Legal Developments

SEC Proposed Exemption Provides Regulatory Clarity For Unregistered Finders

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On October 7, 2020, the Securities and Exchange Commission (SEC) voted to provide much needed clarity to the regulatory status of so-called “finders” who assist small businesses in raising capital. In a 3-to-2 vote, the SEC proposed a Finder exemption to the broker-dealer registration requirements of Section 15(a) of the Securities Exchange Act of 1934 to allow unregistered natural persons, referred to as finders, to engage in certain limited activities to assist issuers in raising capital from accredited investors.

Executive Private Misconduct

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A file folder with the word "Private" on the front

In recent years, private misbehavior of corporate executives like Harvey Weinstein, Steve Wynn, Leslie Moonves, and Elon Musk has outraged many people around the world. Such misconduct – when made public – has frequently damaged the executives’ public reputations, diminished the value of their companies’ stock, and raised some serious legal and policy issues. Part of the challenge in dealing with misbehaving business executives is that the two bodies of law and regulation that govern much of American business – state corporate law and federal securities law – were largely designed to address the professional duties of executives and not their personal lives. Temple Law Professor Tom Lin proposes an original and workable roadmap for conceptualizing, navigating, and addressing executive private misconduct.

Publication of the Model Business Corporation Act Annotated (5th edition)

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The 5th edition of the MBCAA of course contains the full text of the Model Act, reflecting all amendments and Official Comments through July 1, 2020, including the substantial revisions effected by the 2016 revision of the Model Act, and more recent additions such as the provisions authorizing virtual-only shareholder meetings and public benefit corporations. Extensive additional resources, however, distinguish the newly published MBCAA from other published versions of the Act and, indeed, from other corporate law treatises.

SEC Expands the Definition of Accredited Investor

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SEC rules governing accredited investors are designed to protect individual investors from risks that could result from the lack of regulatory oversight associated with unregistered private securities offerings. By expanding the definition of “accredited investor,” the SEC has provided more investors with the opportunity to access alternative investments and given companies, private-equity firms, and hedge funds access to a larger pool of investors.

SEC Adopts Amendments to Regulation S-K Items 101, 103, and 105

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Under the rule amendments, the SEC significantly revised public company business disclosure rules for the first time in more than 30 years. The amendments were crafted from a proposed rule released in August 2019 that was part of a comprehensive review by the SEC of the disclosure requirements per a study mandated by the JOBS Act.

Leveling The Playing Field-U.S. Court Jurisdiction Over Disputes Between American Professional Athletes And Foreign Sports Teams

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This article, which explores federal court jurisdiction over foreign business entities in the context of an American professional baseball player’s lawsuit against a Japanese professional baseball team and its corporate owner, uses the decision of the District Court finding personal jurisdiction over the team, but not its owner, as a springboard for a broader discussion of the jurisdictional issue. It explores the various analyses that are employed by courts in the Third Circuit and other Circuits, focusing particularly on the interactive nature of websites as a basis for the exercise of personal jurisdiction.

Federal Circuit Throws Shade on TTAB’s Treatment of Color Trademarks

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Pink insulation, green tractors, robins-egg blue jewelry boxes—they all have something in common: recognizable colors that many associate with products. But can colors be registered as trademarks and, if so, when? On April 8, 2020, the United States Court of Appeals for the Federal Circuit provided welcome guidance for trademark owners and practitioners on the nuanced area of protecting trademarks consisting solely of colors.