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A Most Nescient Comment?

Monday was the close of the comment period on the Securities and Exchange Commission’s proposed rules with respect to listing standards requiring recovery of erroneously paid incentive compensation. In addition to myself, several commenters pointed out that the proposed rules make no allowance for state law.  I noted a potential conflict with California Labor Code…

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Conduct Unbecoming Of An Officer And An Employee?

In proposing executive compensation recoupment rules, the Securities and Exchange Commission either overlooked or failed to recognize an important legal distinction.  The proposed rules would require national securities exchanges and national securities associations to establish listing standards requiring each issuer to develop and implement a policy providing for the recovery, under certain circumstances, of incentive-based compensation based on financial…

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What The SEC Pretermitted In Proposing A Clawback Policy Rule

The Securities and Exchange Commission began the month by issuing proposed rules that would direct national securities exchanges and associations to establish listing standards requiring companies to adopt policies that require executive officers to pay back incentive-based compensation that was awarded erroneously.  Five years ago, Congress ordered the SEC to adopt these rules in Section 954 of the…

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Ninth Circuit Holds Private Company Rules Preempt California Law

California’s Statutory Prohibition on Forced Patronage California Labor Code Section 450(a) forbids employers from coercing the patronage of their employees:  It provides: “No employer, or agent or officer thereof, or other person, may compel or coerce any employee, or applicant for employment, to patronize his or her employer, or any other person, in the purchase…

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