SEC Shareholder Proposal Amendments Challenged by Senate Democrats


On March 25, 2021, Ohio Senator Sherrod Brown, introduced a joint resolution disapproving several recent amendments to Rule14a-8, which significantly raised the holding and time requirements in order to have a shareholder’s proposal included in proxy materials.  

Under the “Congressional Review Act”, “[a] rule shall not take effect (or continue), if the Congress enacts a joint resolution of disapproval . . . of the rule.”  5 U.S.C. § 801(b).  Moreover, any rule disapproved of by Congress “may not be reissued in substantially the same form, and a new rule that is substantially the same as such a rule may not be issued” without explicit authorization by law.  Id.  

As required by the “Congressional Review Act”, the joint resolution has been referred to the Committee on Banking, Housing, and Urban Affairs for consideration.  

Progress of the Joint Resolution, along with its original text, can be found here.
 

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About Michael Van Gorder

Michael Van Gorder's practice is focused on securities litigation. Michael is a Partner in the firm's Delaware office. Prior to joining F&F, Michael served as a law clerk to the Honorable James T. Vaughn, Jr. of the Delaware Supreme Court (2015-16). While attending law school, Michael served as the Editor-in-Chief of the Delaware Journal of Corporate Law and was selected as a Josiah Oliver Wolcott Fellow with the Delaware Supreme Court. Before law school, Michael worked in the private bank of a global financial services firm where he held multiple securities licenses.Michael has authored the following article: Boilermakers v. Chevron: Are Board Adopted Arbitration Bylaws Valid Under Delaware's General Corporation Law?, 39 Del. J. Corp. L. 443 (2014).Michael received his J.D., magna cum laude, from Widener University School of Law (2015). Michael received his B.S., Business Management, 2008; M.B.A., Finance, 2011, from Wilmington University. Michael is licensed to practice law in the state of Delaware and is admitted to the United States District Court of Delaware.

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