Are the flood gates open with respect to challenges to Dodd-Frank after the D.C. Circuit’s decision in Business Roundtable v. SEC, No. 10-1305 (D.C. Cir. Jul. 22, 2011), which struck Rule 14a-11 because it failed to assess economic consequences? Industry representatives have begun to explore legal challenges to the Securities and Exchange Commission’s (“SEC”) latest corporate whistle-blower program and a provision surrounding the extraction of oil and natural gas from foreign countries. In addition, industry representatives are also challenging the Commodity Futures Trading Commission’s plan to curb speculative trading.
Lurking behind these challenges is the Business Roundtable decision. The legal challenges are based on a 1996 law that requires the SEC to promote “efficiency, competition and capital formation.” The law enabled the financial industry to build lawsuits around the economic costs of a rule, regardless of its merits.