by Cydney Posner

Today, President Obama nominated two candidates to fill the two open positions for SEC Commissioner. The nominations require Senate confirmation. Those open meetings should be even more fun now!

For the Republican candidate, President Obama nominated Hester Peirce, a researcher at the Mercatus Center at George Mason University and a former Senate Banking Committee staffer (where she worked with current SEC Commissioner Michael Piwowar).  She would replace former SEC Commissioner Daniel Gallagher. She was also a staffer for former SEC Commissioner Paul Atkins. According to Politico Pro, she has conducted extensive research and voiced criticism of Dodd-Frank.

For the Democratic candidate, the President nominated Lisa Fairfax, a professor at George Washington Law School since 2009, to fill the slot to be vacated by Luis Aguilar. According to  Politico Pro, her research has focused on corporate governance issues and shareholder activism.  She was a signatory to an amicus brief, along with other academics, in the Trinity Wall Street v. Wal-Mart case, in favor of Trinity and opposed to the SEC staff position. (Politico reports that one of the candidates for the post who was not selected for the position had helped business groups prepare an amicus brief in favor of Wal-Mart.)

Sidebar: In Trinity Wall Street v. Wal-Mart, Trinity, an Episcopal church,  had submitted a shareholder proposal requesting that Wal-Mart’s board of directors develop a policy regarding the sale of high-capacity firearms, such as the AR-15 assault rifle, and other dangerous products. Wal-Mart sought to exclude Trinity’s proposal from its proxy statement under the “ordinary business operations” exclusion of Rule 14a-8(i)(7). The SEC staff took a no-action position permitting exclusion, but Trinity challenged the exclusion in court. The federal district court in Delaware enjoined Wal-Mart from excluding Trinity’s shareholder proposal from Wal-Mart’s proxy materials, notwithstanding the no-action position of the SEC staff. On appeal, the Third Circuit  vacated the injunction, and Trinity filed a cert petition.  The petition raises issues not only about the proper interpretations of the “ordinary business” exclusion and the “transcendent social policy“ exception, but also about the weight to be given to SEC staff no-action letters.  See this PubCo post for a discussion of the opinion, this post for a discussion of the oral argument and this post for a more detailed discussion of the procedural and other background of the case. This PubCo post discusses the cert petition.)

Posted by Cydney Posner