In the case of Home Valley Bancorp. Inc., pending in the U.S. Bankruptcy Court for the District of Oregon, the Bankruptcy Court validated the vote and election of a Chapter 7 trustee candidate by a security holder — reflecting a congressional policy that the liquidation and distribution of a Chapter 7 estate is ultimately for the creditors and such creditors should have a clear and effective voice in selecting a trustee who will carry out this process, say attorneys with Arent Fox LLP.
Companies need to be careful when dealing with employees who raise concerns about public filings and disclosures — even when those concerns have nothing to do with fraud. As Sylvester v. Parexel Int’l LLC demonstrates, the world of the Sarbanes-Oxley Act’s whistleblower protections is far bigger than most companies anticipate, say Mary Pivec and Igor Babichenko of Williams Mullen PC.
The alleged manipulation of the London Interbank Offered Rate has received prominent media coverage this summer, drawing scrutiny of leading banks and their regulators — as well as numerous lawsuits. As litigation continues, one can expect institutional investors with large claims to opt out of class actions and pursue individual federal and state law claims, say Stacey Slaughter and Thomas Berndt of Robins Kaplan Miller & Ciresi LLP.
Despite the differences in two recent reports on securities class actions filed in the first half of 2012, the key point which emerges from all the statistics and trends is that a public company has a much more significant chance of being named as a defendant in a securities class action today than several years ago, says Thomas Gorman of Dorsey & Whitney LLP.
Your most trusted compliance personnel are likely the individuals best positioned to be Dodd-Frank whistleblowers. If your company has a real problem, the last thing you need is a member of your fact-finding or leadership team reporting information to the U.S. Securities and Exchange Commission before the company has had an opportunity to properly consider preliminary investigation results, say Ross Booher and Taylor Phillips of Bass Berry & Sims PLC.
In recent years, the Delaware courts have delivered numerous decisions focusing on the disclosure of issues and information relating to acquisition targets’ financial advisers in change of control transactions. On initial consideration, rationalizing the case law appears challenging at best. But when considered as a whole, and with a view toward the underlying transaction process, it may be possible to anticipate how the court might react, says Alec Dawson of Morgan Lewis & Bockius LLP.
In reaching their global settlement agreement with Madoff trustee Irving Picard, the Wilpons should have considered resolving potential duty of loyalty and conflicts of interest issues of the fiduciaries. Otherwise there can be a myriad of future complaints, says Michael Kline of Fox Rothschild LLP.
For a company whose capital structure includes preferred stock with a liquidation preference, there is the question of how to treat that liquidation preference when determining the per-share “fair value” of the common, the preferred, or some other specific class of the company’s stock. Two recent Delaware Court of Chancery decisions demonstrate that the answer depends on several things, says Bradley Voss of Pepper Hamilton LLP.
Corporate acquisitions, mergers and reorganizations, loans and audits are regular events in which physical stock certificates may be required, corporate books reviewed and possible related legal opinions given. As such, it is best to be prepared for the possibility that old corporate records will either contain irregularities or be missing altogether, says Aurora Cassirer of Troutman Sanders LLP.
A new U.S. Securities and Exchange Commission enforcement action against a financial adviser who specializes in assisting China-based businesses that become U.S. public companies through reverse takeovers highlights how such advisers present a distinct — yet often poorly understood — risk for private equity investors, say Paul Boltz and Daniel O'Connor of Ropes & Gray LLP.