How to Curb Abuses of Insider Abstention and Rule 10b5-1 Plans

By David Rosenfeld January 22, 2024 by renholding

Company insiders will typically possess material non-public information (MNPI) about their companies. To allow them to trade, the SEC in 2000 adopted Rule 10b5-1, which provides an affirmative defense to insider trading liability if the trades are made pursuant to …

Davis Polk Discusses SEC’s Expansive View of Accounting Control Violations

By Robert A. Cohen, Michael Kaplan, John B. Meade, Joseph A. Hall and Martine M. Beamon November 28, 2023 by renholding

After receiving board approval to buy back stock under a 10b5-1 plan, a company interpreted Rule 10b5-1 in a manner with which the SEC disagreed. The SEC did not allege that the company traded on the basis of material nonpublic …

Cleary Gottlieb Discusses the SEC’s Disclosure Agenda and Corporate Governance

By Helena K. Grannis and Synne D. Chapman January 27, 2023 by renholding

In 2022, public companies witnessed a new kind of corporate governance activism. New rules and regulations from the Securities and Exchange Commission (the SEC) use the lever of mandated disclosure to push for corporate governance actions, and in some cases …

Cadwalader Discusses New SEC Rule 10b5-1 Trading Plan Rules

By Erica Hogan January 25, 2023 by renholding

On December 14, 2022, the U.S. Securities and Exchange Commission (“SEC”) unanimously adopted final rules adding new conditions applicable to Rule 10b5-1 trading plans and requiring disclosure of the adoption, modification or termination of Rule 10b5-1 trading plans by directors …

Market Practices and the Awareness/Use Problem in Insider Trading Law

By Robert T. Miller January 17, 2023 by renholding

In a new article, I respond to an article by Professor Andrew Verstein concerning the awareness/use problem in insider-trading law. As many readers know, this problem arises because, although Rule 10b-5 prohibits persons bound by a duty of confidentiality from …

SEC Chair Gensler on Final Amendments to Insider Trading Requirements

By Gary Gensler December 16, 2022 by renholding

Today [December 14], the Commission will consider whether to adopt amendments to Rule 10b5-1, as well as new required corporate disclosures related to executive officers’ and directors’ trading. I am pleased to support these new requirements because, if adopted, they …

Sullivan & Cromwell Discusses What Recent SEC Insider Trading Action Portends for Rule 10b5-1

By Nicolas Bourtin, Robert Downes, Steven Peikin and Karen Patton Seymour October 3, 2022 by renholding

On September 21, 2022, the Securities and Exchange Commission found that Cheetah Mobile Inc.’s Chief Executive Officer, Sheng Fu, and its former President, Ming Xu, committed insider trading in relation to securities they sold under a joint “10b5-1 plan.” In …

Latham & Watkins Discusses Stricter SEC Requirements for the Rule 10b5-1 Affirmative Defense

By Joel H. Trotter, Stephen P. Wink, Naim Culhaci and Deric Behar January 24, 2022 by renholding

On December 15, 2021, the Securities and Exchange Commission (SEC) issued a set of proposed amendments (the Proposal) regarding the adoption of trading plans that qualify for the affirmative defense against liability for trading on the basis of material non-public …

SEC Considers Amendments to Rule 10b5-1

By Reynolds Holding December 16, 2021 by renholding

It was a very busy day at the U.S. Securities and Exchange Commission yesterday, with the commission weighing in on several proposed rule changes. For starters, the commission considered proposed amendments to Rule 10b5-1 and new disclosure requirements designed to …

SEC Chair Gensler Testifies Before U.S. House Committee on Financial Services

By Gary Gensler October 7, 2021 by renholding

Good afternoon, Chairwoman Waters, Ranking Member McHenry, and members of the Committee. I’m honored to appear before you today for the second time as Chair of the Securities and Exchange Commission. As is customary, I will note that my views

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SEC Chair Gensler Testifies Before Senate Committee on Banking, Housing, and Urban Affairs

By Gary Gensler September 16, 2021 by renholding

Good morning, Chairman Brown, Ranking Member Toomey, and members of the Committee. I’m honored to appear before you today for the first time as Chair of the Securities and Exchange Commission. I’d like to thank you for your support in …

SEC Chair Gensler Speaks Before Investor Advisory Committee

By Gary Gensler September 10, 2021 by renholding

Thank you for the kind introduction. I’d like to note that my views are my own, and I’m not speaking on behalf of my fellow Commissioners or the staff.

I’m glad to participate in my second meeting of the Investor

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Insider Trading and Strategic Disclosure

By Joshua Mitts December 9, 2020 by renholding

With COVID-19 cases rising rapidly around the world, Pfizer’s announcement on November 9, 2020, that its coronavirus vaccine was highly effective in early trials offered a rare bright spot for the coming winter.[1] But the news was soon dampened …

Davis Polk Discusses SEC Rebuke Over Stock Buybacks Under 10b5-1 Plan

By Maurice Blanco, Robert Cohen, Joseph Hall, Michael Kaplan and Richard Truesdell October 22, 2020 by renholding

On October 15, the SEC announced a settlement stemming from a company’s series of stock buybacks undertaken pursuant to a Rule 10b5-1 plan. Although the SEC concluded that the company initiated the 10b5-1 plan at a time when it possessed …

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Rule 10b5-1