It’s nice that we have a year where there are no major updates to SEC regs or stock exchange listing standards requiring us to draft entirely new sections of Form 10-Ks or proxy statements. But there are a few funky things about 2025 that will need to be considered for particular disclosure updates, as Liz noted last week. Here’s another great reminder from this Mayer Brown alert that may not be top-of-mind.
– Certifications, Exhibits, Signatures and Consents. Interestingly, growing areas of SEC Staff comments include the certifications, exhibits, signatures and consents to expertised portions of a filing, including consents of subject matter experts and counsel. In terms of the certifications required by Item 601(b)(31) of Regulation S-K, the Staff often comment when the language of the certification does not exactly match the language of Regulation S-K, or when the language has been incorrectly modified.
In terms of exhibits, the Staff will often comment if an exhibit is missing, for example, when a material contract was entered into or amended during the reporting period and not filed as an exhibit. The same stands true for expertized consents—where the findings or opinion of an expert, such as a tax or mining expert, for example, are included or summarized in the filing, the company must include the expert’s consent as an exhibit to the filing.
And here’s more on a topic that Liz mentioned last week:
– EDGAR Next Transition Delays and Regulation S-K Item 405 Implications. Some [EDGAR Next] bottlenecks, combined with the September 15, 2025, deactivation of legacy filing access codes for submissions, resulted in late Section 16(a) reports for many companies and insiders who could not timely complete EDGAR Next onboarding or obtain new credentials. Companies should be mindful of the Regulation S‑K Item 405 implications in their 2026 proxy statements. Item 405 requires disclosure of any known failures to file timely Forms 3, 4 or 5 during the most recent fiscal year, including identification of the reporting persons and the number of late reports and transactions.
In preparing 2026 proxies, issuers should carefully reconcile insider reporting logs against EDGAR timestamps, assess whether delays were attributable to EDGAR Next transition issues, and include required delinquency disclosure where appropriate. Even if transition delays may have been operational in nature, Item 405 is a bright-line, disclosure‑based requirement. Therefore, issuers should treat EDGAR Next-induced late filings no differently from other late filings and make clear, accurate delinquency disclosures in their 2026 proxy statements.
Check out our “Proxy Season” and “Form 10-K” Practice Areas, where we’re posting all the related resources.
If you deal with shareholder proposals in your practice, you do not want to miss today’s webcast – “This Year’s Rule 14a-8 Process: Corp Fin Staff Explains What You Need to Know” – to hear from Corp Fin Chief Counsel, Michael Seaman, and Corp Fin Counsel, Emma O’Hara, on how the Staff will handle the Rule 14a-8 process for the 2026 proxy season in light of Corp Fin’s new statement. Cooley’s Reid Hooper and Gibson Dunn’s Ron Mueller will also give their perspectives on strategy and how issuers should be thinking about and approaching the new process, with our own Liz Dunshee moderating.
I look forward to hearing about how the Staff is working through its post-shutdown backlog, the expected substance of the notice submitted by companies under this year’s approach, what language should be included for the “unqualified representation,” what to do after submission, what happens if there’s a withdrawal and the carve-out for Rule 14a-8(i)(1) requests.
Keep in mind these few important differences from our typical programming:
1. This webcast is free for anyone who wants to attend, even if you aren’t currently a member of this site. We want to do what we can to get the word out about the Staff’s approach so that the season is as smooth as possible for everyone (especially given the Staff’s workload after the shutdown).
2. It’s happening from 11:00 am – 12:00 pm Eastern.
3. Since this is a pop-up webcast, we aren’t offering CLE credit for this one.
If you’re hunting for CLE credits by the end of the year, remember that members of this site can earn live and on-demand credits through our other programs. As you can see on our home page, we have two live CLE programs in December, including:
– “The (Former) Corp Fin Staff Forum” webcast at 2 pm ET on December 11th featuring former Corp Fin Senior Staffers discussing the SEC’s regulatory agenda, recent Staff guidance, shareholder proposals, filing reviews and what might be coming down the pipe in 2026; and
– Our “Anatomy of a Shelf Takedown” webcast at 2 pm ET on December 18th featuring experienced capital markets partners discussing legal and practical issues involved in a shelf takedown of debt or equity securities.
Last week, the website on SEC.gov that houses shareholder proposal no-action letters was updated. To reflect the new process for the 2026 season, the shareholder proposal no-action letter page now directs to this site, which gives a quick summary of the past and present approaches:
Companies intending to exclude shareholder proposals from their proxy materials must notify the Commission and provide the information required by Exchange Act Rule 14a-8(j) no later than 80 calendar days before filing their definitive proxy materials.
Historically, most Rule 14a-8(j) notifications took the form of no-action requests where companies asked the Division of Corporation Finance to state its informal, non-binding views on whether it concurred that there was a legal basis to exclude shareholder proposals from their proxy materials under Rule 14a-8. On November 17, 2025, the Division announced that during the 2025-2026 proxy season it will not respond to no-action requests related to any basis for exclusion other than Rule 14a-8(i)(1). The Division will continue to respond to Rule 14a-8(i)(1) no-action requests until such time as it determines that there is sufficient guidance available to assist companies and proponents in their decision-making process.
The Division also will respond to Rule 14a-8(j) notifications when a company or its counsel includes, as part of the notification, an unqualified representation that the company has a reasonable basis to exclude the proposal.
The site then directs you here for Rule 14a-8 correspondence and Division responses, which includes four separate sites for:
As Liz shared last week, at least one Rule 14a-8(j) notice & response had already been posted on the SEC’s website, although it related to a pending, and already posted no-action request submitted prior to the Staff’s statement, so it wasn’t entirely clear until this page was rolled out that all the notices & responses would be posted. It now looks like they will be.
There are a number of other procedural questions floating around, and I’m excited to hear from SEC Staff during tomorrow’s TheCorporateCounsel.net webcast, “This Year’s Rule 14a-8 Process: Corp Fin Staff Explains What You Need to Know.” Tune in from 11:00 am – 12:00 pm Eastern to hear Corp Fin Chief Counsel, Michael Seaman, and Corp Fin Counsel, Emma O’Hara, address some frequently asked questions from our own Liz Dunshee, Cooley’s Reid Hooper and Gibson Dunn’s Ron Mueller, who will also give their perspectives on strategy and how issuers should be thinking about and approaching the new process.
Keep in mind that this webcast is free — even for folks who aren’t members of TheCorporateCounsel.net. There’s no need to register in advance, even if you are not a member. But head to the webcast landing page linked above to add the webcast to your calendar so you don’t miss it! (I know if I don’t get a 15 min. prior reminder pop-up, I won’t show up anywhere!) This webcast also won’t be eligible for CLE credit — but we have lots of other options, both coming up live (see the home page) and on-demand — if you need that!
Stock buybacks — which were already trending in 2025 toward an all-time high — are getting another boon. The Treasury Department & the IRS recently released final regulations, effective on November 24, 2025, that provide guidance on the application of the 1% excise tax on stock buybacks by public companies. As this Debevoise article explains, the final regulations pare back many provisions that attracted taxpayer comments on the 2024 proposal. For example:
Funding Rule: The Final Regulations limit the international reach of the Buyback Tax by removing a controversial “funding rule” which appeared nowhere in the statute and which applied the Buyback Tax to the repurchase of public foreign stock by a foreign issuer if the proceeds of the repurchase were sourced from its U.S. affiliates.
Comment: The removal of the “funding rule” is a welcome relief, as it might have applied to buybacks that were determined to be funded with distributions from U.S. subsidiaries and ordinary course cash management and treasury functions. However, the Buyback Tax still applies to purchases of public foreign corporation stock by the corporation’s U.S. affiliates.
Preferred Stock: While the Final Regulations continue to apply the Buyback Tax to repurchases of preferred stock, they exempt the redemption of nonvoting, debt-like preferred stock from the application of the Buyback Tax. The Final Regulations also exempt the redemption of stock issued prior to the passage of the Buyback Tax on August 16, 2022, if such stock is subject to a mandatory redemption by the issuer or a unilateral put by the holder.
Comment: Public issuers of PIPEs or SPACs with redeemable shares that were issued prior to August 16, 2022, will now be able to redeem such shares without paying the Buyback Tax.
There’s other good news:
A corporation that has previously paid the Buyback Tax but would not be required to do so under the Final Regulations may receive a refund by filing an amended quarterly return after the effective date of the Final Regulations.
While most of us public company securities lawyers may not spend our day-to-day thinking about how audit firms might be subject to liability for statements in their clients’ IPO registration statements, that potential for liability certainly does impact the day-to-day of public companies and their lawyers because (I assume) it is something the higher-ups at audit firms think about. So here’s an interesting development out of the 9th Circuit, explained by this Morgan Lewis alert:
After Bloom Energy issued revisions to its 2016 and 2017 financial statements and a restatement of its 2018 and 2019 financial statements, Bloom stockholders amended an existing securities class action to add claims under Section 11 against the accounting firm that audited Bloom’s 2016 and 2017 financial statements. The case centers on the accounting for Managed Services Agreements (MSA) that Bloom used in connection with sale-leaseback arrangements . . .
In their complaint, plaintiffs alleged the accounting firm was liable under Section 11 for purportedly actionable statements and omissions in Bloom’s registration statement regarding its accounting for MSAs because the audit opinion did not identify that Bloom should have classified the MSAs as capital leases instead of operating leases. The accounting firm moved to dismiss, and the District Court granted the motion. Rather than amend their complaint, plaintiffs appealed to the Ninth Circuit.
On appeal, plaintiffs did not challenge the District Court’s dismissal of their claim that the audit opinion itself was false or misleading apart from its certification of the financial statements. . . Rather, plaintiffs argued that the accounting firm should be strictly liable under Section 11(a)(4) of the Securities Act for the misstatements in Bloom’s financial statements.
In early November, in Hunt v. PricewaterhouseCoopers LLP, the 9th Circuit rejected this argument and reiterated the negligence standard for accountant liability under Section 11:
Section 11 includes a due diligence defense, which requires that “accountants … exercise due diligence in investigating the materials provided to them using the accepted practices of their profession.” Accordingly, Section 11 imposes a negligence standard for an accountant’s liability, and in order for plaintiffs to prevail on a Section 11 claim, they must establish that an accounting firm did not have a “reasonable ground to believe” and did not believe, “at the time such part of the registration statement became effective, that the statements therein were true.”
But what about the claim that the audit opinion itself was false or misleading?
The Ninth Circuit next addressed applicability of the Supreme Court’s 2015 decision in Omnicare . . . in which the Supreme Court excluded statements of opinion from liability under Section 11 . . . Hunt was the first time the Ninth Circuit had occasion to consider applicability of Omnicare to auditors.
Without hesitation, the Ninth Circuit “extend[ed]” the holding in Omnicare to accountants and noted that doing so is consistent with Section 11’s due diligence defense. The Ninth Circuit held: “accountants may be liable for statements of fact if they did not act with due diligence; however, accountants will not be liable for statements of opinion, even if they reflect a subjective belief that admits there is a possibility of error, as long as the statement of opinion was sincerely held.”
Finally, the Ninth Circuit clarified that an “accountant’s certification of financial statements is nothing more than an opinion,” and held that, in this case, the accounting firm could not be liable for its audit opinion because that opinion “did not make any material misstatements of fact or omissions but rather was merely a statement of opinion based…upon the subjective judgment of the MSA classification.”
[Plus] Bloom’s determination of whether the accounting standards mandated that Bloom treat the MSAs as capital leases or operating leases involved significant accounting judgments, which rendered those determinations opinions, not facts. [So] Omnicare doubly applied because the accounting firm’s audit report was an opinion on top of company management’s opinion.
And thank goodness! Because the alert says:
Section 11 does not “make accountants guarantors of every statement made by the issuer; to make such a holding would turn the whole accounting world upside down” and make audits prohibitively expensive.
That was fast! Yesterday, ISS announced the annual updates to its benchmark proxy voting policies – which will apply to shareholder meetings taking place on or after February 1, 2026. As always, ISS had sought comments on potential changes. That comment period just ended a couple weeks ago, so I personally was not expecting the updates to land before Thanksgiving, and I guess this early delivery is one more thing to be thankful for if you are celebrating the holiday tomorrow.
ISS provided a 19-page summary to recap the main changes for all policies globally. Additionally, this 35-page document takes a deeper dive into what’s changed for the Americas region – including the US – and the rationale for those changes. It also includes redlines that show the year-over-year updates.
All in all, there weren’t too many corporate governance-related updates for US companies – and all of the updates were on topics that were part of the comment period, so no surprises. But check out Meredith’s blog today on CompensationStandards.com for takeaways on compensation-related policy updates, which were more extensive. Based on ISS’s summary, here are the main takeaways on the governance front, which track with what ISS had proposed during the recent comment period:
– Problematic Capital Structures – Unequal Voting Rights: Eliminates inconsistencies in the treatment of capital structures with unequal voting rights by considering them problematic regardless of whether superior voting shares are classified as “common” or “preferred.”
– E&S-related Shareholder Proposals: Adopts a fully case-by-case approach for proposals on diversity, political contributions, human rights, and climate change, reflecting varied proposal scope, shifting investor sentiment, regulatory changes, and evolving company practices. On a global basis, ISS has also reinforced the use of a common set of evaluation factors and specifically notes consideration of whether a proposal may substantively affect shareholder rights or interests.
For more color on the ISS policy updates – and themes to expect during the 2026 proxy season – make sure to mark your calendar for our January 8th webcast – “ISS Policy Updates and Key Issues for 2026.” This is one of our most-loved programs each year. It features Marc Goldstein, Managing Director & Head of U.S. Research at ISS, Davis Polk’s Ning Chiu, and Jasper Street Partners’ Rob Main. Members can attend the webcast at no charge. If your membership is expiring at the end of the year, make sure to renew it in time to catch this important program! And if you aren’t yet a member, sign up today by emailing info@ccrcorp.com or calling 800.737.1271.
Yesterday, the SEC announced that its Investor Advisory Committee will hold a virtual public meeting next Thursday, December 4th at 10 am ET. The agenda includes three hot topics:
1. Panel discussion on regulatory changes in corporate governance – exploring the evolving corporate governance landscape, including key changes to the shareholder proposal process, the use of mandatory arbitration clauses, investor corporate engagement, and modifications to the proxy voting system. James Andrus is moderating a discussion with Leza Bieber of Freshfields, Brad Goldberg of Cooley, shareholder advocate Jim McRitchie, and Vice Chair of ValueEdge Advisors and prominent corporate governance commentator Nell Minow.
2. Panel discussion on tokenization of equities – discussing the development of tokens representing ownership of an asset, and how tokenization can improve how public equities are currently issued, traded and settled – including market structure issues like settlement and short-selling.
3. Potential recommendation from the Committee on the Disclosure of Artificial Intelligence’s Impact on Issuer Operations – considering a draft recommendation urging the SEC to require companies to disclose how they define artificial intelligence, board oversight mechanisms, and other matters, which came out of the Committee’s March 6, 2025 panel discussion on this topic.
Ready or not, the holidays are upon us. I’m very grateful for all of you, as well as my family, friends and all of the same stuff that you’ll find on gratitude lists around the country. As your intrepid blogger during this holiday week, I am also counting my lucky stars for this Bloomberg article, which quotes Peter Atwater calling the marriage between crypto treasury companies and SPACs a “financial turducken.” I think that term might take off almost as much as the “K-shaped economy” that Peter also defined.
We’ve written about this trend a couple of times already, so I won’t belabor the explanation. As we’ve noted, SPACs have made a bit of a comeback this year – and the article gives the latest stats:
More than 110 SPACs raised $23.3 billion in the first 10 months of 2025, a far cry from the roughly $162 billion pooled across 613 in 2021, but easily outpacing the activity in the last two years combined, according to SPAC Research. The stream of deals has maintained a solid clip, with 59 SPAC mergers inked this year through October.
Of course, the real point of this blog is to share this important turducken history, in case you need something to talk about tomorrow with your friends & family:
The turducken, if you’ve managed to avoid its company thus far, is exactly what it sounds like–a chicken stuffed into a duck stuffed into a turkey, all deboned and layered with various types of stuffing. It looks like a regular turkey, but, when cut, magically reveals its true soul (the duck), as well as its soul’s soul (the chicken). It would fit nicely next to a Midwestern dessert salad, but is also the kind of main course you’d expect from a Thanksgiving feast thrown by the psychedelic machine minds at Google Deep Dream. In short, it is a truly mysterious food, melding the nostalgic with the futuristic, the traditional with the impossible.
The carnivore-baiting chimera has been a gold-plated staple of New Orleans cuisine since 1980, when Chef Paul Prudhomme began serving up a Cajun-inflected version in his restaurant, K-Paul’s Louisiana Kitchen. Prudhomme trademarked the name in 1986, and we’ve been calling it that ever since.
I blogged a few weeks ago about how the Enforcement Division is getting “back to basics” under SEC Chair Paul Atkins (and new Enforcement Division Director, Military Judge Meg Ryan, who was sworn in shortly before the government shutdown). A new report from Cornerstone Research and the NYU Pollack Center for Law & Business puts a finer point on the trend line. Here’s an excerpt from Cornerstone’s press release:
The U.S. Securities and Exchange Commission (SEC) brought 30% fewer enforcement actions against public companies and subsidiaries in FY 2025 than in FY 2024—a decline that coincided with the change in SEC administration.
While a decline aligns with previous years in which there was an SEC administration change, FY 2025 stood out for its composition: outgoing Chair Gary Gensler oversaw 52 actions (93%), while only four were initiated under the new SEC administration—the highest and lowest respective totals for outgoing and incoming chairs during a transition year since at least FY 2013.
Here are a few other takeaways:
– Monetary settlements are 45% lower than FY 2024: Total monetary settlements of $808 million in FY 2025 are the lowest since FY 2012 and the second lowest in SEED. This is also less than half of the FY 2016-FY 2024 average total monetary settlement of $1.9 billion.
– Chair Atkins to Focus on Issuer Reporting and Disclosure: Three of the four actions initiated against public companies and subsidiaries after Chair Gensler’s departure involved Issuer Reporting and Disclosure allegations. This is expected to continue into FY 2026. In his May 2025 remarks, Chair Atkins signaled his administration would “return” to the “core mission that Congress set” for the SEC—prioritizing “protecting investors; furthering capital formation; and safeguarding fair, orderly, and efficient markets.”
– Final Off-Channel Communications Sweep Under Chair Gensler: The SEC initiated nine actions in January 2025 as part of Chair Gensler’s off-channel communications sweep—an area that Chair Atkins indicated interest in addressing in remarks made in October 2025.
– Cooperation and Admissions of Guilt Continued Under Chair Gensler: The SEC noted cooperation by 73% of public company and subsidiary defendants that settled in FY 2025, higher than the FY 2016–FY 2024 average of 65%—reflecting the SEC’s continued emphasis on cooperation under Chair Gensler.
– Record-Low Disgorgement and Prejudgment Interest: The total amount of disgorgement and prejudgment interest ($108 million) was the lowest in any fiscal year in SEED — more than $300 million below the next-lowest total in FY 2012.
– Civil Penalties Continued in Administrative Proceedings: FY 2025 civil penalties for administrative proceedings accounted for the highest percentage of the total monetary settlement for any fiscal year in SEED.
Last week, the Ninth Circuit Court of Appeals granted part of an appeal by the US Chamber of Commerce and other trade organizations, arising out of their challenge to California’s climate disclosure laws. Here’s more detail from PracticalESG.com:
On Tuesday, the Ninth Circuit issued an order temporarily staying California’s SB-261 requiring biennial climate risk reporting by companies “doing business” in the state. Prior to the court’s ruling, companies were to publish their initial SB-261 report by January 1, 2026. This blog from Gunderson Dettmer gives background and explains what happens now:
“The motion was denied for SB-253 (GHG emissions reporting). SB-261 enforcement is now paused while the Ninth Circuit considers whether to reverse the district court’s August decision.
The case is scheduled for oral argument on January 9, 2026 — after the January 1 compliance date — though this date could change or the court could decide on the briefs. During today’s CARB workshop, staff indicated they are reviewing the order, and it remains unclear whether updated SB-261 guidance will be issued.”
The emergency application to the US Supreme Court Zach wrote about Tuesday has been withdrawn, although the industry groups that filed the original application stated they may “renew[] their request for relief if necessary at a later stage of the litigation.”
Members of PracticalESG.com can learn more about California’s climate disclosure laws here.
The case is Chamber of Commerce of the United States of America v. California Air Resources Board. As noted above, the court issued its order at the same time that CARB was holding a public workshop about implementation of the laws. This King & Spalding memo summarizes takeaways from the workshop and says:
It is possible CARB may issue an advisory following the Court’s injunction. In the meantime, while some companies may decide to report on or before January 1, 2026, at least by posting a link on their website, many other companies are likely to wait for further developments from the appellate Court or CARB. Notably, the Ninth Circuit did not stay a second California disclosure law, SB 253, that requires certain companies to disclose Scope 1 and 2 greenhouse gas emissions. Since the Ninth Circuit declined to also stay SB 253, companies should continue to plan for compliance with that law by August 10, 2026 (based on recent guidance from CARB).
We’re continuing to track the ins & outs of these developments – and share practical guidance about what companies should be doing – on PracticalESG.com. If you aren’t already a member of that site, email info@ccrcorp.com, call 800-737-1271, or start your membership online today.
