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The Securities Act of 1933: Assessing and Managing IP Liability
For nearly 75 years, the initial public offering ('IPO') of securities has been regulated by the Securities and Exchange Commission under the authority of the Securities Act of 1933. Among other considerations, the 1933 Act requires the disclosure of anything that might affect the value of the securities being issued and imposes civil liability on those that sign registration statements containing material omissions of fact. Over that same 75-year period, the role of intellectual capital as a leading driver of corporate value has increased significantly. As a result, an issuer's officers, directors, lawyers, underwriters, and auditors should consider whether they fully understand (and disclose) the extent to which intellectual capital drives their company value and risk.
The 1933 Act
In simple terms, the 1933 Act was enacted to ensure that investors had access to sufficient information to make informed investment decisions. To that end, the 1933 Act requires:
most issuers to file registration statements with the SEC that contain financial and other significant information concerning the securities being issued to prospective investors. Registration statements generally must contain information about the issuer's properties and business, the security being offered for sale, the management of the issuer, and the issuer's audited financial statements.
Section 11 of the 1933 Act imposes civil liability on anyone who signs a registration statement containing a material misrepresentation or omission of fact. Importantly, a finding of liability under '11 does not require proof of negligence or intent to deceive on the part of the defendant, nor does it require a showing of reliance on the misrepresented/omitted fact on the part of the plaintiff. Rather, if a registration statement contains a material misrepresentation or omission of fact, liability may be demonstrated with two simple elements: 1) the plaintiff acquired the stock; 2) the plaintiff suffered a loss (i.e., damages). Liability under '11 of the 1933 Act extends to every person who signed the registration statement, as well as other related parties including officers and directors of the issuer, accountants, engineers, appraisers, lawyers, underwriters, and those who prepared or certified any part of the registration statement. In practical terms, the 1933 Act requires the disclosure of any material facts that might affect the value of the securities being issued and imposes stringent liability on those with inadequate registration disclosures.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.
The Anti-Assignment Override Provisions
UCC Sections 9406(d) and 9408(a) are one of the most powerful, yet least understood, sections of the Uniform Commercial Code. On their face, they appear to override anti-assignment provisions in agreements that would limit the grant of a security interest. But do these sections really work?