Piwowar Seeks More Disclosure From Banks In Lieu of Other Regulation
In this WSJ piece, Andrew Ackerman describes this speech by SEC Commissioner Michael Piwowar:
Policy makers at the Federal Reserve and their counterparts at the Securities and Exchange Commission have fundamentally different approaches to regulation: The Fed focuses mainly on assessing how safe banks are, the SEC primarily on what companies disclose to markets. Given the two camps don’t always see eye to eye , it’s no surprise SEC officials have often chafed over efforts by the Fed to apply its prudential approach to the capital markets, particularly for asset-management firms. Now a top SEC official, Michael Piwowar, is pushing back — and, in a twist, pressing for more SEC-like regulation of banks.
Mr. Piwowar’s argument, fleshed out in a speech this summer in London, boils down to this: After a plethora of new and costly banking regulations since the financial crisis, regulators still have done very little to remedy the dearth of public information about the banking sector. Many investors see big banks as black boxes. Public mistrust of banks remains high. The solution, according to Mr. Piwowar, is for the SEC to use its authority over publicly traded firms to pull back more of the curtain on banks’ inner workings, just as it forces the companies it oversees to inform investors about factors that could hurt profits.
“Rather than imposing prudential regulation on markets, requiring banks to comply with the disclosure-oriented focus of market-based regulation would provide better protection to the financial system,” he said.
Mr. Piwowar outlined a handful of areas ripe for improved disclosures. They include more details about the loans banks make and the securities they hold as investments, as well as results of the Fed’s big-banks stress tests and granular details of their “living wills,” or plans to go through bankruptcy without needing taxpayer money. A fifth area involves greater disclosure of “material” regulatory costs, in terms of direct expenses as well as “opportunity costs” resulting from new regulatory requirements.
Cap’n Cashbags: Nepotism Reigns
In this 45-second video, Cap’n Cashbags – a CEO – hires three sons who probably aren’t qualified:
It seems that ever since Congress passed Dodd-Frank, the House GOP has been trying to repeal major chunks of it. This year is no exception. As noted in this Reuters article, the House Financial Services Committee has passed the “Financial CHOICE Act of 2016” (which I’ve blogged about several times before – remember my reference to choking a horse; see this MarketWatch article). Here’s a new letter from CII opposing the bill…
Do CEOs Sway Political Choices of Their Employees?
Given the season we are in – and the heated debate over whether companies should disclose their political contributions – I was struck by this study entitled “Do CEOs Affect Employee Political Choices?” – here’s the abstract ( & here’s a MarketWatch piece):
We analyze how political preferences of CEOs affect their employees’ campaign contributions and electoral choices. Employees donate almost three times more money to CEO-supported political candidates than to candidates not supported by the CEO. This relation also holds around CEO departures, including plausibly exogenous departures due to death or retirement. CEO influence is strongest in firms that explicitly advocate for political candidates and firms with politically connected CEOs. Finally, employees are more likely to vote in elections in those congressional districts in which CEOs are more politically active. Our results suggest that CEOs are a political force.
My own personal experience has been mixed. In a modestly-sized law firm, the managing partner strongly encouraged us to donate money to a particular candidate in another state (I declined). At a Fortune 50 company, we were encouraged to register & vote – but we were never influenced about which party or candidate to vote for. My wife worked for a small business where all employees were strongly encouraged to donate to a candidate – with the subtle promise that a bonus would be forthcoming in about the same amount at the end of the year…
Poll: Have You Ever Been Swayed About How You Vote or Donate?
Please take a moment to participate in this anonymous poll:
The SEC has adopted an interim final rule to adjust for inflation the maximum civil money penalties payable for violations of the federal securities laws. The adjustments were mandated by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.
The adjustments most pertinent to Section 16(a) compliance are those made to the monetary penalties the SEC may impose in cease and desist proceedings brought under Section 20C of the Exchange Act, since most enforcement actions that are based solely on Section 16(a) violations are brought under Section 20C. Section 21B(a) of the Exchange Act permits the SEC to impose a civil money penalty in a cease and desist proceeding brought under Section 20C if the SEC finds that the respondent is violating or has violated a provision of the Exchange Act (including Section 16(a)) or is or was a cause of such a violation. Section 21B(b) prescribes three tiers of penalties, depending on the nature of the violation, and establishes a maximum penalty for each tier. Each maximum penalty is subject to adjustment upward for inflation.
Here are the three tiers and the new maximum penalty amounts. The maximum penalties prior to the recent adjustments are set forth in parentheses:
– First tier is available for any type of violation, and permits a fine of up to$8,908 ($7,500) per violation for a natural person and $89,078 ($80,000) per violation for any other person.
– Second tier is available only for violations involving fraud, deceit, manipulation, or deliberate disregard of a regulatory requirement, and permits a fine of up to $89,078 ($80,000) per violation for a natural person and $445,390 ($400,000) per violation for any other person.
– Third tier is available only if the requirements for the second tier are met and the violation resulted in substantial losses or a significant risk of substantial losses to other persons. Fines for third tier violations can range up to $178,156 ($160,000) per violation for a natural person and $890,780 ($775,000) per violation for any other person.
More on “Armageddon for ADRs”
Last month, I blogged about the SEC’s Enforcement Division having issued wide-ranging subpoenas to the four largest ADR banks. I don’t know if its directly related – but yesterday, the SEC announced that a Portuguese-based telecommunications company has agreed to pay a $1.25 million penalty for its failure to properly disclose the nature & extent of credit risk involved in an ADR offering (technically it was an ADS offering – “American Depository Shares”)…
FYI: Conference Hotel Nearly Sold Out
As always happens this time of year, our Conference Hotel – the Hilton Americas – Houston – is nearly sold out. Our block of rooms is indeed sold out – but there are still rooms outside our block available at essentially the same rate. Reserve your room online or by calling 713.739.8000. If you have any difficulty securing a room, please contact us at 925.685.9271.
And if you haven’t registered for the October 24-25th conference, register now. If you really want to go, but you’re having budget issues – drop me a line…
While I was on vaca, the SEC issued this fee advisory that sets the filing fee rates for registration statements for 2017. Right now, the filing fee rate for Securities Act registration statements is $100.70 per million (the same rate applies under Sections 13(e) and 14(g)). Under the SEC’s new order, this rate will go up to $115.90 per million, a 15% hike. This offsets last year’s 13% drop.
As noted in the SEC’s order, the new fees will go into effect on October 1st like the last four years (as mandated by Dodd-Frank) – which is a departure from years before that when the new rate didn’t become effective until five days after the date of enactment of the SEC’s appropriation for the new year – which often was delayed well beyond the October 1st start of the government’s fiscal year as Congress & the President battled over the government’s budget.
The New “Investor Forum”
This blog by Francis Byrd described the essence of the new “Investors’ Exchange”:
An anticipated autumn announcement, reported in today’s FT, by a coalition of forty institutional investors – including BlackRock, the Wellcome Trust and Allianz Global Investors – amongst others may create a powerful opportunity for these top investors to manage their individual clout in a collective manner on ESG issues.
What makes this collaborative so different, you might say, from ICGN (or CII in the United States) or other regional groups of investors in Europe or Asia with ESG concerns? The primary difference, according the FT story, is that this collective will be exempt from restrictions limiting groupings of large investors from taking or indicating that they might take certain and specific actions in concert. For example, one could envision these 40 institutional investors issuing a statement of concern regarding executive compensation or perhaps on a proposed transaction, at a portfolio company, standing against the board’s recommendation, without running afoul of UK market rules designed to limit stock manipulation and insider trading by large shareholders working in concert.
While the FT story does not delineate the specific issues that the group of 40 would be able to act in concert on, it is likely to mirror the issues listed in the UK Investor Forum’s Collective Engagement Framework (ESG issues such as CEO compensation, CEO and independent director succession, strategy and performance, capital management, reporting and communications). The UK Investor Forum’s collective action plan would also allow for the participation of U.S. and foreign institutional investors. It must be noted that the Investor Forum’s Collective Engagement Framework was informed by consultation and collaboration between the largest UK corporate issuers, the biggest UK institutional investors and leading UK corporate lawyers.
Looks like Ralph Nadar is putting on a conference here in DC about giving power to the people. It includes some shareholder & whistleblower stuff – with Bob Monks & Jack Bogle, etc. speaking…
More on “The Mentor Blog”
We continue to post new items daily on our blog – “The Mentor Blog” – for TheCorporateCounsel.net 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:
– Issuing Shares Via Blockchain: Delaware Poised to Act
– Describing an Officer’s Duties 101
– Data Privacy: More Federal Agencies Join Enforcement Bandwagon
– Stats: Controlled Companies
– How Law Firms Should Strengthen Their Cybersecurity
Penny-stock firms, which regulators warn are more susceptible to manipulation by swindlers and company insiders, would be granted access to a regulatory shortcut for selling stock under legislation approved Thursday by the House of Representatives. The House voted 236-178, largely along party lines, to approve legislation that would allow microcap companies to tap a method of issuing shares that typically involves less oversight by regulators. Republicans who supported the legislation said it would allow smaller companies to use a fundraising tool that has so far been restricted to bigger companies. “Extending these cost-saving provisions to smaller companies that large companies are currently able to enjoy is absolutely critical, and makes a difference for in their ability to issue additional offerings, expand their business and create more jobs,” said Rep. Ann Wagner (R., Mo.), who sponsored the legislation. Only one Republican opposed it.
The bill, which doesn’t have a Senate sponsor, would allow microcap companies, including those that don’t meet exchange-listing standards, to offer stock on a rolling basis without having each sale approved by the Securities and Exchange Commission. The SEC defines microcaps as companies whose shares outstanding are valued at less than $300 million.
Meanwhile, here’s a letter from CII about the proxy advisors bill…
House lawmakers on Friday approved a bill to ease regulatory requirements on private-equity managers, legislation that the White House has threatened to veto. The House voted 261 to 145 to advance the bill sponsored by Rep. Robert Hurt (R., Va.), largely along party lines. The measure exempts private-equity firms from having to provide regulators with certain information, such as the debt levels of their portfolio companies and the countries where investments were made.
The legislation, which lacks a companion bill in the Senate and is opposed by the Obama administration, faces long odds of becoming law. Its likelihood of enactment hangs on the possibility of its provisions being added to a must-pass spending bill Congress often advances at the end of the year. The bill comes after years of failed attempts by the industry to exempt most managers of private-equity funds from having to register with the Securities and Exchange Commission. Instead, Friday’s legislation aims to roll back regulatory provisions that supporters say are unduly burdensome and crimp funds’ investment in companies that create jobs. Thirty-five Democrats supported the measure. Managers of private-equity funds pool their money alongside institutional investors such as pension funds and university endowments to buy equity stakes in companies or pieces of them.
Before Friday’s vote, the House agreed to modify some provisions that opponents found objectionable, approving by voice vote an amendment sponsored by Rep. Bill Foster, an Illinois Democrat. The amendment has the effect of preserving investor-protection rules set up in the wake of the Bernard Madoff Ponzi scheme. Those rules require that funds undergo a third-party audit or a surprise SEC examination to verify they actually own the assets they say they do.
2. The SEC proposes to mandate links to exhibits! A capital idea that was long overdue. I’ll be blogging more about my own ideas on this – & may even submit my 1st personal comment letter to the SEC about a rulemaking!
3. Corp Fin has been able to get out a slew of proposals despite the limitations of having only three sitting SEC Commissioners! Bravo!
4. While I was gone, John did a helluva job with the Penske file – but he clearly isn’t Penske material (I didn’t even know that Mr. Tuttle was finished interviewing)…
In June, the SEC adopted rules under the FAST Act permitting companies to include an optional summary page in their Form 10-Ks. As noted in this blog, Broc wasn’t all that excited since companies were permitted to voluntarily include summaries before this forced rulemaking. Anyway, this recent blog from the “SEC Institute” points out that for some companies, the decision about whether to include this summary may come down to a matter of disclosure philosophy:
To simplify a bit, some companies adopt a very “compliance” based philosophy for disclosure. In this model companies disclose what the SEC requires to be disclosed and essentially nothing more. This can be done in a fairly mechanical fashion and is usually very simple and direct, if not almost terse. At the other end of a disclosure spectrum some companies adopt a more “communications” based philosophy where they disclose more than the bare bones requirements in an effort to tell a more complete “story” of how their company operates.
What do these different approaches look like? To help answer that question, the blog compares the 10-Ks of two companies:
Here is a very well done example for Golden Enterprises of the compliance approach. Golden makes snack foods and does a simple, direct presentation.
Here is another well done example of a company (Square) that uses a more communications oriented approach. Square is a payment processor and supports businesses in many ways.
Companies that treat their Exchange Act filings as a communications tool often opt to disclose more in those filings than is technically required. It’s worth noting that some companies were including summaries in their 10-Ks long before the FAST Act – and the use of summaries in proxy statements has become widespread in recent years. These efforts reflect a desire to make filings more user friendly – and indicate that an increasing number of companies are taking a communications oriented approach to their filings. If that’s right, then the inclusion of 10-K summaries may well become a major trend over the next few years.
Here We Go Again(?) The GM Case & Bank Debt as a “Security”
This Kramer Levin memo describes a recent bankruptcy court decision in GM’s preference litigation that may call bank debt’s status as a “non-security” into question. Most people believe that this issue was put to rest long ago – and that ordinary course commercial bank lending does not involve the issuance of a “security.” The GM opinion suggests that this may not be the case – at least under bankruptcy law.
The status of GM’s bank debt became an issue because of defenses to preference claims raised by the company’s term lenders. The viability of those defenses turned on whether the payments in question were made pursuant to a “security contract.” In arguing that a security contract was involved, the defendants pointed to several factors, including the registration and active trading of interests in the term loans. That was enough to persuade the court that this was a live issue – at least for purposes of a motion to dismiss.
While GM involves only bankruptcy law, the case could be a very big deal if it leads to rethinking bank debt’s status under the securities laws – the memo notes:
If bank loans are securities for general securities law purposes, then a borrower could not “issue” bank loans except through a public offering, a Rule 144A offering or other private placement. Bank loans are syndicated without any of the documentation or approvals required for securities issuance. Worse, the agent bank routinely knows more about the borrower, under its confidentiality agreement, than the syndicate members to whom it sells the loan. Selling syndicate members have access to confidential data rooms and therefore may know more than outside buyers do. Thus if a bank loan is a security, every syndicating agent and every selling member of the syndicate courts liability under Section 10(b) and Rule 10b-5.
Some have suggested that concerns about the GM opinion may be overstated. As one of our members recently observed: “This case is getting a lot of play but I think it may overstate the risk. As you know, the SEC has considered syndicated loans to be securities for the purposes of the ’40 Act for almost 30 years.”
The New “Investors’ Exchange”: Should Companies Care?
This Sidley memo notes that after much back & forth, the Investors’ Exchange is up and running:
On September 2, 2016, the Investors’ Exchange, LLC (IEX) commenced full operations as a registered national securities exchange. After receiving over 400 comment letters during the SEC’s review and a spirited debate on equity market structure, the SEC approved IEX’s application to become a national securities exchange on June 17, 2016. As highlighted in the widely read book Flash Boys, by Michael Lewis, IEX employs a speed bump or delay on market participants accessing liquidity on IEX (IEX access delay).
The IEX had to adopt listing standards to get SEC approval – but it isn’t a “listing exchange” at present. The IEX’s purpose is to address the advantage provided to high frequency traders through their ability to access information milliseconds faster than other market participants on existing trading platforms. The Exchange’s CEO said that IEX “can help issuers improve their experience with the markets as well” – and the Exchange has promoted itself to public companies. For example, in this interview, IEX’s Chief Marketing Officer touted the benefits for public companies. Essentially, the pitch is that IEX is seeking to appeal to “buy & hold” investors, who are the kind of investors that companies want – and that its model will provide lower volatility and improved transparency.
Here’s the survey results from our survey about proxy mailing practices:
1. For our proxy materials, we file them:
– On same day we commence mailing of full sets – 76%
– At least one day prior to commencing mailing of full sets – 18%
– We do something different – 7%
– Not sure – 0%
2. We use notice & access (aka e-proxy):
– Yes – 79%
– No – 21%
– Not sure – 0%
3. We print this number of proxy materials to mail:
– Less that 25,000 – 66%
– 25,001 to 75,000 – 18%
– 75,001 to 150,000 – 10%
– More than 150,000 – 3%
– Not sure – 3%
As a follow-up to Broc’s blog on the recent Temple Inland decision, here’s the intro from this Morris Nichols alert about another decision on Delaware’s escheatment process:
On August 16, 2016, the US District Court for the District of Delaware issued an opinion in the case of Plains All American Pipeline, L.P. v. Cook granting defendants’ motions to dismiss federal Constitutional challenges to Delaware’s unclaimed property law for lack of subject matter jurisdiction where plaintiff failed to demonstrate that it had standing to assert such claims and that the claims were ripe for decision.
This decision is a significant follow-on to the Delaware District Court’s recent opinion in Temple Inland, Inc. v. Cook, to the extent that it clarifies and reinforces the State’s ability to estimate holder liability and rejects the use of the declaratory judgment action to challenge the audit process in advance of a demand for payment. Among the noteworthy rulings made by the Court are findings concerning a holder’s standing to sue third party contract auditors, the ripeness of challenges to unclaimed property audit methodologies (including estimation), and the constitutionality of the State’s selection of holders for audit.
Delaware’s aggressive approach toward unclaimed property shows no signs of abating. In fact – as this Reed Smith memo notes – it’s now moving against other states:
On May 26, 2016, Delaware filed a motion with the United States Supreme Court requesting leave to file a bill of complaint against other states regarding escheatment of uncashed “official checks.” Specifically, Delaware asserts in its motion that uncashed “official checks” should be escheated to the state where the check issuer is incorporated, not the state where the checks were purchased.
If Delaware is successful in getting the Supreme Court’s attention, this will be the first time the high court has addressed unclaimed property issues in almost 25 years, and the decision could have a major impact.
Here’s the registration information for our popular conferences – “Tackling Your 2017 Compensation Disclosures: Proxy Disclosure Conference” & “Say-on-Pay Workshop: 13th Annual Executive Compensation Conference” – to be held October 24-25th in Houston and via Live Nationwide Video Webcast. Here are the agendas – 20 panels over two days.
Discounted Rates – Act by September 9th – Only One Day Left!: Huge changes are afoot for executive compensation practices with pay ratio disclosures on the horizon. We are doing our part to help you address all these changes – and avoid costly pitfalls – by offering a reduced rate to help you attend these critical conferences (both of the Conferences are bundled together with a single price). So register by the end of tomorrow, Friday September 9th to take advantage of the 10% discount.
Last week, the SEC issued this proposing release that would require companies to include links to exhibits in most SEC filings. A rule like this would definitely make EDGAR filings more user-friendly. This blog by Davis Polk’s Ning Chiu summarizes the “clunky” way that EDGAR users currently navigate their way to a company’s exhibits:
Currently, anyone trying to access an exhibit that has been incorporated by reference instead of filed with the document must first review the exhibit index to determine which company filing includes a particular exhibit, and then search through the company’s Edgar history to find the exhibit. The SEC believes this process is burdensome, and has now proposed rules that would require a link to each exhibit listed in the exhibit index of any registration statement or report subject to Item 601 of Regulation S-K.
The current format also makes it a little cumbersome to access exhibits that are filed with the document itself – you have to find the exhibit you’re looking for in the document, then back out of the document to a page where separate links to each exhibit appear – and then click on the exhibit that you need.
One potential issue for some filers is that exhibits would need to be filed in HTML – since the ASCII format does not support hyperlinks. The SEC raised this issue in the release, but also noted that during 2015 – over 99% of all filings on the forms that would be affected by the proposal were filed in HTML.
This Simpson Thacher memo discusses guidance on the use of non-GAAP financial information in a new report issued by the “International Organization of Securities Commissioners” (known as “IOSCO”). The memo notes:
Because IOSCO is a consensus-driven supranational organization, its guidance is broader and less specific than the corresponding SEC guidance, and it is subject to interpretation and implementation by relevant national authorities.
Nevertheless, we expect IOSCO’s guidance will have substantial influence in European & other international markets, especially where national authorities have not previously issued their own specific guidance on the subject of financial measures not calculated in accordance with applicable accounting standards or principles.
The memo also notes that IOSCO’s report sets forth 12 principles intended help companies structure their non-GAAP disclosure in an understandable way, while avoiding confusion or misleading disclosures:
In general, the recent SEC guidance on the subject of non-GAAP financial measures is far more detailed and prescriptive than the IOSCO report. There are a number of points on which the SEC and IOSCO largely agree and overlap; however, some of the points emphasized in the SEC guidance do not find their way into the report’s 12 principles.
For example, the SEC’s warning against non-GAAP revenue measures which accelerate the recognition of subscription or long-term contractual revenue which the relevant GAAP requires to be recognized over time does not appear in the IOSCO report. Similarly, the SEC’s specific warning against presentation of non-GAAP liquidity measures on a per-share basis, the guidance on the definition of “funds from operations,” and the SEC’s discussion on the specifics of income tax adjustments each do not have direct parallels in the IOSCO report.
Webcast: “After Brexit! Current Developments in Capital Raising”
Tune in tomorrow for the webcast – “After Brexit! Current Developments in Capital Raising” – to hear Manatt Phelps’ Katherine Blair, Calfee Halter’s Kris Spreen and Davis Polk’s Michael Kaplan explore the latest developments in the capital markets, including alternatives such as PIPEs, registered direct offerings, “at-the-market” offerings, equity line financing and rights offers.
We recently learned that some companies have been contacted by the SEC’s Division of Enforcement concerning their non-GAAP disclosure practices. Enforcement’s interest appears to focus on Item 10(e) of Regulation S-K’s requirement that companies disclosing a non-GAAP measure in SEC filings and earnings releases must also present the most directly comparable GAAP measure with equal or greater prominence.
The disclosures being called into question were made in earnings releases – and predate the issuance of Corp Fin’s updated CDIs in May. Enforcement’s interest does not appear to have been prompted by the comment letter process, but instead seems to be the result of its own initiative. Could we be looking at a new sweep?
Although the disclosures that have been questioned were made within the last year, the companies under scrutiny are being asked to provide relevant documents covering multiple years. They are also being asked to identify any other instances of Reg G violations beyond those cited by Enforcement.
Public Benefit Corps: Pros & Cons
This Gibson Dunn memo discusses the pros & cons of the “public benefit corporation,” an alternative entity that is now an option in 30 states, including Delaware:
Although state corporate law statutes and the tax code treat PBCs as for-profit enterprises, the legal focus of this new corporate model contrasts with that of traditional corporation, which focuses solely on maximizing shareholder wealth. The PBC laws are designed to empower the board of directors to consider additional stakeholders alongside shareholders, and leave it to the board to determine the relative weight to place on shareholders’ and other stakeholders’ interests.
The advantages of the PBC form include more leeway to consider non-shareholder constituencies, possible increased interest from socially conscious investors, and additional takeover protection due to statutory limits on mergers with non-PBC entities. Disadvantages include possible hesitancy among traditional investors, legal uncertainties, additional reporting obligations, and complexities involving governance of PBC subsidiaries owned by traditional entities.
A number of large companies are experimenting with PBCs -and although there are no publicly-traded PBCs, that will likely change soon. Here’s a snapshot of the current PBC landscape:
As of August 2016, over 4,000 companies have formed as or converted to PBCs, including well-known consumer companies like Patagonia, Kickstarter, and Method Products. In August 2013, just after Delaware’s PBC statute became effective, Campbell Soup Company caused its newly acquired subsidiary, Plum Organics, to reincorporate as a PBC. Other public companies are similarly considering acquiring PBCs or converting subsidiaries to PBCs.
There are no publicly traded PBCs, but Etsy, which is certified as a “B Corp” by the non-profit entity B Lab, has gone public. According to B Lab rules, Etsy must convert to a Delaware PBC by August 2017 to maintain its certification.
You Have to Blow a Whistle to be a Whistleblower
This recent blog from “Jim Hamilton’s World of Securities Regulation” flags an interesting new federal court decision addressing what is & isn’t “whistleblowing.” The case – Verfuerth v. Orion Energy Systems – involves a pretty odd situation. As the court explained:
This case presents the unusual scenario in which a CEO claims to have been a “whistleblower” about his company’s failure to disclose material facts to shareholders during the same period he himself was certifying that his company’s disclosures were complete.
This case addressed the former CEO’s claim that the board terminated him for blowing the whistle on alleged securities fraud involving the company. The court was skeptical of his fraud claims – but it also believed that the whistle was never blown. It determined that the CEO’s allegations were premised solely on advice that he gave the board during internal discussions. Absent evidence that he communicated these concerns to the SEC, that wasn’t enough:
In sum, Verfuerth seems to have voiced disagreements with various board members about the company’s disclosure obligations, but simply telling someone he thinks they should disclose information is not blowing the whistle on anything. Essential to the concept of whistleblowing is the reporting of another person’s conduct to an appropriate entity, and there is no evidence that such activity occurred here.
There are two things that I know for sure. First, this duet between Ron Livingston of “Office Space” and Keyboard Cat is why Al Gore invented the Internet. Second, there’s no better way to kick off the Labor Day weekend than to watch it. Enjoy the holiday, everybody.