Client Alert
SEC Issues Stay of Shareholder Proxy Access Rules Pending Judicial Review
October 5, 2010
Yesterday, the Securities and Exchange Commission agreed to stay the effectiveness of its recently adopted shareholder proxy access rules pending judicial review of a claim challenging the validity of the new rules. The SEC’s action came in response to a petition for review filed last week in the U.S. Court of Appeals for the District of Columbia Circuit by the Business Roundtable and the Chamber of Commerce of the United States of America. In their petition, the business organizations asked the court to hold the SEC’s proxy access rules unlawful under the Securities Exchange Act of 1934 and other laws, alleging that the rules are, among other things, “arbitrary and capricious.”
These recent developments call into question whether the proxy access rules will be effective for the bulk of the 2011 proxy season (at least for spring 2011 proxy materials), since at this point it is difficult to predict how long an expedited review may take and how the court may ultimately rule regarding the validity of the proxy access rules.
Click here to read our client alert summarizing these events.
Contact Information
If you have any questions regarding these issues, please contact either the Womble Carlyle attorney with whom you usually work or one of our Corporate and Securities attorneys at the following link: http://www.wcsr.com/profSearch?team=corporateandsecurities.
If you have any questions regarding these issues, please contact either the Womble Carlyle attorney with whom you usually work or one of our Corporate and Securities attorneys at the following link: http://www.wcsr.com/profSearch?team=corporateandsecurities.
Womble Carlyle client alerts are intended to provide general information about significant legal developments and should not be construed as legal advice on any specific facts and circumstances, nor should they be construed as advertisements for legal services.
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