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 MoreThe year 2021 proved to be a significant year for cryptocurrency (“crypto”). (Nikita Prasad, NDTV). With El Salvador becoming the first country to use Bitcoin as their legal currency and Tesla, Inc.––one of the world’s most valuable companies––accepting Bitcoin as payment, public interest and the potential for general mainstream acceptance have grown exponentially. Id. This increase in popularity has unsurprisingly exposed crypto to the focus of the Internal Revenue Service (“IRS”) because of the present need for tax dollars and governmental spending. (Alex Gailey & Kendall Little, Time; Robert W. Wood, Forbes). . .
Read MoreThe Securities and Exchange Commission (“SEC”) released a vindicatory letter to China-based issuers demanding increased disclosures and financial reporting requirements. (U.S. Securities and Exchange Commission). The SEC’s letter took considerable jabs at the Chinese infrastructure that has stalled the Public Company Accounting Oversight Board (“PCAOB”) from auditing the Chinese issuers’ public accounting firms. (U.S. Securities and Exchange Commission). The letter demands that disclosures from China-based issuers include disparaging warnings indicating the lack of enforcement mechanisms and risks associated with a “less developed legal system.” (U.S. Securities and Exchange Commission). . .
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. . .
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