Elon Musk, with a net worth close to $240 billion, is not one to shy away from his dislike of the Securities and Exchange Commission (“SEC”). (Forbes, last visited Feb. 4th, 2022). As the CEO of Tesla, Inc. (“Tesla”), Musk has repeatedly tweeted comments that have affected both Tesla’s stock price and his reputation with investors. A tweet from November 6, 2021 regarding Tesla has caught the eye of investors, some of whom filed a Delaware lawsuit on December 16, 2021, alleging mismanagement of the company based on the tweet. (Mike Leonard, Bloomberg Law). The tweet polled Musk’s approximately 70 million followers asking if he should sell a tenth of his stake in the company, and 57.9% of those who viewed his poll voted for the sale. . .
Read MoreThe name “Special Purpose Acquisition Company” or “SPAC” has been around since the 1990s but only recently have these blank-check companies become popular enough to draw significant attention from investors and the Securities and Exchange Commission (“SEC”). (Holmes, Forbes). According to the SEC, a SPAC is a company with no operations that goes public for the sole purpose of acquiring a private company—effectively bringing the private company public. (Division of Corporate Finance Staff, SEC). SPACs offer an alternative to the traditional Initial Public Offering (“IPO”) route for taking a company public. (Frank Holmes, Forbes). While this alternative has its advantages, the SEC has begun taking action as it relates to SPACs and applicable disclosures. . .
Read MoreNasdaq adopted a new board diversity rule in August 2021 requiring greater diversity in the boardroom for companies listed on its exchange, with the focus of the new rule requiring increased representation and disclosure of board members who self-identify as a female, an underrepresented minority, or LGBTQ+. (Michael Nagle, Bloomberg Law; Securities and Exchange Commission). While these new requirements are a step in the right direction, there is a category of underrepresented individuals excluded from the existing diversity rules – people with disabilities. . .
Read MoreFacebook has once again found itself in the crosshairs of public discourse after a whistleblower was interviewed on “60 Minutes”. Frances Haugen (“Haugen”) is a former product manager at Facebook for the civic disinformation team. (Matt Levine, Bloomberg Law). Haugen shared in the interview that she was increasingly concerned with Facebook’s decision-making processes, which consistently choose profit over the public good. Id. Senators on a U.S. Senate subcommittee heard more than three hours of testimony from Haugen in which she provided specific examples of the impact of misinformation on teenagers’ mental health, and a lack of accountability on events in the United States. (Cecilia Kang, New York Times). Haugen brought internal documents and spoke candidly about the deliberate efforts Facebook makes to keep people, including children, hooked on their services. Id. She further said Facebook had hidden disturbing research about how teenagers felt emotionally worse about themselves after using its products, which include the popular social media app Instagram, and how Facebook was willing to use hateful content on its site to keep users hooked on its products. Id. . .
Read MorePandora’s box is a fictional artifact of Greek mythology. (Merriam-Webster). Pandora, the owner of the box, was told never to open the box. Id. However, she did anyway. Id. When she took the lid off the box, out swarmed all the troubles of the world, never to be recaptured. Id.
The recently revealed and appropriately named Pandora Papers have brought this Greek myth into a modern context, except evidence of global inequity swarmed out of the “box” in 2021. The Pandora Papers shocked many by describing how the ultra-rich hide money overseas to evade taxes. (Kelly Phillips Erb, Bloomberg Law). More surprising is the scale of the operation and how many well-known global figures participated in such dealings. . .
Read MoreWhile publicly-traded companies are coming under greater scrutiny and facing additional requirements to create diversity on their boards of directors (“boards”), private companies continue to skate under the radar on this front. One reason for this is that private companies do not face the same disclosure requirements that public companies do. (Ann Shepherd & Gené Teare, Crunchbase News). Another is that there is little information about the make-up of the boards of most private companies. However, in 2019 three organizations undertook a study of gender diversity of private company boards and built on that study in 2020 looking at both gender and racial and ethnic diversity. . .
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