On Thursday December 21, 2006, the parties to a case pending in the United States District Court for the District of Columbia will argue whether the Sarbanes-Oxley Act’s provisions establishing the Public Company Accounting Oversight Board (PCAOB) are unconstitutional. Although the case focuses on only a narrow part of the Act, it has the potential
Enron, Halliburton and the Milberg Weiss Criminal Investigation
Regular D & O Diary readers will recall my discomfort (as reflected here) with the Enron civil action plaintiffs’ leniency pleas on Andrew Fastow’s behalf at his September 26, 2006 sentencing. This week’s Fortune Magazine has an article entitled "Why Enron’s Fastow May Only Serve Five Years" (here), that explains how it
McNulty Memo Replaces Thompson Memo
As The D & O Diary has previously noted (most recently here), the Thompson Memo, the Department of Justice’s corporate criminality guidelines for prosecutors, has been the target of significant criticism. In the KMPG tax shelters prosecution, the judge found prosecutor’s implementation of the Memo to be unconstitutional (here). Most recently,
Notes from Around the Web
Lead Enron Plaintiff Moves to Dismiss Vinson & Elkins: In the serial retelling of the Enron collapse, the company’s outside professionals have been popular scapegoats, and among the most prominent targets has been the company’s former law firm, Vinson & Elkins. According to reports (here), between 1997 and 2001, Enron paid the
Second Circuit Rejects Class Action Against Underwriter Defendants in IPO Laddering Cases
According to reports in a December 6, 2006 article in the New York Times entitled "Court Rejects Class Action Against Banks" (here, registration required) and a December 6, 2006 Wall Street Journal article entitled "Wall Street Wins Ruling Blocking IPO Class Action" (here, subscription required) on December 5, 2006, the United
As International Investors Demand Greater Accountability, Will Legal Systems’ Differences Diminish?
Among the reasons behind the recent calls for regulatory reform, including the Paulson Committee’s Interim Report (here), is the belief that foreign companies are declining to list their shares on U.S. exchanges because of the burdens of U.S class action securities litigation. While the U.S. propensity for litigation may be deter some foreign
SOX Whistleblower’s Disclosures Lead to SEC Action
As The D & O Diary has previously noted (most recently here), many of the protections and benefits Congress hoped for from the Sarbanes Oxley Act’s whistleblower provisions have been slow to materialize. And there has been relatively little enforcement action or shareholder litigation arising from the revelations of SOX whistleblowers. But in one
Why Aren’t D & O Insurers Better Corporate Governance Monitors?
One of the great things about having a blog is that it has brought me into contact with a host of people I might otherwise never have gotten to know. Among the most interesting and colorful people I have met through my blog is Sammy Antar, Crazy Eddie’s cousin, and the author of the White
Looking at The Paulson Committee’s Proposed Litigation Reforms
As noted yesterday (here), the Committee on Capital Markets Regulation (often referred to as the Paulson Committee) has released its Interim Report (here). The Report contains much text, many graphics, and 32 recommendations supposedly addressed to how to improve the competitiveness of the U.S. securities markets. As proof that the U.S.
Paulson Committee Releases Interim Report
The Committee on Capital Markets Regulation (popularly known as the "Paulson Committee") has released its "Interim Report" (here). Weighing in at 148 graphic intensive pages, the 11.50 mb document is a memory hog. Readers who want a quick overview and don’t want to spend the rest of the day trying to download the