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 September 7.

What to Watch Now in the World of D&O

Kevin LaCroix, The D & O Diary

Every fall since I first started writing this blog, I have assembled a list of the current hot topics in the world of directors' and officers' liability. This year's list is set out below. As should be obvious, there is a lot going on right now in the world of D&O, with further changes just over the horizon. The year ahead could be very interesting and eventful. Here is what to watch now in the world of D&O.

Top Bank Lawyer's E-Mails Show Washington's Inside Game

Robert Schmidt and Jesse Hamilton, Bloomberg

It had been two days since U.S. lawmakers negotiated all night to finish rules that would reshape the business of Wall Street. The 20-hour session left legislators, aides, lobbyists and regulators exhausted. Almost no one had a grip on all the details.

Then Annette Nazareth stepped in. That Sunday morning, she e-mailed a dozen Securities and Exchange Commission officials about the bill that would become the 2,300-page Dodd-Frank Act….

Nazareth's e-mails to Schapiro and then-SEC General Counsel and Senior Policy Director David Becker, obtained through a Freedom of Information Act request filed by Bloomberg News, demonstrate how lobbyists and lawyers draw on bonds they formed in government service to gain access for clients, and how they work to maintain those ties.

The SEC and the First Amendment

Russell G. Ryan, Opinion, The Wall Street Journal

 … [The SEC]  is making First Amendment waves again while pursuing a case in Chicago federal court against former media mogul Conrad Black.

Mr. Black was held liable in 2008 for civil securities fraud, based largely on a related 2007 criminal conviction (which was partially overturned after Supreme Court review in 2010). Although Mr. Black was separately punished in the criminal case, the SEC contends that he now deserves the harshest civil penalties under the law—in his case approximately $4 million. Yet the most notable aspect of the case isn't the large sum demanded by the SEC but rather the commission's justification for the enhanced punishment: namely, that Mr. Black is “unrepentant” and “impenitent.”

Cynics perpetuate ‘revolving door' myth

Robert Khuzami, Guest Post, On the Case

… The academic study, entitled “Does the Revolving Door Affect the SEC's Enforcement Outcomes,” is the first to actually apply some rigorous analysis to the proposition that SEC staff let future job considerations affect their professional judgment. The outcome, not surprising to me, is an emphatic “no” — employment considerations had no measurable impact on enforcement outcomes and that SEC alumni appear to have no measurable advantage on behalf of their clients facing investigation.

This conclusion has common sense in its corner. Enforcement staff, having landed a highly sought-after and difficult-to-obtain job, often passing up other opportunities in the process, would not risk reputation and career and even jail by undermining an investigation for a possible future job prospect. Any enforcement staff member who would consider such a betrayal would be so lacking in respect and credibility as to be of no value to future employers. Nor would they get hired — to put it bluntly, would you hire someone so dishonest, so without principle and held in low esteem by former colleagues (which they would have to be to consider such an act of deceit) to represent you in matters of importance? I have seen no evidence of such a betrayal in my years at the SEC, or in my 15 years in public service. To believe the critics on this point is to have a disturbingly cynical and misguided view of public service and the dedicated and professional members of the Enforcement Division.

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