses?
Private markets have contributed significantly to capital formation in the U.S. economy, particularly for small companies that are often considered the engine for creating new jobs and for accelerating economic growth (see, e.g., Zhao, Harris, and Lam, 2019). The amount …
SEC Chair Clayton Discusses Modernizing Framework for Disclosures
Good morning. This is an open meeting of the U.S. Securities and Exchange Commission, under the Government in the Sunshine Act. I would like start today’s meeting by welcoming Commissioner Crenshaw to her first open meeting.
Today [August 26], we
SEC Commissioner Lee Discusses Regulation S-K and ESG Disclosures
Let me start with a warm welcome to our newest colleague, Commissioner Crenshaw. She has been a tremendous asset to the Commission for many years, and I know that she will continue to serve the agency, investors, and the public
SEC Commissioners Crenshaw and Lee Discuss Failure to Modernize Accredited Investor Definition
The accredited investor definition is the single most important investor protection in the private market.[1] Today’s amendments purport to “update” that definition while leaving in place 38-year old wealth thresholds, declining to index the thresholds to inflation, and declining
Does Environmental and Social Disclosure Affect Innovation at Companies?
Companies are typically not compelled to disclose environmental and social (E&S) information because this information does not meet the materiality standard used in many jurisdictions. However, some shareholders have an explicit mandate to screen potential investments based on E&S criteria. …
SEC Officials Offer Update on the Consolidated Audit Trail
Today [August 21], the Commission proposed amendments to the national market system (“NMS”) plan governing the consolidated audit trail (“CAT NMS Plan”). The proposed amendments are designed to enhance data security related to the ongoing development and operations of the
Lemonade, Inc.: Harbinger of Future Public Benefit Corporation IPOs?
The last six months have been marked by profound changes in how we live and interact with one another. The COVID-19 pandemic has cast a spotlight on societal inequities and racial injustice and reinvigorated dialogue around sustainability and environmental reform. …
Marginal Benefits of the Core Securities Laws
To many, the core securities laws on disclosure, fraud, and insider trading are desirable from an investor-protection perspective. But the dominant law and economics view is dubious of this thinking. Under this view, securities prices are discounted to reflect obstacles …