Corporate / M&A

New European Measures to Allow Fines of up to 5% of Worldwide Turnover

Wed, 7 Dec 2011 14:13:51 -0500

The long awaited update to data protection legislation within the European Union is expected to be published in January 2012. It is anticipated that this will include a dramatic increase in the ability to fine for breaches of data protection legislation, of up to 5% of an organisation’s worldwide turnover.

For more information, please click here.

Considerations of Post-Reorganization Equity in the Secondary Market

Thu, 22 Sep 2011 16:26:30 -0400

In this article from The Distressed Debt Report, Brown Rudnick Attorneys Philip Flink and Timothy Bennett discuss issues potential sellers and buyers of securities should consider when negotiating, documenting and settling their trades in the post-reorganization equity of reorganized debtors.

To learn more about this topic, please read the article Considerations of Post-Reorganization Equity in the Secondary Market on our website.

Congress Passes Patent Reform Legislation

Fri, 9 Sep 2011 14:34:08 -0400

Voting 89-9 yesterday, the United States Senate passed H.R. 1249, the Smith-Leahy America Invents Act, and the President is expected to sign it. This legislation constitutes a significant change to the U.S. patent system. Most of the significant provisions in the new legislation will impact only patent applications with a priority claim within 18 months from the date of enactment, although other provisions of the act will take immediate effect.

For more information, please click here.

SEC Announces New Rules Regulating Private-Fund Advisers

Fri, 1 Jul 2011 10:43:30 -0400

On June 22, 2011, the Securities and Exchange Commission announced rules that will impose new registration and disclosure requirements on investment advisers to private funds. These requirements, which the SEC adopted pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, become effective March 30, 2012.

For more information, please click here.

Recent Seventh Circuit Decision Provides Clarity on the Assignability of Cure Rights in Bankruptcy Claims Transactions

Mon, 21 Mar 2011 13:51:08 -0400

Recently, the U.S. Court of Appeals for the Seventh Circuit issued an opinion that is noteworthy to participants in the claims trading market. In ReGen Capital I, Inc. v. UAL Corporation (In re UAL Corporation), 2011 WL 559702 (7th Cir. Feb. 18, 2011), the Seventh Circuit held that cure rights associated with an assumed contract are included in the bundle of rights "arising out of or in connection" with a claim against a debtor, and can thus be assigned to a third-party purchaser of such a claim.

For more information, please click here.

1 March 2011 - CAP Code Applies to Websites From Today

Fri, 11 Mar 2011 11:40:24 -0500

Website owners now need to comply with the rules in the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (the "CAP Code") in order to avoid sanctions for failing to do so.

For more information, please click here.

28 January - Today is European Data Protection Day

Mon, 14 Feb 2011 11:35:25 -0500

In addition to raising awareness of information security and privacy issues, this year European data protection day will signal a review of the current legislative framework.

For more information, please click here.

Federal Reserve Board Notice of Proposed Rulemaking Regarding Debit Card Interchange Fees and Routing

Nancy R. Wilsker (nwilsker@brownrudnick.com) — Wed, 29 Dec 2010 10:47:21 -0500

On December 16, 2010, the Federal Reserve Board issued a Notice of Proposed Rulemaking (NPRM) regarding Debit Card Interchange Fees and Routing. There have been several articles in the press regarding the politics of the proposal (and of how it would represent more than a 70% reduction in average debit interchange fees). This Alert is to give you a legal summary of what the Federal Reserve is proposing and of the timeline for commenting on the proposal and finalizing the regulations.

For more information, please click here.

SEC Proposes Rules Under Dodd-Frank On Stockholder Approval of Executive Compensation and Golden Parachutes

Wed, 1 Dec 2010 12:44:49 -0500

On October 18, 2010, implementing Section 951 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the SEC proposed rules that have important implications for all companies that are required to disclose compensation in their proxy statements or annual reports. These proposed rules would require such companies to hold advisory votes on executive compensation and, in certain circumstances, on "golden parachute" agreements.1

For more information, please click here.

Regulation FD Enforcement: Implied Messages Subject to SEC's Scrutiny

Wed, 1 Dec 2010 12:00:05 -0500

The Securities and Exchange Commission recently announced enforcement actions against Office Depot, Inc. and two executives for violating Regulation FD. The SEC alleged that the Company and the executives attempted to surreptitiously convey nonpublic information to select analysts and institutional investors. Office Depot agreed to settle the SEC's charges without admitting or denying the findings and allegations and to pay a $1 million penalty. The two executives also settled the Regulation FD charges also without admitting or denying the findings against them, and will pay $50,000 each.

For more information, please click here.

SEC Stays Effectiveness of New Proxy Access Rules

Thu, 11 Nov 2010 14:23:49 -0500

On October 4, 2010, the Securities and Exchange Commission issued an order to stay the effectiveness of recent changes to the federal proxy rules, including new Rule 14a-11, the amendment to Rule 14a-8 and other related amendments.

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Websites - Countdown to CAP Code Compliance

Wed, 29 Sep 2010 11:47:14 -0400

Website owners have been given six months to comply with the rules in the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (the "CAP Code").

As of 1 March 2011, the CAP Code will apply to advertisements and other marketing communications by or from companies, organisations or sole traders on their own websites, or in other space online which has not been paid for but which is under their control (including advertising on social networking websites), that are directly connected with the supply or transfer of goods, services, opportunities and gifts, or which consist of direct solicitations of donations as part of their own fund-raising activities.

For more information, please click here.

Summary of Dodd-Frank Compensation Provisions Applicable to Non-Financial Companies

Tue, 28 Sep 2010 13:46:23 -0400

The SEC must implement rules requiring the following (no specific timeframe given):

Executive Compensation Disclosures.

The SEC must require each issuer to disclose in any proxy statement for an annual meeting a clear description of any compensation required to be disclosed, including information (graphic or otherwise) that shows the relationship between executive compensation actually paid and the financial performance of the issuer, including any change in the value of the Company's shares, dividends and distributions. The SEC must also require disclosure of (i) the median annual total compensation of all employees, except the CEO, (ii) the annual total compensation of the CEO, and (iii) the ratio of the median employee annual total compensation to that of the CEO.

For more information, please click here.

Vodafone: Bombay High Court Ruling Impacts Transactions with Entities Indirectly Holding Assets in India

Thu, 23 Sep 2010 11:17:40 -0400

On September 8, 2010, the Bombay High Court held that the Indian Income Tax Department ("ITD") has jurisdiction to impose capital gains tax on the sale of shares in a Cayman Islands-based holding company that indirectly held an interest in a company with assets and operations in India.

For more information, please click here.

SEC Adopts Proxy Access Rules

Wed, 1 Sep 2010 10:29:23 -0400

New regime will impact public companies, shareholders and activist investors.

On August 25, 2010, the SEC adopted new rules that require companies to include the director nominees of significant, long-term shareholders in company proxy materials, alongside the nominees of management. These new "proxy access" rules will impact public companies, shareholders and activist investors. Qualified shareholders can now avail themselves of company proxy statements to nominate and elect directors, rather than having to launch expensive proxy fights in which they mail their own ballots.

For more information, please click here.

Massachusetts Allows Carry Forward of Losses for 20 Years and a Reduced Capital Gains Rate for Start-Ups

Tue, 17 Aug 2010 11:13:24 -0400

On August 5, 2010, Massachusetts Gov. Deval Patrick signed into law an economic development bill that provides favorable tax treatment under Massachusetts tax law. Specifically, the new law (1) allows corporations to carry forward losses for 20 years up from the current limit of 5 years and (2) reduces an investor's tax rate on capital gains earned on investments in start-up companies from 5.3 percent to 3 percent.

For more information, please click here.

New Rules Under Dodd-Frank Law to Impact Derivatives Trading & Market Participants

Tue, 17 Aug 2010 11:08:35 -0400

This Alert is the third in a series of Alerts that examine key aspects of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act"), which was signed into law by President Obama on July 21, 2010. The Act contains numerous provisions which attempt to regulate the over-the-counter derivatives market, both by establishing new requirements and removing exemptions that had been previously codified. This alert summarizes some key points likely to impact your business.

For more information, please click here.

The Dodd-Frank Wall Street Reform & Consumer Protection Act

Tue, 27 Jul 2010 11:38:37 -0400

This Alert-the second in a series of Alerts that examine key aspects of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act"), which was signed into law by President Obama on July 21, 2010-focuses on changes to the "accredited investor" definition under the Securities Exchange Act of 1933. The changes take effect immediately and potentially impact issuers currently engaging in private offerings.

For more information, please click here.

Financial Reform Legislation Approved by House-Senate Conference Committee

Fri, 2 Jul 2010 15:54:42 -0400

Dodd-Frank Act Brings Financial Reform Legislation Closer to Reality

Status: On June 25, 2010, the House-Senate conference committee concluded its reconciliation of separate financial reform bills previously approved by the House and Senate. The result of that reconciliation, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act"), was passed by the House (with some modifications) on June 30, 2010. It must now be approved by the Senate before being presented to the President for signature. The recent death of Senator Byrd impacts the Senate’s schedule and voting dynamics, and continued political wrangling leaves the Act’s passage in the Senate unclear. As of the time of this writing, the political landscape appears tilted towards passage, though a Senate vote will not occur before the week of July 12. We will continue to update you on material developments.

For more information, please click here.

The Thin Blue Line

Mark A. Dorff (mdorff@brownrudnick.com) — Thu, 27 May 2010 10:41:15 -0400

As companies once more consider cross-border acquisitions, Mark Dorff, Co-Chair of Brown Rudnick’s European Venture Capital and Emerging Technologies Group outlines the issues for those occurring across the Atlantic.

For more information, please click here.

SEC Approves Alternative Uptick Rule

Tue, 2 Mar 2010 15:29:59 -0500

On Wednesday, February 24, 2010, the Securities and Exchange Commission (SEC), voting 3-2 on party lines, adopted a new rule that restricts short selling when a stock is experiencing significant downward price pressure. This new alternative uptick rule imposes restrictions on short selling when the price of a stock drops 10 percent or more from the prior day’s closing price. Once the circuit breaker is triggered, the alternative uptick rule would apply to short sale orders in that security for the remainder of the day as well as the following day. Short selling would still be permitted if the price of the security is above the current national best bid.

For more information, please click here.

Let the 2010 Proxy Season Begin!

Tue, 2 Mar 2010 15:25:34 -0500

Last year was a busy year. The Securities and Exchange Commission (SEC) adopted comprehensive rule revisions intended to improve the disclosure provided to shareholders of public companies regarding compensation and corporate governance matters. It also approved the New York Stock Exchange’s amendment to NYSE Rule 452, "Giving Proxies by Member Organizations," which eliminated broker discretionary voting for all elections of directors, whether or not contested, except for companies registered under the Investment Company Act of 1940. These changes will dramatically impact this year’s proxy season.

For more information, please click here.

Change in After Hours Nasdaq Notification Requirement

Tue, 2 Mar 2010 15:20:58 -0500

Last week, the Securities and Exchange Commission issued a Release, which made immediately effective a rule change proposed by The Nasdaq Stock Market LLC to Nasdaq Rule 5250 and IM-5250-1, modifying the prior notification requirements for when Nasdaq listed companies release material information outside of Nasdaq market hours (7:00 a.m. to 8:00 pm. ET).

For more information, please click here.

SEC Staff Issues Revised Guidance on Non-GAAP Financial Measures

Tue, 2 Mar 2010 14:58:29 -0500

On January 11, 2010, the staff of the Securities and Exchange Commission (SEC) updated its Compliance and Disclosure Interpretations (C&DIs) regarding the disclosure of non-GAAP financial measures. The C&DIs supersede the SEC’s Frequently Asked Questions (FAQ) regarding the use of such measures published in 2003 but incorporate much of the SEC’s prior guidance.

For more information, please click here.

Supreme Court Hears Oral Arguments in Bilski v. Kappos

Fri, 13 Nov 2009 15:20:27 -0500

The Supreme Court agreed earlier this year to hear the Bilski case and address the question of whether the “machine-or-transformation” test enunciated last year by the Federal Circuit is appropriate for determining patent-eligible subject matter.

For more information, please click here.

State Regulator Files Final Massachusetts Data Security Regulations: Retains March 1, 2010 Effective Date

Fri, 13 Nov 2009 15:14:59 -0500

The Office of Consumer Affairs and Business Regulation (OCABR) filed final Data Security Regulations on November 4, 2009, retaining the March 1, 2010 effective date. As reported in prior Alerts, persons who have access to personal information regarding Massachusetts residents in connection with business or employment must have a written information security plan in place by the effective date. The requirements of the Regulations were summarized in the Alert we published on September 25, 2009.

For more information, please click here.

FTC Postpones Enforcement of Red Flags Rule: U.S. District Court Holds Rule Not Applicable to Lawyers

Mon, 9 Nov 2009 16:04:16 -0500

There have been two important developments recently regarding the Federal Trade Commission’s Red Flags Rule.
The Red Flags Rule requires financial institutions and creditors to develop and implement written identity theft prevention programs. These programs must provide for the identification, detection, and response to patterns, practices, or specific activities -- known as "red flags" -- that could indicate identity theft. Generally speaking, the Rule applies to all persons who regularly permit consumers to defer payment for goods and services purchased. An obvious example of a "creditor" that is subject to the Rule is an automobile dealer; a less obvious example is a lawn mowing service that provides the service and subsequently sends a bill.

For more information, please click here.

The U.S. Freedom of Information Act: Negative Emails About Competitor Need Not Be Produced

Tue, 14 Apr 2009 13:21:49 -0400

Government contractors sometimes pursue the disclosure of competitor information through requests under the U.S. Freedom of Information Act1 ("FOIA"). When a contractor is notified that the government may reveal confidential information in response to a FOIA request, that contractor has the right to assert that its confidential information be exempted from disclosure.

For more information, please click here.

Investor Directors of Distressed Companies: How Should They Act?

(James Shaw) jshaw@brownrudnick.com & (Louise Verrill) lverrill@brownrudnick.com — Tue, 14 Apr 2009 13:19:22 -0400

For most private equity and venture capital firms, it is an established industry practice to appoint their partner(s) to act as investor director(s) in their portfolio companies with a view to gaining more active supervision and management of the company. Few, if any, questions have been asked, and scant concerns have been raised about this standard practice during the recent golden era of finance. After all, most companies performed well, and in good times there is rare occasion to question the performance and prudence of the directors. However, the current financial turmoil is casting doubt on this standard practice. Irrespective of how or why a director holds office, he or she still has certain duties and responsibilities.

For more information, please click here.

Brown Rudnick Represents India Cleantech Company, The Acme Group, in 1,000 Mw Solar Energy Deal

Tue, 7 Apr 2009 14:57:36 -0400

Brown Rudnick, an international law firm, represented the ACME Group (“ACME”), a provider of energy, environmental, and telecommunications infrastructure solutions in India, in the company’s solar energy deal with eSolar. Under the agreement, eSolar signed an exclusive license agreement with ACME to build up to 1,000 MW of solar thermal power plants in India over the next ten years. The deal specifies that ACME will use eSolar's modular, scalable solar power technology for the project, and that ACME is open to work with other companies looking to build solar plants using eSolar's technology. Additionally, ACME will make a multi-million dollar equity investment in eSolar.

For more information, please click here.