Corporate Securities Law Blog

In United States v. Stringer, 2008 WL 901563 (9th Cir. Apr. 4, 2008), the United States Court of Appeals for the Ninth Circuit vacated a final order of the United States District Court for the District of Oregon that had dismissed criminal indictments against three individual defendants.  Those defendants had argued successfully before the district court that their rights had been violated by the Securities & Exchange Commission (“SEC”) when they cooperated voluntarily with an SEC investigation allegedly without knowing that the SEC was working with federal prosecutors on a parallel criminal prosecution.  The Ninth Circuit also vacated the district court’s alternative order suppressing evidence obtained during an SEC civil investigation.  This decision paves the way for reinstatement of criminal charges against the defendants and likely will encourage further cooperation between prosecutors and SEC enforcement personnel to gain strategic and tactical advantages against investigation targets.

The California Franchise Tax Board has announced that it will not appeal a recent court ruling that a fee levied on limited liability companies is an unconstitutional tax. The FTB plans to issue a notice April 14 addressing how protective refund claims filed by taxpayers will be handled. The deadline for filing a refund claim for the 2003 tax year is April 15, 2008.