The massive volatility and turbulence in the financial markets and domestic and global economies that was experienced in 2008 and that is continuing in 2009 will result in significant shifts in the regulatory landscape for private investment funds, including hedge funds, private equity funds, venture capital funds, real estate funds, and many collateralized debt obligations (CDOs) and collateralized loan obligations (CLOs) (collectively, private investment funds).

A September 4 decision from the Ninth Circuit holds that portions of California's statute restricting the sharing of information among affiliates are not preempted by the Fair Credit Reporting Act, and must be severed from those portions of the statute that are preempted.

The Securities and Exchange Commission has issued three new emergency orders in response to unsettled market conditions.

On October 23, 2008, the Federal Deposit Insurance Corporation (“FDIC”) issued an interim rule (the “Rule”) relating to the Temporary Liquidity Guarantee Program (“TLGP”) that the FDIC announced on October 14, 2008.

On March 3, 2009, the Federal Reserve Board released the final terms and conditions applicable to the initial loan subscription, including loan rates and collateral haircuts, relating to its previously announced Term Asset-Backed Securities Loan Facility.

On March 23, 2009, the Department of the Treasury released more information regarding its new Public Private Investment Program, or “PPIP.”

Due to the unprecedented nature of the current financial crisis, certain sectors of the insurance industry have faced significant challenges concerning their surplus and risk-based capital levels.

On July 15, 2009, the Obama administration released the “Private Fund Investment Advisers Registration Act of 2009” (the “Bill”), which would require that advisers to private funds register with the Securities and Exchange Commission (the “SEC”) and be subject to new and significant disclosure and recordkeeping requirements.

This update summarizes recent developments from the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) regarding private capital investments in failed depository institutions.

On July 22, 2009, the U.S. Securities and Exchange Commission (the “SEC”) held an open meeting, during which it voted to propose new rule 206-4(5) (the “Proposed Rule”) under the Investment Advisers Act of 1940 (as amended, the “Advisers Act”) designed to eliminate “pay-to-play” practices.

On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Tax Act of 2009.

Department of Homeland Security Secretary Michael Chertoff has announced a new focus on corporate and worksite enforcement as part of a crackdown on the violation of the federal immigration laws.

Earning Public Trust Amid Heightened Tech Regulation.

On June 17, 2009, the Obama administration outlined its much-anticipated framework for financial regulatory reform (the “Financial Reform Plan” or “Plan”) in its release “Financial Regulatory Reform, A New Foundation: Rebuilding Financial Supervision and Regulation” and the accompanying fact sheets.

A key element of the UK’s response to the credit crisis is the introduction of legislation to give its authorities new powers of intervention with regard to UK banks and building societies, and to introduce two additional insolvency procedures specifically for such entities.

On July 27, 2009, the Securities and Exchange Commission issued a release making permanent the close-out requirements of former interim final temporary Rule 204T, which are intended to address “naked” short selling and “fails to deliver” in all equity securities.

On July 29, 2009, the U.S. Department of Energy (DOE) issued two solicitations for applications pursuant to the loan guarantee program authorized by Title XVII of the Energy Policy Act of 2005 (EPAct 2005).

President Obama signed into law H.R. 1, the “American Recovery and Reinvestment Act of 2009” on February 17, 2009.

On June 24, 2009, the Securities and Exchange Commission (the “SEC” or the “Commission”) held an open meeting (the “Meeting”) to consider a recommendation from the Staff of the Division of Investment Management (the “Division”) to propose amendments to Rule 2a-7 (the “Rule”) under the Investment Company Act of 1940 (the “Act”).

On March 26, 2009 the U.S. Department of the Treasury outlined its framework for financial regulatory reform in a release and through Secretary of Treasury Geithner’s testimony before the U.S. House of Representatives Committee on Financial Services.