From the Editor...
With the deadline looming to comment on the SEC's fair valuation rule proposal, industry participants are weighing in. Independent Directors Council submitted its comments last week, calling on the regulator to modify the rule to make it less prescriptive and give fund firms more implementation time. "IDC's recommendations would preserve the robust oversight role of fund boards, while providing a durable framework for fair valuation that can stand the test of time," IDC Managing Director Thomas Kim wrote in the group's comment letter.
In the courts, the U.S. Court of Appeals for the Third Circuit has denied a petition from plaintiffs for an en banc session in a 36(b) case against BlackRock. The outcome wasn't a surprise, as such petitions are always long shots, and litigators had told FBV that it was particularly unlikely to be successful in this case. One litigator called the petition a "real Hail Mary play." The court's ruling puts an end to a case that originated six years ago and was heard in court in August 2018, and is another victory for the industry, which has been plagued by 36(b) cases for years.
In the boardroom, directors continue to get down to business with 15(c) work, with many boards starting the process in the spring and planning to hold votes in September or October. Obviously, these directors aren't actually in a boardroom; they're on a virtual platform or the telephone. The new COVID-19 normal isn't stopping progress on contract approvals and renewals, however, as boards are adapting well to meeting remotely. Some even think the process could become more efficient as a result of the virtual meeting format, but that will remain to be seen when directors are—at some point—able to meet in person again.
Just because they can meet in person again, will they have to—and choose to? That is the question explored in our most recent Viewpoints, In-Person Board Meetings Are So 2019 by Jay Baris and Nathan Greene at Sidley Austin. It's a timely and interesting read, so be sure to check it out.
Don't forget to also check out (and download) our latest monthly PDF, which contains all the stories we published in June in a single place. It's a great way to make sure you don't miss anything!
Hillary Jackson, founding editor