Sarbanes Oxley Act

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The Sarbanes-Oxley Act‘s legacy may be mixed in some important ways, but one of it more enduring aspects has been its requirement for publicly traded companies to have mechanisms to for employees report concerns anonymously and confidentially. Most companies now have ethics reporting hotlines – in fact, the SOX confidential reporting requirement has spawned an entire industry of third-party firms providing hotline services to public companies, according to a recent Wall Street Journal article. As the Journal article reports, these hotlines have in fact in some instance led to the uncovering of serious concerns, including even instance of accounting misreporting. The September 12, 2025, Journal article, which is entitled “Sex Scandals. Accounting Fraud. It’s All Showing Up on the Corporate Hotline,” can be found here.Continue Reading An Important and Enduring SOX Legacy: Ethics Reporting Hotlines

In the following guest post, Anne Catapano, VP Financial Lines Claims, Ascot Insurance Company, Christina Errico, VP, Professional Liability Claims Manager, Ascot Insurance Company, Elan Kandel, Member, Bailey Cavalieri LLC, James Talbert, Associate, Bailey Cavalieri LLC and Tyler Hopkins, Associate, Bailey Cavalieri LLC, review the past year’s key management and professional liability insurance coverage decisions. I would like to thank the authors for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ article.Continue Reading Guest Post: Year in Review: 2023 Key Management and Professional Liability Insurance Coverage Decisions

In the following guest post, Gregory A. Markel, Christopher F. Robertson, and David J. Winkler of the Seyfarth Shaw law firm take a look at the Second Circuit’s August 5, 2022 decision in Murray v. UBS Securities LLC. As the authors discuss, the Second Circuit’s ruling creates a split within the federal judicial circuits on the question of whether or not a SOX whistleblower retaliation claimant must prove retaliatory intent in order to prevail. I would like to thank the authors for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ article.
Continue Reading Guest Post: The Second Circuit Creates a Circuit Split on Whistleblower Claim Standards

financial statementsFinancial restatements among U.S public companies hit their lowest level in years in 2016, according to the updated annual report of Audit Analytics. As a result of heightened standards as well as the decreased numbers of listed companies, the share U.S. companies restating their prior financial statements hit their lowest level since 2010 and the number of companies restating their financials is at its lowest level since at least 2002. The findings are summarized in a June 12, 2017 Audit Analytics blog post (here). The full report can be found here (subscription or purchase required).
Continue Reading Financial Restatements Continue to Decline for U.S. Reporting Companies

enronFifteen years ago this month, the once high-flying energy company Enron completed its massive collapse when it filed a petition for bankruptcy protection. In his interesting December 2, 2016 post on the Harvard Law School Forum on Corporate Governance and Financial Regulation (here), Michael Peregrine of the McDermott, Will & Emery law firm takes a retrospective look at Enron’s downfall and suggests a number of different ways that those events have continuing relevance. As I discuss further below, there are, in addition to the considerations Peregrine notes, a number of other continuing legacies of Enron.
Continue Reading Enron’s Legacies, a Decade and a Half Later

bruce ericson
Bruce Ericson

Among the many issues arising under the Sarbanes-Oxley Act are questions surrounding disgorgement under Section 304, particularly questions concerning what actions and whose actions might trigger disgorgement. In the following guest post, Bruce Ericson of the Pillsbury Winthrop Shaw Pittman law firm takes a look at the Ninth Circuit’s August 31, 2016 decision in U.S. Securities & Exchange Commission v. Jensen in which the appellate court held that the SEC can seek disgorgement from a company’s CEO or CFO even if the triggering restatement did not result from those corporate officers’ misconduct. I would like to thank Bruce for his willingness to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Bruce’s guest post.
Continue Reading Guest Post: Ninth Circuit Clarifies What Might Trigger SOX 304 Disgorgement

supct2014Since their 2002 enactment, the whistleblower protections in Section 806 of the Sarbanes-Oxley Act have been presumed to apply only to employees of publicly traded companies. After all, the provisions are entitled “Protection for Employees of Publicly Traded Companies Who Provide Evidence of Fraud.” However, in its March 4, 2014 holding in Lawson v. FMR, …

magglassThe Sarbanes Oxley Act was enacted nearly twelve years ago in the midst of profusion of corporate scandals. Despite the passage of time, the Act has remained controversial. In order to evaluate the Act’s impact, Harvard Law Professor John C. Coates and Harvard Business School Professor Suraj Srinivasan undertook to review over 120 studies of …

In a November 13, 2012 opinion (here), Western District of Texas Judge Sam Sparks has upheld the right of the SEC under Section 304 of Sarbanes Oxley to seek to clawback bonus compensation paid to the CEO and CFO of Arthrocare, after the company restated its prior financial statements., even though the CEO…