Last week the U.S. Chamber of Commerce and the Business Roundtable announced the filing of a joint lawsuit challenging the Securities and Exchange Commission’s adoption of proxy access Rule 14a-11. The groups also filed a motion requesting that the Commission stay the effect of the Rule pending resolution of the suit.
Today the Commission did just that; staying not only the effect of Rule 14a-11, but also of the amendments to Rule 14a-8. The groups’ motion didn’t actually request a stay of the effect of the amendments to Rule 14a-8, but the Commission reasoned that the amendments, “designed to complement” Rule 14a-11, were so “intertwined” that allowing them to become effective while staying Rule 14a-11 could potentially be confusing.
At this point the Commission and the groups will file a joint motion with the U.S. Court of Appeals for the District of Columbia Circuit requesting an expedited review of the suit. However, as reported by Bloomberg, the Commission doesn’t expect the suit to be resolved until “late spring”. So, even if the Commission prevails, it now looks like the new proxy access rules will not affect most issuers before the 2012 proxy season.