The Business Roundtable and the U.S. Chamber of Commerce have convinced a federal appellate court to overturn a proposed Securities and Exchange Commission rule that would have made it easier for shareholders to nominate candidates for the corporate boards of directors. A unanimous panel of the U.S. Court of Appeals for the D.C. Circuit rejected the rule, ruling that the SEC had failed to adequately consider its potential impact.
“By ducking serious evaluation of the costs that could be imposed upon companies from use of the rule by shareholders representing special interests, particularly union and government pension funds, we think the Commission acted arbitrarily,” Judge Douglas Ginsburg said in Business Roundtable v. Securities & Exchange Commission, 10-1305, joined by Chief Judge David Sentelle and Judge Janice Rogers Brown.
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