TheCorporateCounsel.net

June 5, 2013

Lessons Learned: Be Careful in Your Electronic Communications

Recently, Alan Dye blogged about “SEC Loses Argument that Employee was a Section 16 Officer” on his Section16.net Blog and y’all should read that as it’s good to know. Although the SEC almost never challenges a company’s designation of its executive officers, there are clearly exceptions to this rule of thumb. I’ve posted the court decision – SEC v. Gary Prince – in our “Executive Officer” Determination” Practice Area.

My lessons learned from this case relate to the quite detailed description in the court opinion about the deliberations of whether Gary Prince should have been deemed a Section 16 officer by the law firm and the company. Starting at page 35 and going on for at least 8 pages is a description of the action taken by the law firm weighing in on whether disclosure was necessary. Scary for those of you in firms. Here’s a statement from Alan at the end of his blog that hammers this point home:

The decision also offers a lesson in communications between outside counsel and a corporate client and communications among law firm lawyers in developing their advice to a client. The court lays out a pattern of communications between Integral Systems and its outside counsel in which the company sought the firm’s concurrence that Prince was not an executive officer, but resolution of the issue was left unclear at best.

More on “SEC Extends Comment Period on Proxy Fees”

Recently, I blogged that the SEC has extended the comment period on the proxy fee proposal that has been outstanding for a while. The Society of Corporate Secretaries has posted this interview with Time Warner’s Paul Washington – who chaired the Proxy Fee Advisory Committee -, about what is at stake for companies in this proxy fee proposal. Paul is persuasive – particularly at the end – and it would be unfortunate if the fee proposal is turned down. There should at least be a clear and short timeline for getting a better structure approved.

Webcast: “Conflicts of Interest: How to Handle in Deals”

Tune in tomorrow for the DealLawyers.com webcast – “Conflicts of Interest: How to Handle in Deals” – to hear Steven Haas of Hunton & Williams, Mike Reilly of Potter Anderson and Melissa Sawyer of Sullivan & Cromwell discuss how boards deal with conflicts of interests in the wake of El Paso, Del Monte and Southern Peru, including in relation to stapled financing.

– Broc Romanek