Throughout the week over at Securities Docket, I highlight the most interesting columns and blog posts from around the web on the subjects of SEC enforcement and securities litigation. Here is a digest of my picks for the week ending August 26.

The Need for Fundamental S.E.C. Reform

ChamberPost | David Hirschman | Aug 26, 2011

Earlier this month, former S.E.C Chairman Arthur Levitt published an Op-Ed piece in The New York Times, entitled “Don't Gut the S.E.C.”  Mr. Levitt sees only two approaches to regulatory reform when it comes to his former agency: on the one hand, retaining the status quo, or, on the other hand, in his words, “gutting” or “eviscerating” the agency.  We are saddened that his debate about regulatory reform has become one more example of a black and white view of governmental reform.  In reality, we agree with Mr. Levitt on what is clearly the most important point:  the clear need for an effective S.E.C. We strongly disagree; however, that the S.E.C. is somehow exempt from the basic need to adapt to changing times, or that more of the same is the right answer.

Despite Reg FD, study finds traders profit from private CEO meetings

IR Web Report | Dominic Jones | Aug 24, 2011

In May, the Wall Street Journal sparked a public storm when it called attention to the long-standing practice of corporate executives and investment bankers meeting privately with institutional traders.  The same month, a survey of 400 investors and analysts by PwC and the Rotterdam School of Management found that 47% said they often receive material information in one-on-one meetings with companies. In the latest study, professors Brian Bushee of the University of Pennsylvania, Michael Jung of New York University and Gregory Miller of the University of Michigan say they have found evidence that “investors exploit their selective access to management to execute larger and more profitable trades.”

Who Authorized Document Destruction at the SEC?

POGO | Michael Smallberg and Paul Thacker | Aug 23, 2011

DealBook columnist Peter J. Henning argued yesterday that the shredding of thousands of pages of documents "looks more like corner cutting to avoid cumbersome federal regulations." But in a letter sent last week to the National Archives and Records Administration (NARA) and the Securities and Exchange Commission (SEC) Office of Inspector General (OIG), whistleblower attorney Gary Aguirre suggests there may be more to it than that, and raises new questions about the SEC's alleged document destruction policy. One of those key questions, which so far seems to have eluded Henning and other close observers, is this: who at the SEC authorized the policy?

Second Circuit Says Subclasses Need Their Own Attorneys

Class Action Countermeasures | Andrew Trask | Aug 22, 2011

...[w]hile the rationale may be simple, the execution is likely to be anything but. Class-action lawyers are a notoriously competitive lot. Many of them find it extremely difficult to work with each other, in part because they find it hard to trust each other. So finding a separate lawyer (presumably from a separate firm) for each subclass who will "press its most compelling case" will be extraordinarily difficult for them. This is good news for defendants, who often watch class actions rife with conflicts of interest get certified. Of course, class-action lawyers are also notably inventive; it will be interesting to see what they come up with to get around this requirement.

Securities Suits Against U.S.-Listed Chinese Companies Continue in Year's Second Half

D&O Diary | Kevin LaCroix | Aug 22, 2011

With the arrival of the lawsuit against SinoTech Energy, there have now been five securities class action lawsuits filed against U.S. listed Chinese companies so far in the year's second half,  bringing the year to date total to 29. The law firm's “investigation” press releases suggest that there may well be more suits yet to come. It appears that as long as the online commentators continue their barrage of negative reports about the Chinese companies, the plaintiffs' lawyers will have a steady supply of lawsuit fodder.  To be sure, eventually the wave of lawsuits against U.S.-listed Chinese companies will play itself out. It just seems that for now the lawsuit filing phenomenon still has further to run.