REID COLLINS PARTNER NORMAN MONHAIT LENDS AMICUS SUPPORT TO IMPORTANT NASDAQ DIRECTOR DIVERSITY DISCLOSURE RULE
Reid Collins Partner and long-time Delaware corporate litigator, Norman M. Monhait, was among a group of distinguished academics, former jurists and corporate law professionals, who joined an amicus curiae brief supporting a NASDAQ rule, which requires listed companies to disclose information about corporate board composition and diversity.
In early 2021, NASDAQ obtained SEC approval to adopt a disclosure rule which required every company listing on the exchange to provide information regarding the diversity of its board membership and, if it does not have one female and one minority director, to explain to investors why it does not.
Opponents of diversity initiatives challenged the rule in the United States Court of Appeals for the Fifth Circuit. Former Delaware Chief Justice, Leo Strine, assembled a group of celebrated corporate law professionals to endorse an amicus brief, which supported NASDAQ and the new rule. Monhait was among the 120 amici, denominated the “Nonpartisan Group of Academics and Practitioners in the Field of Corporate Governance.”
The brief effectively argued that the NASDAQ and other private exchanges have long been free to prescribe listing requirements that set rigorous corporate governance rules and disclosures to benefit investors, and that rejection of the rule would constitute an unprecedented intrusion into private ordering. The Fifth Circuit issued its opinion sustaining the rule on October 18, 2023.
Prior results do not guarantee a similar outcome.