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Bon mots

"You can observe a lot just by watching." Yogi Berra

"We do not distain to borrow wit or wisdom from any man who is capable of lending us either." Henry Fielding, Tom Jones

"In our complex society the accountant's certificate and the lawyer's opinion can be instruments for inflicting pecuniary loss more potent than the chisel or the crowbar." United States v. Benjamin, 328 F.2d 854, 862 (2d Cir. 1964)

Briefs Sealed in 102(e) Appeal

Kevin Hall, CPA and Rosemary Meyer, CPA, Exchange Act Rel. 60346, July 20, 2009

The Commission granted a protective order sealing parts of respondents' and the Division of Enforcement's briefs. The order covers those portions of the briefs that address the Division's investigation preceding the case. The Commission offered no explanation for its order other than to conclude that "the harm resulting from complete disclosure outweighs the benefits." It noted that the Division did not contest the motion.

We will have to await the Commission's opinion to find out what this is all about. It is highly unusual for the Commission to seal substantive portions of briefs. Usually it only seals confidential personal financial information provided by litigants who are seeking to avoid penalties or disgorgement.

This was a case charging the respondent CPAs with violation of Commission Rule 102(e). This rule allows the Commission to discipline CPAs in connection with their audits of public companies. The ALJ's January 15, 2008, initial decision dismissing the proceedings is here. She found no violations of Commission Rule 102(e) by Hall and Meyer.