Wave of Lawsuits Challenges SEC Rules Under Gensler’s Leadership
| 6 November 2024
U.S. industry groups and conservative organizations are pursuing numerous lawsuits against rules enacted under SEC Chair Gary Gensler, potentially reshaping the SEC’s regulatory agenda. Key contested rules include: Nasdaq Board Diversity: The Alliance for Fair Board Recruitment is challenging the SEC’s approval of Nasdaq’s diversity rule in the Fifth Circuit, causing delays to a similar SEC rule. Proxy Voting: The SEC prevailed in the Sixth Circuit, which upheld the agency’s repeal of Trump-era proxy voting regulations against a challenge from the U.S. Chamber of Commerce. Share Buybacks: In late 2023, the Fifth Circuit voided a rule mandating companies to disclose share repurchase data, finding the SEC did not justify the costs. Private Fund Disclosures: The Fifth Circuit struck down an SEC rule requiring more disclosures from private funds, ruling that the SEC exceeded its authority. Climate Disclosures: Industry groups and GOP-led states have taken the SEC’s climate disclosure rule to the Eighth Circuit, halting the rule pending court decisions. Future Proposals: Additional SEC proposals on issues such as AI, cybersecurity, and human capital management face opposition and legal hurdles, with critics claiming overreach. Supreme Court Rulings: Recent high court decisions, including SEC v. Jarkesy, restrict SEC powers, requiring jury trials in fraud cases and limiting rulemaking without explicit Congressional approval. As legal battles unfold, the future of Gensler’s agenda, especially on transparency and market oversight, remains uncertain. To find out more details please visit : https://www.reuters.com/ |