Alert September 13, 2011

Client Alert: SEC Concedes Battle over Mandatory Proxy Access but Amendment Allowing Shareholder Proposals for Proxy Access to Become Effective

Goodwin Procter’s M&A/Corporate Governance Practice issued a client alert discussing the SEC’s announcement that it would not challenge the decision by the U.S. Court of Appeals for the D.C. Circuit vacating SEC rules that would have established a mandatory procedure applicable to all public companies (including registered investment companies) under which eligible shareholders could nominate director candidates to be included in a company’s proxy statement (the “proxy access rules”).  In its announcement, the SEC also noted that related amendments to Rule 14a‑8, which were adopted at the same time as the proxy access rules but had been stayed pending the Court’s decision, would go effective upon the date of the stay’s expiration, expected to be September 13, 2011.  (The amendments to Rule 14a-8 (also known as the shareholder proposal rule) were discussed along with the proxy access rules in the September 7, 2010 Financial Services Alert.)