On January 30, 2024, the Delaware Court of Chancery struck down Tesla CEO Elon Musk’s $55 billion performance-based stock option package, ruling that Tesla’s directors did not satisfy the stringent “entire fairness” standard in approving his compensation. This case comes
Cleary Securities, Disclosure, and Governance Watch
Latest from Cleary Securities, Disclosure, and Governance Watch - Page 9
Selected Issues for Boards of Directors in 2024
As 2024 gets off to a busy start, companies, boards and management teams are facing a host of new and developing business issues and a large array of regulatory developments, from new and growing risks and opportunities from the adoption…
Rock Center for Corporate Governance at Stanford University
Cleary Gottlieb partner Francesca Odell was interviewed by the Rock Center for Corporate Governance at Stanford University about the board of directors’ role in corporate DEI initiatives in light of recent Supreme Court decisions on affirmative action.
To view the…
ClawFAQs: Common Clawback Questions
Over thirteen years after the Dodd–Frank Wall Street Reform and Consumer Protection Act added Section 10D to the Securities Exchange Act of 1934 (the “Exchange Act”), the Securities and Exchange Commission’s (“SEC”) clawback rules[1] became effective on October 2,…
New Delaware Ruling Highlights Unintended Consequences of Excluding Officers from Fiduciary Duty Waivers
Delaware law provides parties with significant flexibility to restrict or eliminate fiduciary duties in LLC agreements. Sophisticated parties regularly take advantage of this flexibility by eliminating fiduciary duties of members and directors of LLCs. These same parties, however, often choose…
Bringing an End to “Derivative” Section 14(a) Claims – Without Waiting for the Supreme Court to Weigh In
Much has been written lately about a circuit split on the question whether a company’s forum selection bylaw mandating shareholder derivative lawsuits be brought in Delaware state court trumps a federal lawsuit asserting a derivative claim under Section 14(a) of…
New SEC Disclosure Rules for Cybersecurity Incidents and Governance and Key Takeaways
On July 26, 2023, the U.S. Securities and Exchange Commission (the “SEC” or “Commission”) adopted rules to enhance and standardize disclosure requirements related to cybersecurity incident reporting and cybersecurity risk management, strategy, and governance.…
New York Advances Towards Banning All Non-Competes
Earlier this week, the New York State legislature passed a bill banning all non-competes entered into on or after 30 days past the bill’s enactment, including those entered into by employees or in connection with the sale of a business. …
Updates on Non-Competes
Minnesota bans new employee non-competes beginning July 1, 2023, and the United Kingdom intends to cap their duration at 3 months
Minnesota Becomes the 4th U.S. State to Ban Employee Non-Competes
Following in the footsteps of California, North Dakota and…
Nasdaq and NYSE Propose October 2, 2023 as Effective Date in Amendments to its Proposed Clawback Listing Standards
[Note: This post has been updated to reflect the SEC’s approval of the Nasdaq and NYSE amendments.]
On Friday, June 9, 2023, the U.S. Securities and Exchange Commission (“SEC”) approved, on an accelerated basis, each of the Nasdaq Stock Market’s…