Tag Archives: Michael Scanlon

SEC Releases Final Clawback Rules

by Sean Feller, Krista Hanvey, Elizabeth Ising, Ronald Mueller, Michael Scanlon, Lori Zyskowski, Aaron Briggs, and Christina Andersen

On October 26, 2022, the Securities and Exchange Commission (“SEC” or “Commission”), in a 3-to-2 vote, adopted final rules that will require listed companies to implement policies for recovery (i.e., “clawback”) of erroneously awarded incentive compensation, implementing Section 10D of the Securities Exchange Act, which was added by Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”).[1]  The SEC originally proposed clawback rules on July 14, 2015,[2] but the proposed rules remained dormant until October 14, 2021, when the SEC reopened the comment period[3] (and which was reopened for a second time on June 8, 2022).[4]  The final rules add new Exchange Act Rule 10D-1 (“Rule 10D-1”), which largely tracks the long-pending proposed rules but also incorporate terms previewed in the 2021 release reopening the comment period.

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China Constricts Sharing of In-Country Corporate and Personal Data Through New Legislation

by Patrick F. Stokes, Oliver Welch, Nicole Lee, Ning Ning, Kelly S. Austin, Judith Alison Lee, Adam M. Smith, John D.W. Partridge, F. Joseph Warin, Joel M. Cohen, Ryan T. Bergsieker, Stephanie Brooker, John W.F. Chesley, Connell O’Neill, Richard Roeder, Michael Scanlon, Benno Schwarz, Alexander H. Southwell, and Michael Walther

The People’s Republic of China is clamping down on the extraction of litigation- and investigation-related corporate and personal data from China—and this may squeeze litigants and investigation subjects in the future.  Under a new data security law enacted late last week and an impending personal information protection law, China is set to constrict sharing broad swaths of personal and corporate data outside its borders.  Both statutes would require companies to obtain the approval of a yet-to-be-identified branch of the Chinese government before providing data to non-Chinese judicial or law enforcement entities.  As detailed below, these laws could have far-reaching implications for companies and individuals seeking to provide data to foreign courts or enforcement agencies in the context of government investigations or litigation, and appear to expand the data transfer restrictions set forth in other recent Chinese laws.[1]

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Protecting Client Privilege During UK Regulatory Investigations: A Cautionary Tale from the UK’s Audit Regulator

by Susy Bullock, Patrick Doris, Michael J. Scanlon, Monica K. Loseman, David C. Ware, and Jonathan Cockfield

On June 10, 2020, Mr. Justice Trower, sitting in the English High Court, handed down his judgment in A v B [2020] EWHC 1491 (Ch). The judgment addressed the treatment of privileged documents that had been disclosed to an auditor by their clients under a limited waiver, with a finding that it was for the auditors (and not their clients) to decide, objectively, if the relevant materials could be withheld on the grounds of privilege, or should be disclosed to the Financial Reporting Council.

The judgment has implications for communications between clients and their auditors, and the practicalities associated with the sharing of privileged information in connection with audits and audit procedures performed in the United Kingdom.

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