Adam Pritchard is the Frances and George Skestos Professor of Law at the University of Michigan Law School. This post is based on a working paper by Prof. Pritchard, Professor Joseph Grundfest, the William A. Franke Professor of Law and Business, Emeritus, Stanford Law School; Professor Yuliya Guseva, the Kevin Wood and Mary Jo Peed Professor of Law, Florida State University College of Law; and Professor Irena Hutton, the Gene Taylor/Bank of America Professor of Finance, Florida State University College of Business.
The Administrative Procedure Act (APA) provides the procedural framework for both rulemaking and its subsequent judicial review. Stakeholders participate throughout this process as commenters, meeting participants, and, sometimes, litigants. Judicial review represents not a separate regulatory stage, but the culmination of the rulemaking process. Most empirical scholarship, however, does not connect the two stages.
Our empirical paper examines the relationship between the comment process, rulemaking, and litigation in the context of Securities and Exchange Commission (SEC) rulemaking. SEC rules have drawn attention in recent years as rulemaking accelerated significantly during the tenure of Chair Gary Gensler, with a parallel increase in litigation activity challenging those rules. Our paper not only makes empirical contributions but also offers an important policy insight. Namely, public comments and meetings with the SEC are not background noise filled with boilerplate objections, form-letter campaigns, lobbying activity, and industry groups posturing. The process produces reliable signals about which rules are more likely to attract future litigation from stakeholders. If the SEC reads the comments and meeting memoranda carefully enough, it can detect those signals before lawsuits are filed. In contrast, proceeding with a rule past this early-warning system may suggest a deliberate choice to face a higher litigation risk.
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SEC’s Proposal to Simplify Filer Status for Public Companies: Comment from CHRO Association
More from: Ani Huang, CHRO Association
Ani Huang is the President, Policy and Practice, for the CHRO Association. This post is based on a comment letter by CHRO Association submitted to the U.S. Securities and Exchange Commission regarding the proposal to simplify filer status for public companies.
The CHRO Association submits these comments in response to the rule proposal issued by the Securities and Exchange Commission (SEC) regarding the simplification of filer status for public companies (“Proposal”). We appreciate the SEC’s ongoing efforts to reform public company reporting requirements and are pleased to provide our views on the Proposal.
The CHRO Association is a public policy advocacy organization that represents the most senior human resource officers (CHROs) in nearly 400 of the largest corporations across industries doing business in the United States and globally. Collectively, these companies employ more than 10 million employees in the United States, nearly nine percent of the private sector workforce, and 20 million employees worldwide. Approximately two-thirds of the Association’s members are federal contractors, including those operating within the defense industry.
Under current SEC rules, based upon metrics such as public float and annual revenue, issuers may qualify as a 1) Large accelerated filer (LAF); 2) Accelerated filer (AF); 3) Non-accelerated filer (NAF); 4) Smaller reporting company (SRC); or 5) Emerging growth company (EGC). Each status confers a specific regulatory framework upon issuers. Many companies qualify as more than one type of filer; for example, the Proposal notes that in 2024 NAFs that were also SRCs or EGCs (or both) accounted for 51.9% of all issuers.[1]
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