TheCorporateCounsel.net

Following on the heels of another insider trading case asking important questions – SEC v. Cuban – the SEC recently prevailed in another insider-trading case: SEC v. Dorozhko. In its decision, the Second Circuit held that hacking into a secure server and trading on the basis of information obtained constitutes a “deceptive device” under Section 10(b) – even though the guy didn’t owe a fiduciary duty to the company. Read some analysis in Tom Gorman’s “SEC Actions” Blog – and note we’ve been posting memos relating to this case in our “Insider Trading” Practice Area.

In this podcast, Bill Kelly and Billy Fenrich of Davis Polk discuss the Dorozhko ruling, including:

– How does the decision differ from SEC v. Cuban?
– What are the implications of these two opinions?

Court Upholds SEC’s Bar of an Accountant for “Unreasonable Conduct”

A few weeks ago , the DC Circuit Court of Appeals upheld a Rule 102(e) decision of the SEC – in Dearlove v. SEC – to bar an accountant from practicing before the SEC for conduct that was merely “unreasonable.” The Court affirmed the SEC’s ’06 order that had barred the Deloitte engagement partner on the audit of Adelphia Communications.

The Court held that Rule 102(e) did not require the SEC to employ a common law negligence standard since generally accepted accounting standards was the standard without requiring the SEC to elicit expert testimony on the reasonableness of petitioner’s conduct.

The Challenge to PCAOB’s Constitutionality

In this podcast, Merritt Cole of White and Williams discusses the case that the Supreme Court recently agreed to hear challenging the constitutionality of the creation of the PCAOB, including:

– What’s the history of this case?
– What are the issues before the Supreme Court?
– If the Supreme Court deems the PCAOB’s creation unconstitutional, what happens to it?
– Are there any other consequences if the Supreme Court holds the PCAOB unconstitutional?

– Broc Romanek