SEC Enforcement

It is no secret that the incoming Republican Administration has been skeptical of the federal government’s climate change measures, which brings further uncertainty to the SEC’s new climate change rules (the “Rules”).  To be sure, there was already uncertainty surrounding litigation in the 8th U.S. Court of Appeals over the Rules’ validity. 

The new…

Following its adoption almost one year ago of amended rules accelerating filing deadlines for Schedules 13G and 13D (and the imminent effectiveness of the new deadlines for 13Gs), the SEC has continued to bring enforcement cases focusing on the timing of initial filings, amendments, and transitions from Schedule 13G to 13D, as well as Section…

Last week, the SEC publicly announced a settled enforcement case against Keurig Dr. Pepper.  The case focused on the company’s disclosure in its annual reports on Form 10-K on whether its K-Cup pods could (or would) be recycled.  The SEC action focused on allegedly incomplete disclosure:  In testing the reliability of recycling K-Cup pods, the…

As reported today, Vice President Harris has announced Tim Walz, the sitting governor of Minnesota, as her running mate. This announcement is particularly significant for investment advisers due to the Advisers Act Political Contributions Rule, otherwise known as the “pay-to-play” rule.

Read the full post on The Capital Commitment blog.

On June 28, 2024, the U.S. Supreme Court issued a landmark ruling overturning “Chevron deference,” a tool for interpreting ambiguous statutes administered by administrative agencies.  The 40-year-old Chevron doctrine held that, where a court finds a statute to be silent or ambiguous on a particular matter, the court must defer to the relevant agency’s construction of the statute if that construction is “permissible.”  The Supreme Court’s decision in Loper Bright Enterprises v. Raimondo now rejects any such deference to the agency and requires courts to apply their own construction of the silent or ambiguous law, even if the agency’s contrary view is reasonable and “permissible.”

On June 14, 2024, the SEC announced an enforcement action settlement with a Pennsylvania-based hedge fund manager for violating the Marketing Rule under the Investment Advisers Act. The SEC found that the adviser had misled investors by advertising a hedge fund’s investment performance based on the investment performance of a single investor in the fund. …

As we reach the midpoint of 2024, the SEC’s enforcement actions continue to shape the private funds industry. From the continuing off-channel recordkeeping sweep to heightened scrutiny on AI claims, fiduciary obligations of fund managers, and insider trading, the SEC is as vigilant as ever. Compounding these efforts are significant variables, such as the upcoming…

The SEC’s recent settlement involving a “pay-to-play” rule violation by a private equity firm is a timely reminder for fund managers, especially with the November elections approaching. 

As a refresher, Rule 206(4)-5 of the Investment Advisers Act – known as the “pay to play” rule – prohibits investment advisers from receiving compensation for providing advisory…

Proskauer’s Hedge Fund Trading Guide offers a concise, easy-to-read overview of the trading issues and questions we commonly encounter when advising hedge funds and their managers. It is written not only for lawyers, but also for investment professionals, support staff and others interested in gaining a quick understanding of the recurring trading issues we tackle for clients, along with the solutions and analyses we have developed over our decades-long representation of hedge funds and their managers.