Supreme Court’s Empty Seat Creates Uncertainty in Business Litigation
While the political fight over Justice Scalia’s empty seat on the U.S. Supreme Court plays out, legal observers have noted the troubling uncertainties that an eight-justice court creates for businesses and the economy. Recently, Dow Chemical settled a billion dollar class action lawsuit for which its appeal to the highest court would have relied on key Scalia opinions.
Executive Perks in the Spotlight
The Financial Times recently released its “Corporate Jet Files” detailing the spending by S&P 500 companies on personal use by executives of a company’s corporate jet. This practice, though permissible under the policies and procedures of many companies, is nevertheless controversial.
More CEO Candidates Rising from Insider Ranks
According to executive search firm Spencer Stuart, over 70 percent of S&P 500 companies that chose a new CEO in 2015 selected a company insider. This percentage is the highest since 2004, when Spencer Stuart began tracking CEO transitions at these companies.
Time to Review Advancement and Indemnification Provisions
Recent Delaware cases suggest that companies should review their indemnification provisions carefully to assess whether they will protect former officers and directors as intended. Without clear language in a bylaw or contract, Delaware courts will not enforce provisions to advance the costs and expenses incurred by former officers and directors in covered proceedings.
The Ticker shares recent developments in SEC compliance, capital markets, corporate governance, executive compensation and other matters important to public companies and their officers and directors. It is published by Fredrikson & Byron’s Public Companies Group.