SEC Stays Rules Facilitating Shareholder Nomination of Directors

The Business Roundtable and the U.S. Chamber of Commerce (the Petitioners) filed a petition on September 29, 2010, with the U.S. Court of Appeals for the District of Columbia Circuit seeking review of recent changes to the proxy rules adopted by the Securities and Exchange Commission (the Commission). These rule changes, including newly adopted Rule 14a-11 and amended Rule 14a-8, would enable certain shareholders or shareholder groups to have included in a company's proxy materials: (i) shareholder nominees for director and (ii) shareholder proposals to amend provisions of a company's governing documents regarding the procedures for shareholders to nominate directors. The same day, the Petitioners also filed with the Commission a motion to stay Rule 14a-11, including the November 15, 2010, effective date of the rules, pending judicial review.