http://www.oilspillcommission.gov/sites/default/files/documents/Chapter4.pdf
PDF: Advance Chapter on BP Well Blowout Investigation | National Oil Spill Commission
January 6, 2011 By Leave a Comment
Antitrust Bar Reacts to New Merger Guidelines | National Law Journal
April 22, 2010 By Leave a Comment
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The Department of Justice and the Federal Trade Commission on Tuesday released proposed revisions to their horizontal merger guidelines, drawing a mixed reaction from the antitrust bar.
The guidelines were last modified in 1997, and the agencies said the new version, which practitioners describe as a top to bottom rewrite, is intended to “more accurately reflect the way the FTC and DOJ currently conduct merger reviews.”
Though the guidelines have no force of law, they are hugely influential. Federal Trade Commission Chairman Jon Leibowitz described the old guidelines as “one of the most cited documents in modern antitrust.”
To some, like Davis Polk & Wardwell counsel Michael Sohn, the new guidelines are “overall a very thoughtful and helpful effort.”
Sohn said the 34-page draft will better enable lawyers and companies to “predict if a merger can be done … the new guidelines conform to what the agencies are actually doing, and provide a much greater level of explanation of points that in some instances were in the old guidelines, but weren’t as fully developed.”
But Dechert partner Paul Denis, who was the principle draftsman of the 1992 guidelines (revised in 1997), said he is troubled by the “enormous amount of flexibility the government has given itself … you don’t know what they’ll do.”
Denis agreed his old guidelines were ripe for revision, but argued the new version is “not as helpful to the business community and the bar. With the old guidelines, you could read them and figure out where the government was likely to come out — you had a good idea where the line is. Now, the line has been re-drawn, but you don’t know where.”
via Law.com – Antitrust Bar Reacts to New Merger Guidelines.
Goldman, Sachs & Co. and Fabrice Tourre | Securities and Exchange Commission
April 17, 2010 By Leave a Comment
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SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21489 / April 16, 2010
Securities and Exchange Commission v. Goldman, Sachs & Co. and Fabrice Tourre, 10 Civ. 3229 (BJ) (S.D.N.Y. filed April 16, 2010)
The SEC Charges Goldman Sachs With Fraud In Connection With The Structuring And Marketing of A Synthetic CDO
The Securities and Exchange Commission today filed securities fraud charges against Goldman, Sachs & Co. (“GS&Co”) and a GS&Co employee, Fabrice Tourre (“Tourre”), for making material misstatements and omissions in connection with a synthetic collateralized debt obligation (“CDO”) GS&Co structured and marketed to investors. This synthetic CDO, ABACUS 2007-AC1, was tied to the performance of subprime residential mortgage-backed securities (“RMBS“) and was structured and marketed in early 2007 when the United States housing market and the securities referencing it were beginning to show signs of distress. Synthetic CDOs like ABACUS 2007-AC1 contributed to the recent financial crisis by magnifying losses associated with the downturn in the United States housing market.
According to the Commission’s complaint, the marketing materials for ABACUS 2007-AC1 — including the term sheet, flip book and offering memorandum for the CDO — all represented that the reference portfolio of RMBS underlying the CDO was selected by ACA Management LLC (“ACA”), a third party with expertise in analyzing credit risk in RMBS. Undisclosed in the marketing materials and unbeknownst to investors, a large hedge fund, Paulson & Co. Inc. (“Paulson”), with economic interests directly adverse to investors in the ABACUS 2007-AC1 CDO played a significant role in the portfolio selection process. After participating in the selection of the reference portfolio, Paulson effectively shorted the RMBS portfolio it helped select by entering into credit default swaps (“CDS”) with GS&Co to buy protection on specific layers of the ABACUS 2007-AC1 capital structure. Given its financial short interest, Paulson had an economic incentive to choose RMBS that it expected to experience credit events in the near future. GS&Co did not disclose Paulson’s adverse economic interest or its role in the portfolio selection process in the term sheet, flip book, offering memorandum or other marketing materials.
The Commission alleges that Tourre was principally responsible for ABACUS 2007-AC1. According to the Commission’s complaint, Tourre devised the transaction, prepared the marketing materials and communicated directly with investors. Tourre is alleged to have known of Paulson’s undisclosed short interest and its role in the collateral selection process. He is also alleged to have misled ACA into believing that Paulson invested approximately $200 million in the equity of ABACUS 2007-AC1 (a long position) and, accordingly, that Paulson’s interests in the collateral section process were aligned with ACA’s when in reality Paulson’s interests were sharply conflicting. The deal closed on April 26, 2007. Paulson paid GS&Co approximately $15 million for structuring and marketing ABACUS 2007-AC1. By October 24, 2007, 83% of the RMBS in the ABACUS 2007-AC1 portfolio had been downgraded and 17% was on negative watch. By January 29, 2008, 99% of the portfolio had allegedly been downgraded. Investors in the liabilities of ABACUS 2007-AC1 are alleged to have lost over $1 billion. Paulson’s opposite CDS positions yielded a profit of approximately $1 billion.
The Commission’s complaint, which was filed in the United States District Court for the Southern District of New York, charges GS&Co and Tourre with violations of Section 17(a) of the Securities Act of 1933, 15 U.S.C. §77q(a), Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. §78j(b) and Exchange Act Rule 10b-5, 17 C.F.R. §240.10b-5. The Commission seeks injunctive relief, disgorgement of profits, prejudgment interest and civil penalties from both defendants.
via Goldman, Sachs & Co. and Fabrice Tourre.
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Inspector General Report: Investigation of the SEC’s Response to Concerns Regarding Robert Allen Stanford’s Alleged Ponzi Scheme
April 16, 2010 By Leave a Comment
REPORT OF INVESTIGATION
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
OFFICE OF INSPECTOR GENERAL
Case No. OIG-526
Investigation of the SEC’s Response to Concerns
Regarding Robert Allen Stanford’s Alleged Ponzi Scheme
March 31, 2010
Civil Complaint for Investment Fraud | Securities and Exchange Commission v Goldman, Sachs & Co. | Justia.com – JDSupra
April 16, 2010 By Leave a Comment
The Securities and Exchange Commission is suing Goldman, Sachs for defrauding investors by misstating and omitting key facts about a financial product tied to subprime mortgages as the U.S. housing market was beginning to falter.
The SEC alleges that Goldman Sachs structured and marketed a synthetic collateralized debt obligation (CDO) that hinged on the performance of subprime residential mortgage-backed securities (RMBS). Goldman Sachs failed to disclose to investors vital information about the CDO, in particular the role that a major hedge fund played in the portfolio selection process and the fact that the hedge fund had taken a short position against the CDO.
Investors are alleged to have lost more than $1 billion.
The SEC’s complaint charges Goldman Sachs and Goldman Sachs Vice President Fabrice Tourre with violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Exchange Act Rule 10b-5. The Commission seeks injunctive relief, disgorgement of profits, prejudgment interest, and financial penalties.
Elan Sues to Ban Apple Multitouch Products in U.S. — Even the iPad
March 30, 2010 By
Elan Microelectronics filed suit against Apple with the U.S. International Trade Commission today, alleging that certain Apple products violate a multitouch patent previously awarded to the Taiwanese company. Elan in April of last year filed a related suit with the U.S. District Court in Northern California over the same patent — No. 7,274,353 — which it calls “a fundamental patent to the detection of multi-fingers that allows for any subsequent multi-finger applications to be implemented.”
By going to the ITC in addition to filing a patent infringement suit, Elan seeks to block Apple from importing its products into the U.S. that use multitouch, including the iPhone, iPod touch, MacBook, Magic Mouse and the iPad, which is due for release on April 3. Since Apple products are designed in Cupertino but assembled outside of the U.S., Elan is courting the appropriate trade commission that has authority to stop such products from reaching America’s shores. Notably, any ITC findings will be binding regardless of the patent lawsuit outcome, thanks to a loophole in U.S. patent law. Ironically, Apple is using this same strategy to try and block HTC from importing phones that Cupertino alleges violate its patents.
via Elan Sues to Ban Apple Multitouch Products in U.S. — Even the iPad.
S.E.C. Looks for Lehman-Style Accounting on Wall St. – NYTimes.com
March 30, 2010 By
The Securities and Exchange Commission said on Monday it had started an inquiry into about two dozen financial companies to determine whether they followed accounting practices similar to those recently disclosed in an investigation of Lehman Brothers.
The commission is interested in transactions known as repurchase agreements, which are a common way that investment banks provide funds for trading activities. The commission wants to know whether other Wall Street players used tactics like those that Lehman used to mask their debt levels from investors.
The commission announced that it had sent inquiry letters but did not list the companies they were sent to. The inquiry comes as part of the S.E.C.’s duties to review financial filings of public companies. Any red flags in the answers will be forwarded to the S.E.C.’s enforcement unit, which has the power to bring charges.
Since Lehman was accused of using a transaction known as Repo 105 in 2008 to hide about $50 billion in debt, analysts have said there should be a widespread inquiry of accounting on Wall Street before the financial crisis.
“There were a multitude of games that were going on in accounting,” said Janet Tavakoli, president of Tavakoli Structured Finance. “It’s good the S.E.C. is looking at Repo 105, but it obviously leads to other questions.”
via S.E.C. Looks for Lehman-Style Accounting on Wall St. – NYTimes.com.
How the New EU Rules on Data Export Affect Companies in and Outside the EU | Dr. Thomas Helbing – Kanzlei für Datenschutz-, Online- und IT-Recht
March 27, 2010 By
On 5 February 2010 the Commission of the European Union (EU) has updated the set of standard contractual clauses for the transfer of personal data to processors in non-EU countries. The old clauses are repealed with effect from 15 May 2010.
Standard contractual clauses are an important instrument for companies in the EU to comply with national data protection laws if information on individuals is transferred to or accessed by organizations outside the EU.
The EU Commission decision is relevant for all organization receiving personal data – for example customer or employee data – from subsidiaries, customers or vendors in the EU.
In addition, the new standard contractual clauses will also affect companies who indirectly receive personal data that originally comes from the EU, e.g. by providing services to companies which process EU data. This is because the new standard contractual clauses require from companies importing personal data from the EU to contractually impose the terms of the clauses on any subcontractor to which they transfer personal data or grant access.
In particular, agreements on outsourcing, cloud computing, software as a service (SaaS) or application service providing (ASP) and software like Human Resources Information Systems (HRIS) Customer Relationship Management (CRM) tools and Enterprise Resource Planning (ERP) software are affected.
