Media Mentions
2011
“Nonprofit Governance Trends to Look Out for in 2011”
Nonprofit Times, January 24, 2011
Michael Peregrine identified executive compensation, which “looked real good four years ago” but now is questioned because “it’s a very difficult time” economically, as a major concern for nonprofit boards. This typifies “more significant business issues that people didn’t get on the board to deal with,” he said, such as intellectual property and conflicts of interest. Mr. Peregrine noted that these issues “reflected the recession” because “charitable dollars are that much tighter.” Thus, he concluded, “boards are going to protect their own interests, even versus other charities,” in order to focus on “preservation of assets” – meaning “it’s a different board room atmosphere than ever before.”
Michael W. Peregrine, Corporate Responsibility and Governance, Nonprofit Organizations
2010
“SEC and Dodd-Frank Face Delays”
Marketplace Radio (American Public Media), December 28, 2010
Fredric (Rick) Firestone said that, by recently passing a budget that keeps federal spending at 2010 levels despite the increased enforcement requirements imposed on regulators by the Dodd-Frank Act, “Congress has, unfortunately, left the SEC in a little bit of a bind.” He noted that because the agency needs more funds for the expanded regulations and staff required by Dodd-Frank, “At a minimum, it certainly seems as if there's going to be some delay in how this is implemented.”
Fredric D. Firestone, Corporate Responsibility and Governance, White-Collar & Securities Defense
“SEC Non-Prosecution Deal Credits Extensive Cooperation”
Compliance Week, December 24, 2010
Fredric (Rick) Firestone asserted that the SEC’s first non-prosecution agreement with a publicly held children’s clothing marketer under its Enforcement Cooperation Initiative launched earlier this year “shows that the Commission wanted this case to get the attention of markets and public companies.” Calling the company’s alleged financial fraud and insider trading “isolated,” Mr. Firestone added that “it's an open question in cases of broader misconduct where a company provides extraordinary cooperation whether they'll be the beneficiaries of a non-prosecution agreement.”
Fredric D. Firestone, Corporate Responsibility and Governance, White-Collar & Securities Defense
“Prosecution of Former In-House Counsel Reflects Focus on Individual Accountability”
BNA Health Law Reporter, December 23, 2010
Michael Peregrine called the federal government’s prosecution of a drug company’s in-house lawyer for alleged false statements and obstruction of justice “a piece of a broader puzzle based in part on the responsible corporate officer doctrine,” and an action that “reflects the government’s heightened interest in fostering individual accountability … to target individuals … they believe are responsible for corporate misconduct.” Mr. Peregrine added the prosecution showed that “in-house lawyers need to educate senior executives to make sure they understand the importance of having the option of bringing in outside counsel in this [enforcement] environment.”
Michael W. Peregrine, Corporate, Corporate Responsibility and Governance
“Rule-Making Begins for Dodd-Frank”
Marketplace Radio (American Public Media), December 15, 2010
Fredric (Rick) Firestone, a former Associate Director of the SEC’s Division of Enforcement, said that “the rule-making requirements that have been imposed under the Dodd-Frank Act are historical.” Federal regulatory agencies have only a few months to shape the new rules required by the Act, and Mr. Firestone noted the benefits from companies offering comments as part of the process, saying, “It makes for better rulemaking at the end of the day if those who are impacted by the law have expertise on the issues.”
Fredric D. Firestone, Corporate Responsibility and Governance, White-Collar & Securities Defense
“High CEO Pay Not Always Reflective of Annual Earnings”
Chronicle of Philanthropy, October 3, 2010
Michael Peregrine was quoted in a story that examined specific nonprofit organizations that have come under critical public scrutiny for allegedly excessive executive compensation. He noted that such criticism may force boards of nonprofits to reexamine and restructure executive pay to head off potential public relations problems. “Boards are in an awkward place. They may have done exactly the right thing in past years, but that was then, this is now,” Mr. Peregrine said. “There has got to be a hard internal dialogue about the risk to the organization in the current environment. If you’re going to pay extraordinary dollars in deferred compensation or retirement benefits, you ought to start anticipating the fallout.”
Michael W. Peregrine, Corporate Responsibility and Governance, Nonprofit Organizations
“High CEO Pay Not Always Reflective of Annual Earnings”
Chronicle of Philanthropy, October 3, 2010
Michael Peregrine was quoted in a story that examined specific nonprofit organizations that have come under critical public scrutiny for allegedly excessive executive compensation. He noted that such criticism may force boards of nonprofits to reexamine and restructure executive pay to head off potential public relations problems. “Boards are in an awkward place. They may have done exactly the right thing in past years, but that was then, this is now,” Mr. Peregrine said. “There has got to be a hard internal dialogue about the risk to the organization in the current environment. If you’re going to pay extraordinary dollars in deferred compensation or retirement benefits, you ought to start anticipating the fallout.”
Michael W. Peregrine, Corporate Responsibility and Governance, Nonprofit Organizations
Fredric Firestone commented for Business Insurance (August 8) on the enhanced protections for whistle-blowers contained in the Dodd-Frank financial services reform law. Mr. Firestone cited “substantial additional safeguards for whistle-blowers in the form of specific, anti-retaliation protections,” which include awarding reinstatement, twice back pay owed and litigation costs/attorney’s fees to fired whistle-blowers who sue their employers over the dismissal.
Fredric D. Firestone, Corporate Responsibility and Governance, SEC Defense
Eugene Goldman was quoted by BNA Securities Regulation & Law Report (August 2) concerning what the SEC must do to implement the provisions of the Dodd-Frank financial reform act. The SEC is already seeking public input to harmonize the act’s fiduciary duty standards for brokers and investment advisers, and Mr. Goldman expects “robust comments from those who are concerned about a ‘one-size-fits-all’ universal fiduciary standard.” He also cited the agency’s efforts to invite pre-rulemaking comment on derivatives trading regulations, saying that “we are consulting clients about taking advantage of these opportunities” in the process. However, Mr. Goldman still sees potential problems in derivatives rulemaking because the regulatory jurisdictions of the SEC and the Commodities Futures Trading Commission “are not precise because of the similarities in products.”
Eugene I. Goldman, Corporate Responsibility and Governance, SEC Defense, Trial
Fredric Firestone spoke with the Washington Business Journal on July 26 concerning plans by the Securities & Exchange Commission to add up to 800 more positions to implement its new duties under the recently passed Dodd-Frank financial reform act. Mr. Firestone, former associate director of the SEC’s enforcement division, predicted that most of those new staff positions will be in the Washington, DC area, and that they will involve people with market and product expertise as well as lawyers and accountants.
Fredric D. Firestone, Corporate Responsibility and Governance, SEC Defense
Fredric Firestone talked on a July 26 Bloomberg Law Podcast about the Dodd-Frank financial reform act and its implications for managers of hedge funds and private equity funds. Mr. Firestone stated that the act will “substantially alter the regulatory landscape” for advisors to these funds, making them subject to comprehensive regulation by the Securities & Exchange Commission. “SEC registration and regulation is probably more painful than a migraine, but less painful than quadruple bypass surgery,” Mr. Firestone declared. “It is a resource- and document-intensive proposition that will be both expensive and time-consuming for advisors.”
Fredric D. Firestone, Corporate Responsibility and Governance, SEC Defense
Fredric Firestone was interviewed by Boardmember.com on July 21 concerning the whistleblower provisions of the Dodd-Frank financial reform act. He noted the "significant effect on public companies" of the act's provision that a whistleblower providing information on securities law violations could receive 30% of any recovery exceeding $1 million. Because such recoveries can be hundreds of millions of dollars, "[A] corporate insider whistleblower would potentially have a very large payday at the end of the process. So the types of cases and the potential recoveries involved have actually expanded and increased..." Mr. Firestone added that because this provision gives "incentive for corporate insiders to run to the government in the first instance [of a problem] rather than perhaps going within the company itself," it is "more imperative than ever that companies design and implement effective compliance programs and policies."
Fredric D. Firestone, Corporate Responsibility and Governance, SEC Defense, Securities Litigation
Michael Peregrine spoke to BNA Corporate Accountability Report (May 7) about amendments to the U.S. Sentencing Guidelines that require a direct reporting relationship between an organization’s chief compliance officer and its senior governance authority. “This is a pretty tight and unequivocal new requirement,” he stated, given that it “envisions a bona fide, inviolate reporting relationship between the compliance officer and the board or compliance committee.” He added that reporting now done through the CEO or General Counsel should be changed, because “there is little doubt that federal prosecutors and other investigators will henceforth examine the existence and substance of the compliance officer’s reporting relationship to the board in evaluating whether an effective compliance plan exists.”
Michael W. Peregrine, Corporate Responsibility and Governance
Ankur Goel was quoted on April 12 by Report on Medicare Compliance concerning the health reform law’s new Stark Law self-disclosure rules on reimbursement overpayments. He noted that the law now makes kickbacks with regard to illegal remuneration an explicit violation of the False Claims Act, and creates “a clear statutory requirement to repay overpayments. There is no ambiguity.” Because of these and other changes in the law, Mr. Goel said that “hospitals will want to step their game on the compliance side because the government’s tools are that much more powerful.”
Ankur J. Goel, Corporate Responsibility and Governance, Health
Ankur Goel spoke to BNA’s Health Care Daily Report (March 31) about the health care reform law’s expansion of the False Claims Act (FCA) and other enforcement mechanisms. “Anytime the government’s role in the health care system increases, so does its enforcement arsenal and compliance expectations,” he said, adding that all the compliance changes in the law “are consistent with that.” Mr. Goel specifically cited the law’s clarification that providers and suppliers must notify the government of an overpayment involving Medicare, Medicaid or the Children’s Health Insurance Program. “Congress has clearly foreclosed any debate or ambiguity about whether there is an obligation by expressly stating that the obligation creates a link to the FCA,” he stated.
Ankur J. Goel, Corporate Responsibility and Governance, Health
David Cifrino and Andrew Liazos were interviewed by Corporate Board Member on March 12 concerning new Securities & Exchange Commission (SEC) proxy rules that require disclosure of public company compensation programs that create risks likely to have a material financial impact. Mr. Cifrino noted that “if a company doesn’t say that it has any such risks … the SEC has said it will ask the company to explain what process was used to make that determination,” and Mr. Liazos added that “a significant amount of time and money will need to be expended in many cases in order to be able to demonstrate that a company’s compensation programs do not encourage excessive risk taking.” Both lawyers said the new rules will have a major impact on compensation consultants and board compensation committees.
David A. Cifrino PC, Andrew C. Liazos, Corporate Responsibility and Governance, Employee Benefits, Executive Compensation
Michael Peregrine was quoted by BNA’s Health Law Reporter (February 11) concerning the impact that changes to the federal sentencing guidelines could have on the compliance programs of hospitals and health systems. Mr. Peregrine said the changes emphasize that “the definition of what constitutes an ‘effective compliance plan’ … remains living, breathing and subject to periodic modification.” He noted that some elements of effectiveness include a strong document retention program and a direct compliance officer reporting relationship to the board of directors. Mr. Peregrine added that the guidelines also cite self-reporting, cooperation with authorities and restitution of damages as desirable responses after an organization detects criminal conduct.
Michael W. Peregrine, Conflicts of Interest - Health, Corporate Responsibility and Governance, Health
Michael Peregrine was quoted in a January 18 Modern Healthcare article about a not-for-profit health system’s purchase of a stake in a health and wellness company whose CEO had sat on the health system’s board but resigned after the board voted to make the purchase. While not commenting on the transaction directly, Mr. Peregrine noted that not-for-profits must adhere strictly to conflict of interest policies in transactions involving board members’ companies, and that such transactions face greater scrutiny “regardless of whether it’s a ‘good deal’ or not.” He added that scrutiny by regulators and credit analysts is focusing on sophisticated private equity transactions by not-for-profit hospitals (such as in this case), because of doubts that the hospitals’ boards and executives have the ability to manage these investments.
Michael W. Peregrine, Conflicts of Interest - Health, Corporate Responsibility and Governance, Health, Nonprofit Organizations
Michael Peregrine was quoted in a January 4 Modern Healthcare story about how tax-exempt hospitals and health systems are likely to face more scrutiny than ever from federal regulators, state prosecutors, the media and the general public. Governance is an especially hot issue, because, as Mr. Peregrine noted, “The IRS has clearly seen enough examples of bad boards where they know what they look like. If you’re really pushing the edge of the envelope in a way that is not supportable, you’re going to see more challenges from the IRS” and from state attorneys general over governance matters. And, Mr. Peregrine added, if malfeasance is found, regulators will push for resignations of board members as well as executives.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Nonprofit Organizations, Tax Exemption
Michael Peregrine discussed for Law360 on January 1 the increase in the Department of Justice’s pursuit of health care billing fraud, particularly with regard to holding hospital boards and executives responsible for alleged violations. “The government has said quite regularly, ‘We’re looking at the source of the problem,’ and that’s worrying board members,” Mr. Peregrine stated. He cited the application to health care the “responsible corporate officer doctrine” already used in securities and environmental law, adding, “We’re watching closely just to see where the government is taking this” so far as holding directors responsible for violations of false claims laws, the Stark Law and HIPAA.
Michael W. Peregrine, Corporate Responsibility and Governance, Health
2009
Michael Peregrine was interviewed by Corporate Board Member (Dec. 11) concerning the Justice Department's increased effort to hold individual directors accountable for bad corporate behavior. "This is not the beginning of some broad effort by the government to seek strict liability for every possible violation of law," Mr. Peregrine stated, but he added that "on certain types of civil or criminal matters the government is definitely seeking to hold individuals responsible through...strict liability principles." Mr. Peregrine advised corporate boards to "be prepared for an increase in the level of reporting up the ladder of potential violations of the law by corporate employees to come to the general counsel's attention," adding that for effective compliance programs, "boards and senior leadership can take steps to make sure that the tone at the top is clear and unambiguous, that education is strong, and that compensation is structured for compliance."
Michael W. Peregrine, Corporate Responsibility and Governance
Michael Peregrine was quoted by Modern Healthcare on December 11 concerning new materials issued by the Internal Revenue Service to help non-profit hospitals and other tax-exempt organizations better understand the IRS tax compliance review process. Mr. Peregrine said he sees the new materials “extrapolating and putting meat on the bones” of the governance section on the Form 990 that charitable organizations must file with the IRS. He added that the questions contained in the materials will give organizations “a better idea of what the IRS is expecting the right answer to be.”
Michael W. Peregrine, Corporate Responsibility and Governance, Nonprofit Organizations
Joshua Buchman was quoted by Corporate Board Member (Dec. 11) about the Justice Department's increased effort to hold individual directors and officers accountable for bad corporate behavior. "What we're talking about is strict liability offenses, primarily under the various environmental laws and under the Food, Drug and Cosmetic Act," he stated. As he described the message of prosecutors to directors, "If you were...in a position of responsibility at a company such that your position would afford you the ability to prevent or do something about...corporate violations of the law, then you could be held responsible...despite having no knowledge...and no intent that the corporation did anything wrong." Mr. Buchman advised officers to create a record showing that their compliance program efforts were "so state-of-the-art and so good that it would not be fair or appropriate" to prosecute them for such offenses.
Joshua T. Buchman, Corporate Responsibility and Governance
Michael Peregrine analyzed for Government and Politics Watch (December 11) new Internal Revenue Service materials for charities regarding their governance practices. He said the materials “demonstrate that, to the IRS, charity governance is a serious matter,” and that “the IRS is expanding on the governance issues it considers of interest.” According to Mr. Peregrine, such issues can include “inability to obtain a quorum for meetings, control centralized in one or two individuals, failure to exercise strong financial oversight, poor conflicts practices, and failure to address the recommendations of the independent auditor.” He added that the new materials can be “a useful tool” for charities to “monitor the effectiveness of existing governance practices,” especially if state attorneys general start to expand their own reviews of charities.
Michael W. Peregrine, Corporate Responsibility and Governance, Nonprofit Organizations
Eugene Goldman spoke to The National Law Journal on December 7 about cuts that some companies are making in their internal audit and compliance departments. Although he did not feel that such cuts would “necessarily” create more litigation risk, Mr. Goldman advised companies to proceed cautiously. “The [board’s] audit committee, in exercising its oversight function, should weigh in when management is considering cutting the compliance function at a time when extra monitoring should be considered,” he said.
Eugene I. Goldman, Corporate Responsibility and Governance, Trial
Michael Kendall was quoted extensively in a November 2008 Corporate Secretary article on the increased prosecution risks that corporate executives face. He noted that the trend involves "more aggression against corporations and executives, more aggression in who you go after and the theories used to go after them, more aggression in the financial penalties being sought and the length of sentences being imposed on executives." Mr. Kendall ascribed the increased prosecution both to public desire and to what he called "bureaucratic inertia toward continuing aggressiveness by prosecutors – you never hear of penalties becoming less onerous, do you? It is always more, more, more." Mr. Kendall advised board members that "scrupulous adherence to correct process is the best advice" for avoiding trouble, … "as long as the basic touchstones of good governance are applied: appropriate disclosure, experience, expertise and independence."
Michael Kendall, Corporate Responsibility and Governance, Trial
Michael Peregrine addressed compliance issues affecting corporate boards during a panel discussion at the Advanced Medical Technology Association’s annual meeting, reported by Health Care Daily Report on October 15. Mr. Peregrine noted that it is a challenge for companies to meet compliance goals in the current economic environment, adding that “there is an enormous reality gap” between how board members see their companies’ compliance performance and what the government thinks it should be. He also noted that, because individual board members may ultimately be held responsible for compliance violations, the potential liability may prompt boards to insist on better compliance programs.
Michael W. Peregrine, Corporate Responsibility and Governance
David A. Cifrino was quoted by Boardmember.com on October 7 regarding the concerns that potential government involvement in management oversight pose for members of corporate boards. “There are lots of bills pending [in Congress]” concerning not only governance, but also healthcare, financial reform, labor management, climate change, and energy, Mr. Cifrino stated. “Directors need to ask about legislation and how it will impact their company.” He added that another concern for board members should be the liquidity of their companies. “Boards should push management to explain what’s the plan now,” he declared. “Develop a strategy to deal with retooling the balance sheet, do what you can to assure liquidity. It’s all about cash generation.”
David A. Cifrino PC, Corporate, Corporate Responsibility and Governance
Eugene Goldman was quoted in Securities Regulation and Law Report (July 10) concerning the securities enforcement implications of the Obama Administration's financial regulatory overhaul plan. "It was a very good day for the SEC when the administration announced its plan," Mr. Goldman said. "If you think back four or five months, there were predictions of doom and gloom for the SEC in light of Madoff and other issues, yet this package of proposals, which will expand the commission's powers in various respects, … appears to be a vote of confidence in Chairman Schapiro and her ability to get the commission back on its feet." With the proposed 2010 SEC budget topping $1 billion for the first time, "All the signals coming out of the administration are for a proactive SEC," and he singled out recommended legislation to allow the SEC to prohibit mandatory arbitration in favor of litigation for claims against broker-dealers.
Eugene I. Goldman, Corporate Responsibility and Governance, SEC Defense, Trial
Joshua Buchman and Ankur Goel were both quoted in a June 19 Law360 story on recent changes to the False Claims Act. Mr. Buchman noted that companies no longer must deal directly with the U.S. government to have False Claims Act liability. “The bottom line is, just because you're one or two or even three levels removed from the entity doing business with the U.S. government, you're not safe,” he said. Mr. Goel thus urged companies to review their compliance programs to demonstrate “the kind of diligence the law contemplates … to show that they are aware of what they're supposed to be doing and have made a reasonable effort to put a system in place,” he said.
Joshua T. Buchman, Ankur J. Goel, Corporate Responsibility and Governance, Health, Trial
Michael Peregrine was quoted in The Wall Street Journal on March 27 concerning the impact that the furor over executive compensation at financial firms will have on executive compensation at nonprofit organizations. "The train of greater focus on nonprofit executive compensation has left the station, and charity boards better get on, or they will suffer greatly for noncompliance," he declared. Mr. Peregrine added that nonprofits should start reviewing their compensation practices in light of the current political environment, noting that, "It just cannot be business as usual."
Michael W. Peregrine, Corporate Responsibility and Governance, Nonprofit Organizations
Michael Peregrine was quoted by The Wall Street Journal on May 5 regarding more detailed disclosure on executive and trustee compensation that charities must make using new Form 990 annual reports to the Internal Revenue Service. Mr. Peregrine believes that the IRS intended the new form to involve board members more in the reporting process, stating that "The IRS feels the more the board is familiar with what's in the form, the more effective they will be in governance and oversight." He added that, for this reason, board members should be alert to and ask questions about potential conflicts of interest, excessive compensation or insider transactions revealed on the form.
Michael W. Peregrine, Conflicts of Interest - Health, Corporate Responsibility and Governance, Health
Michael Peregrine was quoted in the March 2009 issue of Trustee magazine regarding the increased scrutiny on board of director members as the result of the Sarbanes-Oxley Act and other regulations. "The job is not harder than before [and] Sarbanes-Oxley should not frighten people away," Mr. Peregrine said of potential directors. "Board work is not more risky, it just requires more self-reflection on the qualities of a good board and a better job of managing those duties. Liability is not greater than before, it's just the prism of how the board is looked at that has changed." Mr. Peregrine recommended that board members "be able to explain your fiduciary responsibilities," adding, "If you are informed and alert and do your homework, you should have no problem."
Michael W. Peregrine, Corporate Responsibility and Governance, Health
Dennis White was mentioned on February 25 in The Deal/Daily Deal regarding his appointment as the Association for Corporate Growth's (ACG) 2009-2010 Board Chairman after serving as ACG Vice Chairman. Mr. White will assume the role as Board Chairman on July 1, 2009. Mr. White is a partner in the Firm's Corporate Department based in the Boston office. His appointment was also mentioned in Investment Business Weekly, Investment Business News, Business & Finance Week, Hedgeweek, Marketing Business Weekly, Real Estate & Investment Business, Real Estate & Investment Week and Mergers & Acquisitions Business.
, Corporate, Corporate Responsibility and Governance
Dennis White was mentioned on February 19 by the Business Wire regarding his appointment as the Association for Corporate Growth's (ACG) 2009-2010 Board Chairman after serving as ACG Vice Chairman. Mr. White will assume the role as Board Chairman on July 1, 2009. ACG is the premier professional organization focused on corporate growth, corporate development, and mergers and acquisitions. "I look forward to serving as the ACG Chairman," said Mr. White. "ACG is a thriving organization offering its members truly unparalleled value. I look forward to working with the Board of Directors and Gary [LaBranche, ACG President & CEO] to continue to create opportunities for ACG members around the world to network, share best practices, source deals and grow their businesses."
, Corporate, Corporate Responsibility and Governance
2008
Michael Peregrine was quoted in the November 3 issue of Modern Healthcare in an article regarding a case in the Virgin Islands where a board chair for a public hospital was arrested and charged for an alleged role in what prosecutors describe as a "criminal enterprise" among the top three executives. Hospital trustees on the mainland may wonder what it says, if anything, about their own risk of becoming targets when things go horribly wrong under their watch. "We are entering into an environment of recrimination, and there will absolutely be spillover in the nonprofit world against boards for what I call preventable harm,'' Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Nonprofit Organizations, Tax Exemption
Michael Peregrine was quoted in the October 7 issue of The Chronicle of Philanthropy in an article regarding the growing questions about the recent actions and responsibilities of boards of deeply troubled U.S. banks and companies that will eventually also be felt by nonprofit organizations. "A spillover to charities from some of the events going on in Wall Street and Washington is probable. Boards of tax-exempt organizations are beginning to brace themselves for the spillover: this climate of responsibility and possibly recrimination," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Markets Restructuring, Tax Exemption
Michael Peregrine was mentioned in the September 18 issue of The Earth Times and PR Newswire in an article regarding The University HealthSystem Consortium (UHC) recognizing five of its full academic medical center (AMC) members with the UHC 2008 Quality Leadership Award. Mr. Peregrine will present at the 8th Annual UHC Quality and Safety Fall Forum meeting in Arizona and will discuss staying focused and delivering results from the points of view of AMC board members, clinical and operational leaders, regulatorys, and direct patient care providers.
Michael W. Peregrine, Academic Medical Centers, Corporate Responsibility and Governance, Health
Gordon A. Greenberg was mentioned in the September 9 issue of The National Law Journal in an article regarding the U.S. District Court for the Central District of California's rejection of a plea deal between federal prosecutors and Henry Samueli, co-founder and former CTO of Broadcom Corporation. Samueli plead guilty to one count of making a false statement to the SEC regarding his role in stock options backdating. Mr. Greenberg is Samueli's lawyer in the case.
Gordon A. Greenberg, Corporate Responsibility and Governance, Trial, White-Collar & Securities Defense
Michael W. Peregrine was quoted in the August 29 issue of BNA's Health Care Daily Report in an article regarding the U.S. Department of Justice's revisions to its corporate charging guidelines, which will have particular relevance for health care organizations being investigated by federal prosecutors. While the new privilege policy is significant, Mr. Peregrine said health care organizations should pay special attention to the discussion in the guidance on the role of effective corporate compliance programs in prosecutors' decisions to prosecute health care-related cases. Mr. Peregrine also said that changes announced by DOJ are "excellent reminders that the attorney-client privilege, when properly applied, remains a valuable concept."
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Health Care Litigation, Trial
Michael Peregrine was quoted in the August 20 issue of Tax Analysts in article discussing the final instructions for the redesigned Form 990. "It will require tax-exempt organizations to confront potentially sensitive issues relating to board structure, conflicts management, and disclosure of compensation, as well as business and financial relationships between board members," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in the August 20 issue of BNA's Health Care Daily in an article discussing the final instructions for the redesigned Form 990. "The final instructions to the Form 990 are indeed a significant tax planning document because they underscore, in bold type, the significance attributed by the IRS to effective governance of tax exempt organization," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in the August 19 issue of The Chronicle of Philanthropy in an article discussing the final instructions for the redesigned Form 990. "These instructions are an exclamation point to the broad IRS discourse on the importance of corporate governance that has been Steve Miller's mantra for the last 24 months," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in the March 28 issue of TaxAnalysts in an article regarding the new final regulations under section 4958 that were released by the IRS making clear that tax-exempt organizations that become involved in excess benefit transactions with disqualified persons will be in better shape if they discover the problem and take corrective action before the IRS gets involved. "The final regulations are significant from a corporate governance perspective. The regulations show that an organization's board must be aware of the circumstances under which excess benefit transactions can put exemption at risk," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in the March 6 issue of BNA's Health Law Reporter in an article regarding the IRS' releasing of an updated memorandum detailing those organizational structures and operational policies that it believes will improve governance of tax-exempt organizations. "The memorandum sheds important new light on the IRS' view of such important issues as governing board size, diligence and composition; oversight of sophisticated investment vehicles; and document retention and whistleblower policies," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
2007
David S. Rosenbloom was quoted in the May issue of Chicago Lawyer in an article regarding recent, significant trends in the practice of law in Chicago. Mr. Rosenbloom commented on major changes in the field of white-collar defense and also on the increasing diversity of Chicago firms. "I like to think that diversity is not just in response to the urgings of our clients—we recognize the need to always strive for excellence, and the more diverse group is a better group," he said.
David S. Rosenbloom, Class Action, Corporate Responsibility and Governance, Trial
Thomas Murphy was quoted in the April edition of CFO Magazine in relation to the "eProxy" ruling from the Securities and Exchange Commission that will go into effect on July 1, 2007. The new rule will allow companies to almost entirely bypass the costly process of printing and shipping proxy statements by providing information via the internet. Mr. Murphy explained that the benefit of the eProxy rules go beyond savings. They should also speed up voting and increase participation because most investors and shareholders are already comfortable using the internet.
Thomas J. Murphy, Corporate, Corporate Responsibility and Governance
Jeffrey E. Stone was quoted in the March 27 issue of The Wall Street Journal in an article regarding Firm client Gary Gerhardt, the former finance chief of Engineered Support Systems Inc., being charged with fraud and other offenses relating to options backdating. Mr. Stone aid, "Any jury who gets the chance to hear him will find him to be an honest and straightforward man."
Jeffrey E. Stone, Corporate Responsibility and Governance, Trial, White-Collar & Securities Defense
Steven S. Scholes was quoted in a February 22 article published by CFO.com regarding an NYSE trading specialist who was acquitted of fraud charges in the Southern District of New York. Mr. Scholes commented on SEC Rule 10b-5, particularly its use by prosecutors to charge individuals who deceive or mislead financial statement readers. He explained that 10b-5 is "the heart and soul" of the federal antifraud provision.
Steven S. Scholes, Corporate Responsibility and Governance, Trial
William Schuman was quoted in the February issue of CFO in an article on a recent Delaware Supreme Court decision regarding director liability. Ruling in the case Stone v. Ritter, the court stated that the complainants must prove directors "knew that they were not discharging their fiduciary obligations." Mr. Schuman said, "Proving simple negligence is not going to be enough. What [the Delaware court] is looking for is something very close to intent. It's a really tough standard to meet."
William P. Schuman PC, Corporate Responsibility and Governance, Professional Responsibility, Trial
Jeffrey E. Stone was quoted in the January 2007 issue of Corporate Board Member Magazine in an article regarding how different boards of directors have handled crisis management in response to charges of illegal conduct. Mr. Stone stated that when facing allegations, a company should create a plan to cooperate with the government to avoid broader charges. "Sometimes it may be in the corporation's best interest to walk into the government's office and say, 'Here's what we think happened, here's how this corporate officer eluded detection and was somehow able to avoid compliance, and here's how we as an entity were defrauded by this individual,'" he said.
Jeffrey E. Stone, Corporate Responsibility and Governance, Trial, White-Collar & Securities Defense
2006
Howard Steinberg was quoted by Corporate Secretary in their November issue regarding the recent decisions of various directors who have chosen to speak to the media before they speak to their board of directors regarding various issues/problems within their company.
Howard E. Steinberg, Corporate, Corporate Responsibility and Governance
Michael D. Kendall was quoted in the October 13 issue of The Boston Globe in an article regarding recent federal probes at more than 140 U.S. companies investigating the use of options backdating practices. Many firms are terminating or forcing out executives before any formal reviews have taken place or full accusations have been made. "We live in an unforgiving environment, where it’s not just substance, but also appearance and style issues can matter," he said.
Michael Kendall, Corporate Responsibility and Governance, Trial
Mark A. Collins was quoted in an October 11 article published by Compliance Week regarding options backdating investigations and the extent to which D&O insurance covers officers and directors. Mr. Collins explained that any officer or director who may be charged or investigated in the course of options backdating probes should look closely at D&O liability policy coverage. "The defense costs for these types of problems can be significant to the extent that D&O coverage is available, they should become familiar with its terms and conditions and make their claims," he said.
Mark A. Collins, Corporate Responsibility and Governance, Trial
Eugene Goldman was interviewed on September 19 by Bloomberg Radio about the Hewlett-Packard spy-on-board controversy.
Eugene I. Goldman, Corporate Responsibility and Governance, Trial
Michael Kendall was quoted in the August 26 issue of The Boston Globe on the more than 100 companies facing scrutiny over stock options accounting. Many are delaying quarterly filings while they conduct reviews. "It will be interesting to see if they [Nasdaq and the NYSE] will truly pull the trigger, as they have been threatening," commented Mr. Kendall.
Michael Kendall, Corporate Responsibility and Governance, Trial
Michael Kendall was quoted in the May 26 issue of the Christian Science Monitor regarding the effect of the guilty verdict in the Enron case will have on the "corner office." Now a CEO is more than a manager: "The concept is crisis management...You have to manage the crisis before it consumes you."
Michael Kendall, Corporate Responsibility and Governance, Trial
Michael Peregrine was quoted in the April 20 issue of BNA's Health Law Reporter regarding the U.S. Sentencing Commission's April 5 vote to remove language in the Sentencing Guidelines that puts pressure on corporations under criminal investigation to waive attorney-client privilege and work product protection as a condition of being deemed cooperative with prosecutors. "The change will affect any regulated organization that has a compliance plan, including those in the health care industry," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in the April 17 issue of Modern Healthcare regarding the Government Accountability Office’s second series of "soft-contact-audit" letters after a batch the GAO mailed earlier this year. "The GAO inquiry is distinct from the IRS probe,” Mr. Peregrine said. "Tax-exempt hospitals are facing two separate inquiries with overlapping issues this year."
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Eugene Goldman was quoted by Dow Jones, Reuters and CFO. com on April 12 regarding the SEC action and settlement with PKF, a UK auditing firm.
Eugene I. Goldman, Corporate Responsibility and Governance, Trial
Howard Steinberg was quoted in the March 24 issue of The Wall Street Journal on Sovereign Bancorp Inc. and Relational's settlement deal on a 12- member board. "While having a board seat will put them [Relational] in the information flow...in terms of really affecting outcomes, it's hard to see how one director really does it," commented Mr. Steinberg. The article also ran on MarketWatch.com and on Dow Jones.
Howard E. Steinberg, Corporate, Corporate Responsibility and Governance
Jeff Stone was quoted in the January 26 issue of the Washington Post on the impact of new laws and regulations surrounding corporate fraud.
Jeffrey E. Stone, Corporate Responsibility and Governance, Trial
David Cifrino was quoted in the January 5 issue of The Boston Globe on Sovereign Bancorp's decision to delay their annual meeting until two transactions close in order to gain a large, friendly shareholder in Santander to help vote against Relational's plans to oust all of the bank's directors.
David A. Cifrino PC, Corporate, Corporate Responsibility and Governance
2005
Mark Mihanovic was quoted in the October 4 issue of the Daily Deal in regard to how independent banks are turning to small acquisitions to protect their increasingly threatened core businesses.
Mark J. Mihanovic, Corporate, Corporate Responsibility and Governance
Eugene Goldman was quoted in the August 29 issue of Tire Business regarding "Wells notices" issued by the SEC. Mr. Goldman commented, "There are times when the Wells notice goes out and no action is brought." He said "If the company's restated, then they've already taken a hit in the marketplace. The issue is whether the SEC has uncovered additional things that would cause them to restate more." He outlined the potential enforcement action. The first tier applies to violations that don't involve fraud or substantial investor losses and carries fines of $50,000 per violation. The second tier applies to violations that include fraud, deceit or deliberate disregard of regulatory requirements but without significant shareholder losses and carries fines of $500,000 per violation. The violations can be multiplied by financial reports affected or other metrics, but fines have room for negotiation.
Eugene I. Goldman, Corporate Responsibility and Governance, Securities Litigation, Trial
Michael Peregrine was quoted in the June 3 issue of Health Law Reporter in the lead article "Ways and Means Hearing, Grassley Letter Keep Congress' Foot on Nonprofit Hospitals." Mr. Peregrine said the May 26 hearings suggest "an increased likelihood" that Congress will propose nonprofit oversight legislation that could refine the criteria for tax-exempt hospitals and dictate nonprofit governance standards. "I think is fairly clear from the confluence of the Grassley letter and the focus of the hearings that Congressional leaders believe that the nonprofit, tax-exempt hospital industry deserves special legislative attention with respect to the criteria by which 501(c)(3) status is preserved under the Internal Revenue Code," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Thomas Sauermilch was quoted on March 16 in a Dow Jones Newswire on how corporate governance is playing out in the M&A market.
Thomas Sauermilch, Corporate, Corporate Responsibility and Governance, Mergers & Acquisitions
Michael Peregrine was quoted in "With Charity for All?" published in the February issue of Corporate Counsel in regard to nonprofit organizations choosing to implement some of the Sarbanes-Oxley provisions. Mr. Peregrine commented that the efforts by nonprofit corporations to effect these reforms within their own governance structure is a "validation that people think Sarbanes-Oxley principles make good sense. But it is also a sign that [GCs] want to keep their organizations out of trouble." In addition, a sidebar story, "Both Sides Now," written by Mr. Peregrine accompanied this article, and addressed why general counsels of nonprofit organizations are becoming champions of "corporate responsibility."
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in the January 31 issue of the National Law Journal in regard to nonprofit organizations choosing to implement some of the Sarbanes-Oxley provisions. Mr. Peregrine commented that the efforts by nonprofit corporations to effect these reforms within their own governance structure is a "validation that people think Sarbanes-Oxley principles make good sense. But it is also a sign that [GCs] want to keep their organizations out of trouble."
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax, Tax Exemption
Eugene Goldman was quoted in the January 9 issue of the Los Angeles Times on whether the SEC is lessening its zeal for tough enforcement. Over the past two years, SEC has hired more than 1,100 staff members. "They're adding attorneys. They're adding accountants. They're adding investigators," commented Gene. "Their settlement demands make us litigate for clients more than ever before. I don't see how that can mean less enforcement."
Eugene I. Goldman, Corporate Responsibility and Governance, SEC Defense, Securities Litigation, Trial
Steve Scholes was quoted in the January issue of D&O Advisor regarding Sarbanes-Oxley and barring defendants in fraud cases from serving as directors or officers of public companies. The D&O bar from serving as an officer or director may last five, ten or 15 years, or a lifetime. It's a "career death sentence" Mr. Scholes commented. Even a five-year bar could stigmatize executives or board members for the rest of their working lives, he continued. There are currently no statistics on the number of directors and officers who resist a D&O bar. Although it is believed that such cases are rare, Mr. Scholes predicts they are likely to grow, "We're at the precipice of a change."
Steven S. Scholes, Corporate Responsibility and Governance, Trial
2004
Michael Peregrine was quoted in BNA's Health Law Reporter on November 18 in regard to a Delaware Chancery Court decision in which several directors were held liable for breach of their fiduciary duties in good faith and loyalty. Mr. Peregrine commented that this is the second of three expected Delaware court decisions addressing director conduct post Sarbanes-Oxley. He continued by saying the cases are noteworthy because together they have the potential to impose a higher standard of care for directors with specialized knowledge.
Michael W. Peregrine, Corporate Responsibility and Governance, Health
Eugene Goldman was quoted in the September 28 issue of The Wall Street Journal in regard to Fannie Mae's Chief Financial Officer J. Timothy Howard's decision to sell millions of dollars of stock during the period that is now under accounting scrutiny by regulators. Mr. Goldman said the key question [under the relevant SEC rule] is whether Mr. Howard had material non-public information when he entered into his stock-sales plan. "In other situations, the SEC has charged people with insider trading [if the insider was] disposing of company stock while aware of financial irregularities," commented Mr. Goldman. "What you don't know is what is it that he knew before he entered into the plan."
Eugene I. Goldman, Corporate Responsibility and Governance, Trial
Mark Pearlstein was quoted by the Wall Street Journal on September 20 regarding the deferred prosecution agreement included within the resolution Computer Associates discussed with the U.S. Department of Justice. Mr. Pearlstein commented on the agreement saying Computer Associates would have a "sword of Damocles hanging over its head. If the corporation were to screw up, the prosecution could be revived."
Mark W. Pearlstein, Corporate Responsibility and Governance, Trial
Eugene Goldman was quoted in the August 14 issue of National Post in an article reporting on some recent developments that illustrate that American companies are realizing that routine cursory checks on overseas internal controls are not always enough. Mr. Goldman, who spent much of last year advising clients on how to clean up their overseas offices, commented, "Some of the advice is on simple revenue recognition. Asking local managers to match up contracts with deliveries."
Eugene I. Goldman, Corporate Responsibility and Governance
Michael Peregrine was quoted in the July 8 issue of the Chicago Sun-Times in regard to Eliot Spitzer's lawsuit against Richard Grasso, former chairman of the NYSE. Spitzer's lawsuit did not delve into the NYSE's contributions, which suggests there were no improprieties commented Mr. Peregrine. "One would think the Attorney General would have run an allegation of improper uses of donations if there was indeed credible evidence."
Michael W. Peregrine, Corporate Responsibility and Governance, Tax Exemption
Michael Peregrine was quoted in Bloomberg news story on July 7 in regard to Eliot Spitzer's lawsuit against Richard Grasso, former chairman of the NYSE, citing New York's not-for-profit corporation law that officers' pay must be "reasonable." Spitzer's lawsuit did not delve into the NYSE's contributions. That suggests there were no improprieties commented Mr. Peregrine. "One would think the Attorney General would have run an allegation of improper uses of donations if there was indeed credible evidence."
Michael W. Peregrine, Corporate Responsibility and Governance, Tax Exemption
Michael Peregrine was quoted in the June 21 issue of Business Week in response to Eliot Spitzer's lawsuit against Richard Grasso on the IRS's plans to examine executive compensation among nonprofits. Mr. Peregrine commented that prior to the Sarbanes-Oxley Act, nonprofit organizations (which do not have investors) were not subject to as much oversight as to their business and corporate affairs as were business corporations.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in the June 14 issue of Business Week on new obligations for corporate directors to oversee corporate compliance plans, arising out of the new proposed amendments to the federal sentencing guidelines.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Helen Friedli was quoted in the June 11 issue of Business Week in an article reporting on Steve Cutler, enforcement chief of the U.S. Securities and Exchange Commission (SEC). The article discussed Cutler playing hardball with wrongdoers in Corporate America and on Wall Street. In particular, Ms. Friedli commented on the result of Sarbanes-Oxley that indirectly boosted the SEC's leverage over defendants by encouraging the U.S. Sentencing Commission to overhaul guidelines for prison terms for criminal securities fraud. For example, Jamie Olis, a former Dynegy Inc. executive, was sentenced to more than 24 years in prison for his role in a scheme to conceal a $300 million loan from investors. "The Olis case made people look carefully at the potential benefits of early cooperation and resolution [with the SEC]," she said.
Helen R. Friedli PC, Corporate, Corporate Responsibility and Governance
Michael Peregrine was quoted in the June 2004 issue of the ABA Journal, in an article regarding the fact that nonprofit organizations are now being more closely scrutinized by the government. According to Michael, there is a critical difference between nonprofits and for-profit companies. "The responsibilities of a nonprofit board are essentially the same as those of a for-profit company," Mr. Peregring said. "They must have a duty of loyalty, a duty of care, fiscal responsibility. But there's one additional duty for the nonprofit board -- the duty of obedience to the stated mission."
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine commented on New York Attorney General Eliot Spitzer's lawsuit seeking more than $100 million from the former NYSE Chairman Richard Grasso in the June 1 issue of the Chicago Tribune. More cases like this are likely and it is alerting nonprofits to the areas regulators will be examining in compensation Mr. Peregrine commented. "I think it's a very powerful argument when an attorney general goes after a charity and says, 'You're paying your CEO too much.' It's really a helpful development for nonprofits, giving them added incentive to examine their own procedures," Mr. Peregrine said.
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in a May 26 Reuters story, which also appeared on Forbes.com, regarding Eliot Spitzer's decision to sue former NYSE Chairman and Chief Executive Richard Grasso. "There are important nuances in Spitzer's argument against Grasso," commented Mr. Peregrine. "Part of Spitzer's argument is that the board was misled. It's very difficult to criticize a board for failure to exercise appropriate judgment if part of your argument is that the process was flawed and the board was not allowed to see certain information."
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Michael Peregrine was quoted in the May 25 issue of USA Today in an article reporting on New York Attorney General Eliot Spitzer's groundbreaking lawsuit against the former head of the New York Stock Exchange, Richard Grasso. Spitzer is suing Grasso to return "in excess of $100 million" arguing Grasso's pay was unreasonable under New York state laws governing not-for-profit institutions such as the NYSE. "Spitzer's suit shines a bright light on the process by which nonprofit organizations establish compensation," commented Mr. Peregrine. "You have billion-dollar nonprofits across the country, and this is an enormously hot issue right now."
Michael W. Peregrine, Corporate Responsibility and Governance, Health, Tax Exemption
Gordon Greenberg was quoted in a Reuters wire story regarding the Martha Stewart case. The story which appeared in The Toronto Star, the Calgary Sun and The Ottawa Sun on April 2 reported on Martha Stewart's retrial. "It's an uphill battle for the defense," commented Mr. Greenberg.
Gordon A. Greenberg, Corporate Responsibility and Governance, Trial
Eugene Goldman was quoted by Reuters on March 30 in regard to the possibility that the New York Stock Exchange will be sanctioned by the U.S. Securities and Exchange Commission for failing to properly supervise its floor traders. The article reported that some commission members are considering fining the NYSE or altogether removing the exchange's ability to regulate itself, even though the NYSE has implemented structural changes under John Reed. "All of the changes would certainly have impact on deterring the Commission from launching a nuclear bomb on the exchange in the regulatory context. But if they feel there was a serious breakdown, the SEC will probably proceed with disciplinary measures," commented Mr. Goldman.
Eugene I. Goldman, Corporate Responsibility and Governance, SEC Defense, Securities, Securities Litigation, Trial
Eugene Goldman was quoted in the Washington Post on February 28 in response to the federal judge throwing out the most serious criminal charge against Martha Stewart. Mr. Goldman commented that as a result of this decision, "Corporate executives who want to deny government charges can breath easier because the judge has confirmed that the government has to provide specific evidence that 'proclamations of innocence were made with intent to deceive shareholders.'"
Eugene I. Goldman, Corporate Responsibility and Governance
Eugene Goldman was quoted in the February 20 issue of Christian Science Monitor regarding the whether Martha Stewart will testify. If she does take the stand two issues that she will have to address will be the phone message from Peter Bacanovic, her stockbroker, that she allegedly changed, and Stewart's version of the story in regards to Sam Waskal selling his imClone stock. "I think the jury is very curious about why she changed the message," commented Mr. Goldman. "Why would she sit down at her secretary's chair and use the mouse on her computer and erase a message and type something else. Why did you panic?" Mr. Goldman also said he would want to ask Stewart if and when she heard that Waskal was selling.
Eugene I. Goldman, Corporate Responsibility and Governance, Trial
Eugene Goldman was quoted "Why CEOs Should Hope Martha Walks," published in Fortune magazine on February 9. The article points out that according to legal experts, the prosecution's case stretches the scope of securities laws in ways that threaten to muzzle all top executives. For example, Mr. Goldman said, "If the government wins the ability to proclaim your innocence gets watered down."
Eugene I. Goldman, Corporate Responsibility and Governance, Trial
Eugene Goldman was quoted in the February 6 issue of the Baltimore Sun in an article reporting on the Martha Stewart trial. The article reports that the securities fraud charge against Stewart for falsely proclaiming her innocence to shareholders in her company could impact how other executives publicly react to accusations of wrongdoing. "Whether or not [prosecutors] win against Stewart, the charges will cause chief executive officers to huddle very closely with their counsel, on what, if anything, they can say publicly about charges that have been disseminated by the prosecutors," commented Mr. Goldman.
Eugene I. Goldman, Corporate Responsibility and Governance, Trial
Thomas Murphy was quoted in the Financial Times on January 28 regarding Adecco's silence on its accounting problems. So far the Swiss company's comments on the difficulties that forced it to postpone its 2003 results have been very limited and management has mentioned Sarbanes-Oxley as the prime reason. However, the article pointed out that Sarbanes-Oxley does not prohibit giving information to investors and notes that Adecco is probably being extremely cautious. "The stakes are higher. The landscape is more complicated. They probably want to make sure they get it right," commented Mr. Murphy.
Thomas J. Murphy, Corporate, Corporate Responsibility and Governance, Securities
2003
Jeffrey Stone was quoted in an Associated Press story on December 19 which addressed whether mutual fund scandals that have been brought in front of a federal grand jury in Boston brings to light the difficult question of just how criminal prosecutors could or should be involved in a matter that has traditionally been the purview of the civil justice system. Several experts said that egregious market-timing abuses could rise to the necessary threshold for criminal charges of deliberate, criminal intent. Mr. Stone responded, “Market timing alone I think is a very difficult and unattractive criminal case. They’re going to look for the most egregious examples they can find. A pure market timing case does not rise to that level.” This story appeared in The Seattle Times, The Detroit News, Pasadena Star News and The Atlanta Journal-Constitution.
Jeffrey E. Stone, Corporate Responsibility and Governance, White-Collar & Securities Defense
David Fuller was quoted in an Associated Press wire story on this subject commenting that although he first became aware of this audit effort in April he has seen it expand from its initial focus on fringe benefits and deferred compensation arrangements to several other types of compensation arrangements, “This beast is growing.” He continued by saying that an internal corporate compliance audit can protect companies from some aspects of an IRS audit but that will not protect executives whose personal returns are also being examined as part of this audit initiative. The wire story was printed in a number of newspapers around the country, including the Chicago Tribune, the Miami Herald and the San Francisco Chronicle.
Corporate Responsibility and Governance, Executive Compensation, Tax
David Fuller was quoted in Business Week on December 12 in an article reporting on the IRS's audit initiative on compensation paid to corporate officers, executives and board members. The IRS recently said it intends to make executive pay part of every future corporate audit. “They are clearly sending a signal that they are no longer a kinder, gentler IRS. I don't see this blowing over,” Mr. Fuller commented.
Corporate Responsibility and Governance, Executive Compensation, Tax
Eugene Goldman was quoted in two recently released Reuters wire stories regarding John Reed’s (NYSE's interim chief) proposed array of reforms. On November 12, Mr. Goldman commented that SEC Chairman William Donaldsan’s support of the new reform plan would probably blunt the impetus toward a full-fledged regulatory split at the NYSE. "I don’t think (the SEC will) do anything to disrupt the Reed reforms. As they continue to look at the issue, they are going to be looking at the NASD regulation model." On November 13, Mr. Goldman was quoted in a story regarding John Reed’s plan to install board members of the NYSE who are independent from the financial service industry. Mr. Goldman commented that the SEC will "keep a watchful eye over the issue of severing the regulatory business of the exchange. The creation of an independent board will be viewed by the SEC as a first step, but probably not the last step."
Eugene I. Goldman, Corporate Responsibility and Governance, SEC Defense, Securities
Eugene Goldman was quoted in the November 8 issue of Financial Times regarding the NYSE’s continued governance reforms. Mr. Goldman commented that cases where regulation has been separated from an exchange's trading business have been well received by the SEC. The best example is the split between the NASD and the Nasdaq stock market.
Eugene I. Goldman, Corporate Responsibility and Governance, SEC Defense, Securities
Eugene Goldman was quoted in the November/December 2003 issue of Corporate Board Member magazine in the article, "The SEC vs. Eliot Spitzer: Whose Turf Is This?" Mr. Goldman commented that it is possible that a compromise could be reached regarding proposed legislation that as part of a broader securities act would reduce the states’ ability to supersede the SEC's brokerage regulations with their own, so there are not 50 different sets of rules. "I think there needs to be a mechanism that would require the state to consult with the SEC before it attempts to impose these kinds of business conditions. If the SEC has no problem, fine. If it does, the state would have to defer to the SEC."
Eugene I. Goldman, Corporate Responsibility and Governance, SEC Defense, Securities
Tom Murphy was quoted the August issue of the Chicago Lawyer regarding Sarbanes-Oxley. "Reporting up within the issuer is something the profession could and should be able to live with, he commented. "It’s hard to quarrel with the objectives. Given the debacles that occurred, there was a need to respond."
Thomas J. Murphy, Corporate Responsibility and Governance
Thomas Murphy was quoted in the July issue of Corporate Legal Times in regard to the loans of companies and the high stake risks when they are not paid off. "An atrocious amount of work has been foisted on the SEC, so it's not fair of reasonable to expect them to do anything extra that's not required by the law. That's a problem because 402 is so confusing, and it's so hard to know what it means," commented Mr. Murphy.
Thomas J. Murphy, Corporate, Corporate Responsibility and Governance
Eugene Goldman was quoted by CBS MarketWatch on June 7 regarding the SEC's action against Martha Stewart. Mr. Goldman commented that prosecutors must prove that Stewart knew that receiving information from a stockbroker about another client breached Merrill Lynch's stockbroker duty. Mr. Goldman also commented on the SEC's insider trading charges in the Chicago Tribune on June 10. "I know of no case where knowledge of an insider's trading being communicated by your stockbroker results in liability for insider trading," he commented.
Eugene I. Goldman, Corporate Responsibility and Governance
Eugene Goldman appeared on CNBC's News with Brian Williams on June 3 and Bloomberg radio on June 4 in regard to Martha Stewart's indictment by a grand jury. He was also quoted on Forbes.com on June 5. "While much of the evidence outlined in the 41-page indictment may resurface in the civil case, a judge could still rule that some of it is inadmissible," Mr. Goldman commented.
Eugene I. Goldman, Corporate Responsibility and Governance, Securities
Andrew Liazos was quoted in the May 23 issue of the Boston Business Journal regarding the effect of Sarbanes-Oxley for split-dollar insurance. "Sarbanes Oxley doesn't have that many direct impacts on benefits - the blackout and the loan impact - but the broader impact is to what degree companies will look at governance procedures for their benefits plans," commented Mr. Liazos.
Andrew C. Liazos, Corporate Responsibility and Governance, Executive Compensation
Andrew Liazos was quoted in the May issue of Board Alert in regard to the increased salaries of committee chairs, non-executive chairman and presiding directors, who are doing more work than ever before. The bigger paychecks, Mr. Liazos commented, marks "a shift in thinking. Directors are saying, 'If you're putting all this additional responsibility on me, you'd better pay me well and indemnify me.'"
Andrew C. Liazos, Corporate Responsibility and Governance, Executive Compensation
Eugene Goldman made his eleventh appearance on CNBC's Squawk Box program on April 11. Mr. Goldman was interviewed on the SEC's plan to in examine whether unregistered hedge funds should be regulated, and SEC fraud actions against hedge funds.
Eugene I. Goldman, Corporate Responsibility and Governance
Thomas Sauermilch was quoted in the February 28 issue of The Daily Deal regarding the pay out to Mannesmann executives after the Vodafone takeover. Mr. Sauermilch commented on the dispiriting pair of developments - Mannesmann and the criminal breach-of-trust charges against the CEO of Deutsche Bank AG - for the German financial community.
Thomas Sauermilch, Corporate Responsibility and Governance, Germany
Gordon Greenberg was quoted in the February 8 issue of The Washington Post regarding the increased accountability set forth by the SEC. "Right now there's a hue and cry for all professionals, accountants and lawyers to be subject to penalties. It's like what happened in the [1980s] savings and loan crisis," commented Mr. Greenberg.
Gordon A. Greenberg, Corporate Responsibility and Governance
Thomas Murphy was quoted in the February 1 issue of International Financial Law Review regarding the Sarbanes Oxley Act and a series of reforms set forth by the SEC. "It remains to be seen whether all the additional reconciliations will improve or clutter disclosure. Whether the additional information will overwhelm or confuse the average investor or enlighten and comfort them is anyone's guess at this point," commented Mr. Murphy.
Thomas J. Murphy, Corporate Responsibility and Governance
Thomas Murphy was quoted in the January 24 issue of Financial Times regarding the SEC's decision to change some of the corporate governance rules, including their original definition of "financial expert," which is required on all companies' audit committees.
Thomas J. Murphy, Corporate Responsibility and Governance
Eugene Goldman appeared on CNBC's Squawk Box program on January 23. Mr. Goldman was interviewed on the SEC's rule to compel mutual funds to disclose their proxy voting on corporate governance and other issues. He was also interviewed on Bloomberg Television on the same subject on January 22.
Eugene I. Goldman, Corporate Responsibility and Governance
2002
Thomas Murphy was quoted in the December 23 issue of The Deal regarding the chance that more companies are going to choose to go public in 2003 rather than merging. "It's unusual that member-owned organizations would conclude that going public is a great idea." Mr. Murphy continued by saying that going public is difficult even more so now with the Sarbanes-Oxley Act, "Being public is no longer the end-all, be-all for a company."
Thomas J. Murphy, Corporate, Corporate Responsibility and Governance
Michael Kendall was quoted in the December 13 issue of The Boston Business Journal in an article addressing the type of work white-collar attorneys are focusing on. Mr. Kendall commented that white-collar criminal defense attorneys agree that the theme these days is prevention and that the Sarbanes-Oxley Act is keeping the practice busy.
Michael Kendall, Corporate Responsibility and Governance, Trial, White-Collar & Securities Defense
Eugene Goldman appeared on the CNBC's Squawk Box on December 6. Mr. Goldman was interviewed by economist Larry Kudlow on the SEC's proposed rules that would require mutual funds to disclose their proxy voting record.
Eugene I. Goldman, Corporate Responsibility and Governance, Securities
Peter Faber was quoted in the December 4 issue of The Wall Street Journal in an article addressing the SEC's proposed rules that could ban accounting firms from selling tax strategies to their auditing clients. These proposed rules are part of amendments to auditor-independence standards to reduce conflicts. Mr. Faber commented that the rules, if finalized, could prohibit accounting firms from doing tax planning for audit clients.
Peter L. Faber, Corporate Responsibility and Governance, Tax
Eugene Goldman appeared on CNBC's Squawk Box on December 3. Mr. Goldman was interviewed about the greater likelihood that clients will litigate against harsher Sarbanes-Oxley penalties sought by the SEC's Enforcement Division, and the need for the Bush Administration to take the opportunity to give a major boost to the SEC's 2003 budget and promptly fill the leadership void following the resignation of Chairman Harvey Pitt.
Eugene I. Goldman, Corporate Responsibility and Governance
Andrew Liazos was quoted in the November 11 issue of Fortune magazine in regard to "sweetheart loans" covered under the Sarbanes-Oxley Act. Many public companies have ceased making premium payments pursuant to "split dollar" life insurance arrangements, which may be viewed as prohibited loans under the Act. Mr. Liazos pointed out that careful planning is required to safeguard policy values if a public company discontinues split-dollar premium payments.
Andrew C. Liazos, Corporate Responsibility and Governance, Split-Dollar Life Insurance
Gordon Greenberg co-chaired and participated in the ABA/ABA Money Laundering Enforcement Seminar which took place on October 27-29 in Arlington, Virginia, and had 550 bankers and attorneys in attendance. Mr. Greenberg was the moderator on "The Gatekeeper Issue," panel which aired on C-SPAN on October 28. The panel included leading U.S. government officials. The key issue debated was the responsibility of attorneys to report suspicious transactions by clients.
Gordon A. Greenberg, Corporate Responsibility and Governance, White-Collar & Securities Defense
Eugene Goldman appeared on CNBC's Squawk Box on October 24. Mr. Goldman was interviewed about the SEC's efforts to insulate the preparation of research reports issued by investment banks from the investment banks' underwriting of public offerings.
Eugene I. Goldman, Corporate Responsibility and Governance
Mark Pearlstein was quoted in the October 23 issue of The Atlanta Journal and Constitution in regard to the SEC's investigation of Martha Stewart. "The fact that the SEC is pushing forward is not a positive sign and indicates that the SEC believes the evidence is there to bring about a case," commented Mr. Pearlstein.
Mark W. Pearlstein, Corporate Responsibility and Governance
Mark Pearlstein was quoted in the October 22 issue of The Boston Globe in regard to the Martha Stewart investigation. Mr. Pearlstein commented on ImClone chief executive Sam Waksal's admittance of telling his daughter to sell off her ImClone stock before its plunge.
Mark W. Pearlstein, Corporate Responsibility and Governance
Eugene Goldman was quoted in the October 7 issue of Investor Relations Business regarding increased bureaucracy and regulations to avoid accounting loopholes. Mr. Goldman argued that the reason accounting scandals became such an issue was because the SEC was under-funded and understaffed, not because its lawyers were taking it easy.
Eugene I. Goldman, Corporate Responsibility and Governance
Mark Pearlstein was quoted in the October 3 issue of The Boston Globe regarding the alleged insider trading by Martha Stewart. As a result of Douglas Faneuil's confession, Mr. Pearlstein commented that his agreement with prosecutors is likely going to put more heat on Stewart. Mr. Faneuil has "every incentive at this point to truthfully cooperate with prosecutors" related to ImClone trade, commented Mr. Pearlstein.
Mark W. Pearlstein, Corporate Responsibility and Governance
Eugene Goldman appeared on CNBC's Squawk Box on September 19. He was interviewed about prosecutors' efforts to freeze assets in a manner making it difficult for a defendant to post bond pending trial. Mr. Goldman was also interviewed on congressional, SEC and DOJ interest in investment banks handing out valuable initial public offering shares to officers and directors of companies that selected the investment banks to conduct their public offerings on August 29.
Eugene I. Goldman, Corporate Responsibility and Governance
Eugene Goldman was quoted in the September 9 issue of Securities Week regarding the Sarbanes-Oxley Act. Mr. Goldman commented that the new law prohibits executives from "misleading" auditors, but that the term "misleading" is not defined and therefore leaves the door open for questions.
Eugene I. Goldman, Corporate Responsibility and Governance
Eugene Goldman was quoted in the September 5 issue of National Journal's Technology Daily regarding the new corporate responsibility laws. Mr. Goldman said the law, which creates an accounting oversight board and requires company executives to certify the veracity of their firms' financial statements, may have problems because of the ground it is trying to cover, yet the regulations do add a needed transparency.
Eugene I. Goldman, Corporate Responsibility and Governance
Richard Mitchell was quoted in the September issue of Corporate Finance on an article addressing how non-U.S. corporates will be lobbying the SEC, the NYSE and politicians in an effort to be excluded from some of the more onerous provisions of the Sarbanes-Oxley Act.
Richard Mitchell, Corporate Responsibility and Governance, London
David Cifrino was quoted in the September issue of CFO Magazine in an article which outlined a few of the many worries of CFOs and CEOs in the post-Enron environment and the recent enactment of the Sarbanes-Oxley Act. Mr. Cifrino commented on a "guilt by association" worry in regard to a provision regarding an ethics code for finance offers included in the Sarbanes-Oxley Act, which the article stated some executives may take personally. Don't, the article stated; the ethics code provision is simply "reflective of the publicity given to misconduct by people in finance and accounting -- that's where the scandals have been," Mr. Cifrino commented.
David A. Cifrino PC, Corporate Responsibility and Governance
Eugene Goldman was quoted in the September 1 issue of Mergers & Acquisitions Journal regarding new corporate governance legislation and its effect on corporate deals. "The increased transparency will increase people's comfort levels because the improved oversight of financial reporting will make the final product more accurate," commented Mr. Goldman.
Eugene I. Goldman, Corporate Responsibility and Governance
Eugene Goldman appeared on CNBC's Squawk Box on August 29. Mr. Goldman was interviewed on Congressional, Securities & Exchange Commission and Department of Justice's interest in investment banks handing out valuable initial public offering shares to officers and directors of companies that selected the investment banks to conduct their public offerings.
Eugene I. Goldman, Corporate Responsibility and Governance
Rick Mitchell was quoted in the August 20 issue of the Daily Deal in an article addressing whether the SEC will exempt foreign companies from any of the new "corporate governance" rules under the Sarbanes-Oxley Act. The article highlights Porsche AG, which recently put its plans for a secondary listing in the U.S. on hold, at least in part as a result of the new rules. Mr. Mitchell stated his view that "It may be that companies like Porsche decide not to list, and that is a bad thing. The SEC has worked hard to attract non-U.S. companies to the U.S. market, and that’s good for the companies and good for U.S. investors as well."
Richard Mitchell, Corporate Responsibility and Governance, London
Thomas Murphy was quoted in a August 16 Dow Jones News Wire regarding the certification standards executives must follow. Mr. Murphy commented on the lack of penalties outlined in the Sarbanes-Oxley Act for those executives who do not file.
Thomas J. Murphy, Corporate Responsibility and Governance
Rick Mitchell was quoted in the August 15 issue of the Daily Deal in an article addressing the August 14 deadline for top executives to personally swear to the accuracy of their financial results. Mr. Mitchell commented on Europe's response to these certifications, "Europeans are hot and bothered by the actions of Congress and the SEC." He also mentioned that foreign businesses see this as "Washington legislating for Europe," and expressed his thoughts that the decision to include foreign companies in this bill may not have been wise as some of the provisions conflict with the way foreign companies conduct their business.
Richard Mitchell, Corporate Responsibility and Governance, London
Jeffrey Stone was quoted in the August 14 issue of The Christian Science Monitor in regard to the newly mandated requirement of Congress and the SEC, which makes it the responsibility of chief executive to swear to its company's financials. "Nothing focuses the attention like the prospect of a personal prosecution," commented Mr. Stone.
Jeffrey E. Stone, Corporate Responsibility and Governance
Eugene Goldman was quoted in a Yahoo News Brief on August 8 in regard to the chief executives' certifications as mandated by Congress and the Securities & Exchange Commission. Mr. Goldman commented, "It is an effort to put personal responsibility on those in charge of the information that's being distributed. The certification may form an independent basis for enforcement action."
Eugene I. Goldman, Corporate Responsibility and Governance
Steven Scholes was quoted on August 8 in BestWire regarding corporate officers signing off on the veracity of their company's financials. Mr. Scholes explained the penalties, although not criminal, of this Securities & Exchange Comission requirement. "Any time an officer makes a statement to the public that is later deemed misleading, the signer is exposed to the federal securities law." He also commented that the law increases the penalties for white-collar crimes, including a $5 million fine and up to 20 years in prison.
Steven S. Scholes, Corporate Responsibility and Governance, White-Collar & Securities Defense
Eugene Goldman made his fourth appearance on the CNBC show Squawk Box on August 5. Mr. Goldman was interviewed by noted economist Lawrence Kudlow on recent securities law prosecutions and CEO/CFO certifications of financial statements.
Eugene I. Goldman, Corporate Responsibility and Governance, Securities
McDermott Will & Emery's hosted teleconference on the expanding accountability and liability of nonprofit corporations in the wake of business failures was recapped in the July/August issue of Trustee magazine.
Corporate Responsibility and Governance
Eugene Goldman was quoted in the July 29 issue of The Wall Street Journal regarding the corporate oversight bill recently passed by Congress, which increases the role of the SEC. Mr. Goldman commented on the boost of the SEC resources, which, "will result in more cases being brought [and] that will contribute to the ability of class-action lawyers to piggyback on the SEC's efforts." He concludes by saying that as a result there could be heightened exposure for accounting firms.
Eugene I. Goldman, Corporate Responsibility and Governance, SEC Defense, Securities
Jeffrey Stone was quoted in July 28 issue of the Boston Globe regarding the new order set forth by the SEC which required chief executives and chief financial officers to sign sworn statements by mid-August declaring that their most recent financial reports are accurate and complete. Mr. Stone commented on the increased use of outside counsel in regard to investigating financial irregularities, and the increased scrutiny on decision making once a problem is discovered. "On the one hand, you don't want to put bad news out there, when the market is overreacting, and you don't want to err on the side of over disclosure. On the other hand, now is the time to come clean. You can immunize or inoculate, yourself to anything that might come out later," Mr. Stone said.
Jeffrey E. Stone, Corporate Responsibility and Governance, White-Collar & Securities Defense
Eugene Goldman appeared on the CNBC show Squawk Box on July 15. Mr. Goldman was interviewed on SEC priorities and securities litigation.
Eugene I. Goldman, Corporate Responsibility and Governance, Securities Litigation, Trial
Eugene Goldman appeared on the CNBC show Squawk Box on June 18. Mr. Goldman was interviewed on insider trading issues, including what the SEC looks for in an investigation and the types of defenses that can be raised.
Eugene I. Goldman, Corporate Responsibility and Governance
Donald Hilliker noted as the former chairman of the American Bar Association’s ethics committee, was quoted in the February 23 issue of the Chicago Tribune and the February 22 issue of the Los Angeles Times. Mr. Hilliker commented that in the wake of the Enron situation the ABA may change its ethics guidelines because "Law firms are often at the center of many of these transactions."
