Monthly Archives: January 2013

January 16, 2013

End of the Year Lists: How Was the SEC’s Enforcement’s Year?

As with the end of every calendar year, lists are made and analyzed. This Reuters article counts the number of settlements by the SEC’s Enforcement Division. Meanwhile, this National Law Journal article penned by Enforcement Director Rob Khuzami and Deputy Director George Canellos supports their legacy. The article starts like this:

In his December 3, 2012, column, “SEC enforcement: What has gone wrong?,” Columbia Law School professor John C. Coffee Jr. makes a series of claims about U.S. Securities and Exchange Commission enforcement cases. These claims are inaccurate and paint a distorted picture of an enforcement program that has achieved record results in recent years. As a solution to the problems he sees, Coffee proposes that the SEC outsource its biggest cases to private contingency-fee lawyers — a suggestion that ignores critical differences between the SEC’s goals as a regulator and those of a litigant seeking monetary damages.

Finally, it’s worth noting this Reuters article entitled “SEC probes Ernst & Young over audit client lobbying.”

SEC Approves NYSE’s “Methods for Providing Notice” Amendment

Here’s news from Cooley’s Cydney Posner:

The SEC has just approved an amendment to the NYSE rules regarding the method for providing notices to the NYSE of matters or events where timely notification is essential for investors to take certain actions. Currently, the Manual provides for various methods of notice. Now, the NYSE is providing, in Section 204.00, a new, uniform method of notification through a web-based communication system – either a web portal ( ) or an email address – specified by the NYSE in a prominent position on its website.

The new method will be applicable to notices regarding the following events:

– Closing of transfer books;
– Notice of dividend action or action relating to a stock distribution;
– Meetings of shareholders, notice of the fixing of a date for the taking of a record of shareholders or for the closing of transfer books;
– Redemption of listed securities;
– Notice of corporate action which will result in, or which looks toward, either the partial or full call for redemption of a listed security; notice of dates set in connection with the calling of any meeting of shareholders; and
– Notice by transfer agents of the number of shares outstanding at the end of each calendar quarter.

In emergencies, such as technical problems at the NYSE or the company, companies will be able to provide notifications by telephone and confirm by fax. In addition, where a material event or a statement dealing with a rumor that requires immediate release is made shortly before the opening or during market hours, companies must notify the NYSE using the telephone alert procedures set forth in Section 202.06(B). Under those procedures, the company must give ten minutes notice to its NYSE representative by telephone (along with transmission of the written text) prior to release of the announcement; under the new rule, the written text must now be transmitted using the web-based communication system.

For the remaining notification provisions in the Manual that do not direct companies to follow the new notification methods, companies may use the methods provided for in Section 204.00 or any other reasonable method. (In these other events, more flexibility is permitted because, while the NYSE needs to be informed promptly, the NYSE believes that a company’s failure to notify the NYSE immediately would not significantly disadvantage investors.)

The NYSE is also making some technical, clarifying and conforming changes to the “Guide to Requirements for Submitting Data to the Exchange.” Finally, the number of hard copies of proxy materials required to be provided to the NYSE is being reduced from six to three.

Webcast: “The Latest Developments: Your Upcoming Proxy Disclosures –
What You Need to Do Now!”

Tune in tomorrow for’s webcast – “The Latest Developments: Your Upcoming Proxy Disclosures – What You Need to Do Now!” – to hear Mark Borges of Compensia, Alan Dye of Hogan Lovells and, Robbi Fox of Exequity, Dave Lynn of and Morrison & Foerster and Ron Mueller of Gibson Dunn discuss all the latest guidance about how to overhaul your upcoming disclosures including these topics:

– Overview of key lessons from the 2012 proxy season
– The rise of the proxy summary
– Developments with CD&A and executive summaries – including realized/realizable pay
– The impact of the compensation committee and advisor independence rules in 2013
– Hedging and pledging policies in the wake of the 2013 ISS policy change
– Engagement strategies for 2013
– Compensation and governance shareholder proposals

– Broc Romanek

January 15, 2013

The Handbooks: All of Them in One Place

Over the past year, I have blogged about a number of comprehensive Handbooks that we have posted on the site. Many members have asked if we have housed the Handbooks in one spot – and indeed we have. There is a “Handbooks” Practice Area, listed alphabetically among the hundreds of Practice Areas on the left side of our home page. And there are many more Handbooks than I blogged about last year. Take a gander…

Where to List: NYSE or Nasdaq?

I love to note when new securities law blogs emerge and “The Securities Edge” by Gunster’s David Scileppi & his colleagues looks very promising. For example, here is a recent entry on a common topic – which stock exchange should a company list upon…

Webcast: “The ‘Former’ Corp Fin Staff Speaks”

Tune in tomorrow for the webcast – “The ‘Former’ Corp Fin Staff Speaks” – to hear former Senior Staffers from the SEC’s Division of Corporation Finance Brian Breheny of Skadden Arps, Marty Dunn of O’Melveny & Myers, Linda Griggs of Morgan Lewis and Dave Lynn of and Morrison & Foerster weigh in on what you need to be doing for the upcoming proxy season including tackling these topics:

1. Status of conflict minerals & resource extraction rulemakings
2. Status of IFRS
3. Proxy access proposals
4. Cybersecurity disclosures
5. Corp Fin’s new Office of Disclosure Standards and possible impact on comments
6. Status of COSO’s internal controls project
7. Other shareholder proposals
8. Iran & Syria disclosures
9. Comment responses as part of your disclosure stream
10. Mandatory auditor rotation & other PCAOB rulemakings
– Broc Romanek

January 14, 2013

NYSE & Nasdaq File New Amendments to Proposed “Compensation Committees and Advisers” Listing Standards

With the SEC staring at yesterday’s deadline for its extension to approve the NYSE & Nasdaq proposals to comply with Rule 10C-1 under the Exchange Act comes this news from Davis Polk’s Ning Chiu on Friday:

Both the NYSE and Nasdaq have filed further amendments to their proposed listing standards on compensation committees and their advisers. The amendments copy directly from the exception in Item 407(e)(3)(iii) of Regulation S-K with respect to the proxy disclosure rules for compensation consultants.

The amendments clarify that a compensation committee is not required to conduct the independence assessment of an adviser whose role is limited to (a) consulting on any broad-based plan that does not discriminate in scope, terms, or operation, in favor of executive officers or directors, and that is available generally to all salaried employees or (b) providing information that either is not customized or that is customized based on parameters that are not developed by the adviser, and about which the adviser does not provide advice.

The SEC enhanced proxy disclosure rules in December 2009 permitted these exceptions in response to commentators who suggested that broad-based, non-discriminatory plans and the provision of information, such as surveys, that are not customized, should not be treated as compensation consulting services that would raise conflict of interest concerns.

The NYSE amendment also added language indicating that nothing in the section requiring a compensation committee to consider the specific adviser independence factors is intended to limit compensation committees from selecting or receiving advice from any adviser that they prefer, including ones that are not independent. NASDAQ already had a similar statement.

My ten cents: Given that the SEC’s deadline to act was yesterday – and a statement is in both the exchange’s latest amendments saying they don’t consent to an additional extension for the SEC to act – maybe the SEC will approve the amendments today or soon enough. Since a portion of the new rules will be effective July 1st, they have to give companies time to comply…

FINRA Releases Interim Form for Crowdfunding Portals

Here’s something blogged on Friday by Vanessa Schoenthaler in the “100 F Street” Blog:

Last week, FINRA announced that it would begin accepting information on a voluntary basis from prospective crowdfunding portals. FINRA will use the information to better understand the funding portal community and to develop specific funding portal rules.

Prospective crowdfunding portals are encouraged to submit an Interim Form for Funding Portals (“IFFP”) as well as any additional information or documentation that might be helpful to FINRA at: FINRA will treat the information submitted on a confidential basis.

The IFFP covers general business information, ownership structure, sources of funding , information about management, compensation and a prospective crowdfunding portal’s business model.

Once the SEC and FINRA adopt final crowdfunding portal rules any prospective funding portals that file an IFFP will still have to file an application to become a FINRA member.

Mailed: November-December Issue of The Corporate Counsel

We recently mailed the November-December issue of The Corporate Counsel that includes pieces on:

– Say-on-Pay Arrives for Smaller Reporting Companies: Compliance Tips
- D&O Questionnaire Changes
- Hedging and Pledging Policies
- An Update on Say-on-Pay 2.0 Proxy Litigation
- Complying with the New Iran Sanctions Periodic Reporting Disclosure: New Staff CDIs Offer Guidance
- Affiliate-Donor’s Form 144–Staff Says Affiliate Should Include Aggregated Donee Sales in Table II
- Effective Date of the Audit Letter
- Our SEC Rulemaking Status Chart
- New Auditing Standard Adopted: No Changes to the Audit Committee Report Yet

Act Now: Get this issue rushed to when you try a 2013 No-Risk Trial today.

– Broc Romanek

January 11, 2013

Survey Results: Compensation Consultant Conflicts Disclosure

As you know, a new SEC rule (Item 407(e)(3)(iv) of Regulation S-K) requires disclosure if a conflict of interest has arisen in connection with the work of a compensation consultant (whether selected by management or the compensation committee). To satisfy this disclosure requirement, companies will need to conduct a conflicts of interest assessment. This raises the question of whether companies will include voluntary disclosure (so-called “negative disclosure”) in their proxy statement when a determination of “no conflict” has been made. Here are the results from our recent survey regarding what companies are preparing to do:

1. For our next proxy statement, when it comes to the newly required conflicts of interest disclosure about compensation consultants (ie., Item 407(e)(3)(iv) of Regulation S-K), assuming that no conflict of interest is identified, our company:
– Has made a decision, at least at the staff level, whether to make voluntary negative disclosure (eg., as an anticipatory “best practice” or simply to signal to the SEC Staff and our shareholders that we were aware of the new disclosure requirement) – 62%
– Hasn’t yet figured out whether it will make any voluntary negative disclosure – 35%
– I hadn’t realized that there is a new conflicts of interest disclosure (and assessment) requirement! – 3%

2. For those of you who know which approach your company will take, our company intends to:
– Only provide disclosure if a conflict of interest is identified – and not provide any voluntary negative disclosure – 25%
– Provide voluntary disclosure that a conflicts of interest assessment was conducted and that no conflict of interest was identified – 67%
– Provide voluntary negative disclosure that works through one or more of the six non-exclusive factors supporting a “no conflict of interest” conclusion – 8%

Please take a moment to participate in our “Quick Survey on Internal Audit” and “Quick Survey on Shareholder Engagement.

SCOTUS Oral Argument: Gabelli v. SEC

On Tuesday, the Supreme Court heard oral arguments in Gabelli v. SEC, a case about the SEC seeking civil penalties after exceeding the usual time limit for fraud investigations. Here are articles about how the hearing went:

Reed Smith’s “The Clock Is Ticking for the SEC… (Or Is It?)”
SCOTUS Blog’s “Argument preview: Too bad both sides can’t lose this one
Pension & Investment’s “Supreme Court hears arguments in Gabelli case on SEC enforcement clock
Reuters’ “Supreme Court skeptical of SEC power in Gabelli case”
WSJ’s “Justices Skeptical of SEC”
Securities Law Prof Blog’s “U.S. Supreme Court Hears Oral Argument in Gabelli v. SEC

As noted in this Reuters article, the SEC is being investigated by a House committee for spending on outside consultants during its efforts to streamline the agency.

Conflict Minerals Navigation Checks

In this podcast, Lawrence Heim of The Elm Consulting Group International explains CM CheckPoint (sm), a new rapid and highly cost-effective conflict minerals program assessment method/deliverable facilitated on-site

– What should companies who have already initiated conflict minerals programs be doing now in terms of benchmarking their efforts?
– What is the “CM CheckPoint”?
– How does it stack up to the alternatives?
– What are the reactions from clients so far?

– Broc Romanek

January 10, 2013

The Exodus is Complete: SEC’s Enforcement Director Khuzami to Leave

So the rumor was true. Yesterday, the SEC announced that Enforcement Director Rob Khuzami would be leaving the agency after a 4 year tenure. No word as to his next employer – but I imagine it will be lucrative as Enforcement Directors typically earn the most once they depart the agency (which is why Bill McLucas’ 8-year stint was always a surprise). Rumored replacements are named in this DealBook piece. Rob’s departure means that 3 Division Directors and the General Counsel have all announced departures since Chair Mary Schapiro announced her exit. Wow…

Exodus, movement of Jah people

Will the SEC Propose Rules on Corporate Political Spending by April?

Ning Chiu of Davis Polk asks the question that I received from so many of you after Prof. Lucian Bebchuk blogged yesterday that the SEC would propose rules in the political spending area by this April (you may recall that Lucian’s co-sponsored rulemaking petition in this area has drawn over 320,000 comments!). Lucian’s prediction was based on some language in the Office of Management and Budget’s Unified Agenda. As Ning blogged, the OMB Unified Agenda includes a list of potential SEC rulemakings with fairly extensive and ambitious timetables.

I think the key term here is “ambitious.” All kinds of whacky and aspirational stuff makes it into the Reg Flex agenda, which then winds up as part of the OMB Unified Agenda (in this blog, Keith Bishop explains what the OMB Unified Agenda is). So it’s hard to read the tea leaves on this one – although the massive turnover among the SEC’s senior staff and the 2-2 split among political parties in the Commission itself makes this bet one where you should seek long odds when it comes to an April timetable for an actual proposal. Then again, this topic is white hot right now…

More on “The Mentor Blog”

I continue to post new items daily on our blog – “The Mentor Blog” – for members. Members can sign up to get that blog pushed out to them via email whenever there is a new entry by simply inputting their email address on the left side of that blog. Here are some of the latest entries:

– Delaware Holds Insured’s Payment of Defense Costs Doesn’t Trigger Excess Insurer’s Obligations
– Should You Really Sit on Other Boards When You’re a Startup Founder?
– Delaware Court Addresses Caremark, Race to the Courthouse
– Survey: Boards on Auditor Rotation, Proxy Advisory Firms & More
– A Comprehensive Survey of ESG Studies

– Broc Romanek

January 9, 2013

Federal Agency Workplace Survey: SEC’s Rank Is #4 Worst Mid-Size Agency

The SEC’s status continues to take a hit in the “Best Places to Work” rankings, a survey that evaluates job satisfaction among federal agency employees – hovering at #19 this year out of 22 (note the agency was 5th in ’07) and being named the 4th worse place to work among mid-size agencies. Here are the ’12 rankings; here’s a Washington Post article. The SEC ranked near the bottom in many categories including 18th for leadership; 17th in pay and dead last in performance-based rewards and achievement. The best it did was 13th in the work/life balance category…

GAO Report: Dodd-Frank Cost-Benefit Analysis Finds Some Agencies Not Consistently Following OMB Guidance

A few weeks ago, the GAO issued this report on the cost-benefit analysis conducted by those federal agencies charged with implementing Dodd-Frank. The OMB has cost-benefit guidance but the SEC and some of the other independent agencies are not required to follow OMB’s guidance – although they attempt to follow it in principle. As noted in this Compliance Week blog, the GAO’s review of 54 Dodd-Frank related rules found that some regulators did not consistently follow key elements of the OMB guidance and did not evaluate their chosen approach compared to the benefits and costs of alternatives.

Webcasts: “Dissecting the Quarterly Earnings Process”

Recently, there have been a large number of earning release snafus – some highly publicized, some not. And then we have these findings from the recent NIRI 2012 Guidance Survey:

– 88% of respondents provide some form of guidance (either financial, non-financial or both), compared to 90% in 2010 and 93% in 2009
– 76% report providing financial guidance compared to 81% in 2010 and 85% in 2009
– 44% provide non-financial (broad market) guidance in 2012, a decrease from 48% reported in 2010 and 55% reported in 2009
– For those that do not provide guidance, the majority (60%) have never done so

Tune in tomorrow for the webcast – “Dissecting the Quarterly Earnings Process” – to hear Dave Lynn of and Morrison & Foerster, Ron Mueller of Gibson Dunn, Ginny Fogg of Norfolk Southern, Robert Lindsey of Dell and Eileen McCarthy of Jet Blue talk about the latest developments in managing the quarterly earnings process.

– Broc Romanek

January 8, 2013

SEC’s New GC Hails from the CFTC: Something New

Sock it to me baby! That’s something old. Something new is the SEC hiring a former CFTC Staffer for its own senior staff. That happened yesterday as Geoffrey Aronow was tapped to become the SEC’s new General Counsel. Geoffrey comes from Bingham McCutchen but he had served as the CFTC’s head of Enforcement in the late ’90s. As far as I can remember, Geoffrey is the first senior SEC Staffer with a CFTC background. Maybe a merger of the SEC and CFTC is not far behind…

John Polise used to work at the CFTC and is now an Associate Director in OCIE. But he wasn’t originally hired at the SEC as senior staff.

Will the SEC’s New GC Earn More Than the SEC Chair? Not Likely But Other Staffers Do!

For 2013 – beginning the first applicable pay period beginning after March 27th – the SEC Chair, an Executive Schedule Level III position, will be paid $166,100, and the other Commissioners (an Executive Schedule Level IV position) will be paid $156,300 – and the GC job is an Executive Schedule position that makes less than the Chair. But some mid-level Staffers who have been around a long time make more than $200k (eg. long-tenured SK-17 Staffers) …

The SEC has a special pay schedule comparable to the Federal banking regulators – the S-K pay scale; not the GS scale that most federal employees get paid under. Plus Staffers receive pay plus a locality percentage based on their office location.

Webcast: “The Litigation Explosion in Executive Compensation”

There has been so much going on with the wave of “Say-on-Pay Litigation 2.0” (although the lawsuits are more than just say-on-pay related) that I have been tempted to blog about it daily (see this Mark Borges’ blog and this D&O Diary Blog – as well as this list of cases posted by Faruqi & Faruqi and our own list & memos in’s “Executive Compensation Litigation Portal“).

But I have held off blogging because I knew you could tune in tomorrow for the webcast – “The Litigation Explosion in Executive Compensation” – to hear Orrick Herrington’s Rick Gallagher, Simpson Thacher’s Joe McLaughlin and Paul Hastings’ Mark Poerio discuss what is involved in the rash of new executive compensation-related lawsuits, as well as how to handle them. Please print off these “Course Materials” in advance.

– Broc Romanek

January 7, 2013

Delaware’s New Voluntary Disclosure Program: Is Delaware Really Going Soft on Escheatment?

Last year, I blogged about how Delaware was getting greedy when it came to escheatment. As noted in this memo, in an effort to stem the backlash from Fortune 500 companies incorporated in Delaware, the state is attempting to save face by adopting a sweeping new Voluntary Disclosure program. This new program potentially differs substantially from the approach of the contingent fee contract auditors that Delaware has long relied on for audit enforcement of its unclaimed property laws. For companies that meet the new Voluntary Disclosure requirements and enroll by June 30th, Delaware will reduce the liability reachback period by 15 years, from 1981 to 1996, and waive all interest and penalties.

However, it remains to be seen whether this new VDA program is in fact a legitimate path for fully and finally resolving outstanding unclaimed property obligations, or instead a mechanism by which Delaware secures information to be used in a future audit – a criticism that has often been levied at Delaware’s precursor VDA process.

IFRS Foundation Staff’s Analysis of SEC Staff Final Report on IFRS

Last month, the IFRS Foundation Staff released analysis of the SEC Staff’s July 2012 final report on incorporating IFRSs into the U.S. financial reporting system. The analysis concludes that “[w]hile the size of the US economy relative to other jurisdictions presents significant challenges in transition that are unique to the US, the experience of other countries suggests that many of the challenges can be overcome with the appropriate political will to make a commitment to the mission of a single set of global standards.” Here is the IASB’s press release.

Transcript: “How the SEC Really Works”

We have posted the transcript for the recent webcast: “How the SEC Really Works.”

– Broc Romanek

January 4, 2013

Should the SEC Be Giving Investment Advice?

Maybe this has been happening for a while but this bulletin from the SEC’s Office of Investor Education & Advocacy caught my eye because it provides year-end investment considerations. It dishes out advice similar to the type you get from your broker – asset allocation, rebalancing and tax considerations (even mentioning the fiscal cliff). Is this the type of thing that a federal agency should be doing? And as long as the SEC is going over the basics of conventional wisdom, shouldn’t it mention to “buy low and sell high”?

CII Petitions SEC for Rule 10b5-1 Guidance

Last week, the Council of Institutional Investors submitted this rulemaking petition to the SEC to tighten rules on 10b5-1 plans (here’s a Cooley news brief that describes the petition). Personally, I think we need to see more evidence of abuse beyond the recent WSJ article that piggybacked on this academic study. Anyways. learn more about what you can do to protect yourself know if the wake of all this interest during our upcoming webcast: “Rule 10b5-1 Plans Under Attack: The Latest Practices.”

Renew Now for ’13: Grace Period Ends Late Today!

As all memberships expired on December 31st, please renew now if you haven’t yet renewed your membership for for ’13. The grace period for this site will end on Monday night – and you will need to renew to access these upcoming programs:

“Dissecting the Quarterly Earnings Process” (1/10)
“The ‘Former’ Corp Fin Staff Speaks” (1/16)
“Pat McGurn’s Forecast for 2013 Proxy Season: Wild and Woolly” (1/24)
“Rule 10b5-1 Plans Under Attack: The Latest Practices” (2/5)
“Conduct of the Annual Meeting” (3/5)

– Broc Romanek

January 3, 2013

Corp Fin’s New Position on Use of “Vote All of Board’s Recommendations” Button

Recently, Broadridge sent this letter to companies explaining a big change going forward over how voting choices will be displayed. Here is an excerpt from the letter:

Broadridge, transfer agents and other service providers in the proxy distribution industry were recently informed of a new interpretive position being taken by the staff of the SEC that will affect the 2013 proxy season. Under that position, Broadridge and other service providers can no longer present shareholders with a “Vote with the Board’s Recommendations” button when soliciting proxies or voting instructions online, over the telephone, or through Broadridge’s unique mobile voting platform, unless they are also presented with a “Vote Against the Board’s Recommendations” button.

Over the course of the last several months, Broadridge has engaged in an extensive dialogue with the Broadridge Independent Steering Committee, as well as with the SEC, to better understand the SEC’s new interpretive position and to explore ways that it could accommodate the SEC’s new position in light of its potentially negative impact on retail voting. Due primarily to technical complications presented by director election proposals and the Dodd-Frank required say on pay frequency vote, the presentation of a “Vote Against the Board’s Recommendations” option was not currently feasible. Accordingly, after careful consideration, we have developed a new structure to implement this new interpretation to, our online voting platform, Mobile ProxyVote, our mobile voting platform and to IVR, our telephone voting platform. Under this new structure, ProxyVote, Mobile and IVR will be revised as follows: – The “Vote with the Board’s Recommendations” button has been removed and has been revised to more closely track the presentation of voting options on proxies and voting instruction forms (VIFs). Specifically, as is currently the case with respect to proxies and voting instruction forms, shareholders are presented with the option of voting on each item individually and are informed of the Board’s voting recommendations with respect to each of the items for which their votes or voting instructions are being solicited. Shareholders are encouraged to vote individually and are informed that if they select the “Submit” button without selecting any items individually, their proxies and voting instructions will be cast in accordance with the recommendations of the board of directors.

Mobile ProxyVote – The “Vote with the Board’s Recommendations” button has been removed and shareholders are presented with the option of voting on each item individually. Shareholders also are informed of the fact that their votes or voting instructions will be cast in accordance with the recommendations of the board of directors as a consequence of their not voting on each item individually. Shareholders are presented with a link to another page where they can see the recommendations of the board on an item-by-item basis and vote in accordance with such recommendations by selecting the “Submit” button without voting on each item individually.

IVR – Telephone voting will be revised to encourage shareholders to vote individually but will allow shareholders to submit votes or voting instructions without voting individually. Shareholders will need to affirmatively elect not to vote individually. If they do so, they are informed that their votes and voting instructions will, as a consequence, be cast in accordance with the recommendations of the Board of Directors.

This change in position is important as it has the potential to swing more votes than nearly any disclosure in the proxy statement would…

Please take a moment to participate in our “Quick Survey on Internal Audit” and “Quick Survey on Shareholder Engagement.”

How Corp Fin’s “Voting Button” Position Could Impact the Upcoming Crowdfunding Rulemaking

Perhaps how the SEC tackles crowdfunding will be a sign of whether its regulatory approach is evolving more broadly when it comes to regulating the online display of disclosures since crowdfunding naturally lends itself to the Web, social media and the Internet in general. An evolution is not evident in its proposed rulemaking under Section 201 of the JOBS Act (here’s a recent NY Times article about a delay in that rulemaking) – but it still could happen over the next few years since crowdfunders are likely to innovate online in ways that traditional investment banks haven’t…

Cybersecurity Act Dies for Second Time

In my opinion, one of the biggest risks to companies – and our country for that matter – is cybersecurity. Disclosure along these lines has improved since the SEC’s interpretive guidance a year ago, but I do think more needs to be done. But I wasn’t surprised that “The Cybersecurity Act of 2012” failed for the second time in the Senate despite calls from the Administration to pass a bill. It will probably take a major catastrophe to pass something. It is unclear whether the President will issue an Executive Order to create a voluntary set of security standards for major infrastructures, etc. Meanwhile, Fortune 500 companies still need to respond to Senate Rockefeller’s letter.

– Broc Romanek