December 3, 2021

Volume XI, Number 337

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December 02, 2021

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November 30, 2021

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Claw Backs And Preemption

Last week, the Securities and Exchange Commission announced that it was reopening the comment period on proposed rules for listing standards for the recovery of erroneously awarded compensation.   One issue that I doubt that they are looking for is whether stock exchange listing rules can preempt state labor and employment laws.   This was an issue that I raised over six years ago in a post.  Section 221 of the California Labor Code has long provided that "It shall be unlawful for any employer to collect or receive from an employee any part of wages theretofore paid by said employer to said employee".  In this regard, some readers may recall this 2013 post discussing Judge Diarmuid F. O'Scannlain's opinion in McDaniel v. Wells Fargo Invs., LLC, 717 F.3d 668 (9th Cir. 2013) in which he states that SRO rules have the "force of law".  

© 2010-2021 Allen Matkins Leck Gamble Mallory & Natsis LLP National Law Review, Volume XI, Number 292
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About this Author

Keith Paul Bishop, Corporate Transactions Lawyer, finance securities attorney, Allen Matkins Law Firm
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Keith Bishop works with privately held and publicly traded companies on federal and state corporate and securities transactions, compliance, and governance matters. He is highly-regarded for his in-depth knowledge of the distinctive corporate and regulatory requirements faced by corporations in the state of California.

While many law firms have a great deal of expertise in federal or Delaware corporate law, Keith’s specific focus on California corporate and securities law is uncommon. A former California state regulator of securities and financial institutions, Keith has decades of...

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