Tag Archives: Charles D. Riely

Do Your ESG Disclosures Need Leveling Up? Leading Video Game Company Faces SEC Investigation into Its Harassment and Discrimination Disclosures as It Reaches $18 Million Settlement with EEOC

by Anne Cortina Perry, Anthony S. Barkow, Charles D. Riely, Lori B. Day, Tali R. Leinwand, and Anna Windemuth

Recent activity by two federal regulators underscores an increasingly obvious reality: when a company is confronted with harassment and discrimination complaints, government agencies will scrutinize its response and may bring enforcement actions. For months, video game maker Activision Blizzard (“Activision”) has been dealing with negative publicity and litigation relating to allegations that it allowed pervasive sexual harassment and discrimination to occur and failed to appropriately respond. Just three weeks ago, Activision confirmed that the US Securities and Exchange Commission (“SEC”) was investigating the sufficiency of its disclosures.[1] In the latest news concerning the company, Activision publicly disclosed two weeks ago that it was resolving a case with the US Equal Employment Opportunity Commission (“EEOC”) by making an $18 million payment to establish a victim fund.[2] This client alert analyzes these developments, the other civil and regulatory issues faced by Activision, and discusses steps companies can take when confronted with harassment or other work conduct allegations.

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The Key Open Questions That Will Determine the Next Four Years of SEC Enforcement

by Charles D. Riely and Michael F. Linden

As President Biden’s administration gets into full swing, many expect future Chairman Gary Gensler’s SEC to take a more aggressive approach to enforcement. Public companies and other market participants are left wondering what, exactly, that means. In this post, we take a detailed look at where the SEC is starting from, what has happened since January 20th, where it goes from here, and what interested parties should be watching for as the “new” SEC ramps up. Continue reading →

Insider Trading Issues Raised by News of Senators’ Reported Trades

by Stephen L. Ascher, Charles D. Riely, and Jeremy H. Ershow

As the world coped with the Coronavirus (COVID-19) pandemic, news spread that four senators made well-timed sales of well-chosen securities before the market started its precipitous decline—at a point in time when the federal government was still minimizing the risk of a pandemic. While the political condemnation was swift and definitive, the question of liability for insider trading is more nuanced and fact-intensive: if the senators are investigated by the Department of Justice or Securities and Exchange Commission (SEC), counsel will likely argue that the information the senators had was already in the public domain. The key issue will be whether the closed-door briefings included distinctive nonpublic facts that gave the senators unique insight into the impending crisis and its likely impact on securities markets. Several senators have also stated that the securities trades were made by others. These assertions will likely be tested by a detailed reconstruction of the communications between the senators, their family members and any others responsible for administering the accounts. Even if the senators prove somebody else placed the trade, investigators will carefully review whether the senators tipped any material nonpublic information to the people managing their accounts. Ultimately, legal liability is less assured than the political fall-out. Continue reading →