A Court Ruling Opens A New Front That Can Potentially Be Used To Challenge Dodd-Frank
Industry groups have been evaluating legal challenges to the new corporate whistle-blower program of the Securities and Exchange Commission and a legal provision regarding oil and natural gas extraction from foreign countries.
This was revealed by people who have been briefed on the talks. The plan of the Commodity Futures Trading Commission to rein in speculative trading has also come under fire.
The catalyst is a decision rendered by a federal appeals court in July, which nullified an S.E.C. rule that would have been made it easier for shareholders of a company to nominate their directors. Referred to as the proxy access rule, it was found to have stemmed from the Dodd-Frank Act, the comprehensive regulatory overhaul that was implemented following one of the worst financial crisis to hit America.
During the past few weeks, Wall Street trade groups and lawyers converged in Washington to brood over the next big case. One of the meetings was sponsored by the United States Chamber of Commerce and has been called by lawyers as “Dodd-Frank Excesses.” This was revealed by two people who were informed of the meeting.
Up to now, Wall Street depended much on a horde of lobbyists to reshape and soften 300 new rules coming from the Commodity Futures Trading Commission and the S.E.C., among other regulatory agencies. However, although lobbying might produce the occasional loophole, court rulings can really stop the new rules altogether.
As this developed, Eugene Scalia, the attorney who won the proxy case for the Chamber of Commerce, said, “I would hope the agencies are taking to heart the potential consequences for Dodd-Frank rules.”