BLT: May 2015



Business & Corporate

So, You Want to Invest in a Bank or Bank Holding Company . . .

This article provides a brief overview of the questions and analyses that need to be considered by investors and acquirers prior to making an investment or seeking to purchase a bank or bank holding company supervised by the Federal Reserve. There are a number of questions that need to be asked from the outset to make the regulatory process as smooth and predictable as possible for investors and acquirers.


Fiscal Sponsorship: What You Should Know and Why You Should Know It

Fiscal sponsorship is a contractual relationship that allows exempt activities to be advanced by an entity that is not itself tax-exempt with the benefit of the tax-exempt status of a sponsor organization. It can be a great tool for fulfilling charitable and philanthropic intentions. Understanding the various forms of fiscal sponsorship, and how to properly structure them, will enable you to provide counsel to your clients regarding how to best achieve their charitable goals.


Business & Corporate

KEEPING CURRENT: It Keeps Going and Going and Going: Second Circuit Reaffirms Stringent Scienter Standard for Securities Fraud Claim Against Auditors of Battery Company

In the recent decision of In re Advanced Battery Technologies, Inc., the Second Circuit affirmed the denial of a motion to amend a dismissed Section 10(b) and Rule 10b-5 class action complaint against a pair of auditor defendants because of inadequate scienter allegations. The decision emphasizes the high bar a plaintiff must overcome to allege scienter against independent auditors and rejects the use of an accounting expert’s conclusory opinion to bolster allegations of reckless and unreasonable conduct.

Business & Corporate

KEEPING CURRENT: SEC Announces First Enforcement Action Involving Restrictive Language in Confidentiality Agreement under Dodd-Frank Whistleblower Program

On April 1, 2015, the SEC announced its first enforcement action under the Dodd-Frank whistleblower program involving restrictive language in an employee confidentiality agreement that it contends has “the potential to stifle the whistleblowing process.” During internal investigations, a company had required employee witnesses to execute a form confidentiality agreement prohibiting them from discussing the internal investigations with outside parties without prior approval of its legal department. The agreement further stated that unauthorized disclosure “may be grounds for disciplinary action up to and including termination of employment.”

Business & Corporate

DELAWARE INSIDER: Defining a Proper Purpose for Books and Records Actions in Delaware

Pursuant to Section 220 of the DGCL, stockholders of Delaware corporations have a qualified right to access certain nonpublic information under the control of the company. This article will address two recent cases from the Delaware Court of Chancery which address what constitutes a “proper purpose” for a Section 220 inspection. Both cases offer valuable guidance to stockholders and their counsel regarding the proper purposes for asserting Section 220 inspection rights.

Business & Corporate

ETHICS CORNER: The Rivera Precedent: What You Don't Know Can Hurt You

A prominent law firm is retained by a corporation to defend a sexual/employment discrimination claim. The law firm then contacts employees with first-hand knowledge of the facts. Assuring these individuals that it sees no conflict of interest, the law firm offers to represent them at the corporation’s expense, which the individuals agree to. Plaintiff’s counsel discovers this multi-representation arrangement and moves to disqualify the law firm for purported ethical violations. Could the law firm’s actions possibly violate the “non-solicitation” rule?