This case was last updated from U.S. District Courts on 12/12/2021 at 10:56:43 (UTC).

National Association of Manufacturers et al v. United States Securities and Exchange Commission et al

Case Summary

On October 13, 2021, National Association of Manufacturers (NAM) and Natural Gas Services Group, Inc. (NGS) (collectively “Plaintiffs”), represented by Debbie E. Green of McDermott Will & Emery LLP, filed a civil action involving review of government regulations against United States Securities and Exchange Commission (SEC) and Gary Gensler (collectively “Defendants”), seeking declaratory and injunctive relief for SEC’s suspension of the Proxy Advice Rule as allegedly unlawful. This case was filed in the U.S. District Court in the Western District of Texas with Judges David Counts and Ronald C. Griffin presiding. 

In their complaint, Plaintiffs alleged that “In view of these serious concerns, the United States Securities and Exchange Commission (SEC) extensively investigated whether it should implement basic safeguards with respect to proxy voting advice. After collecting numerous examples of voting advice offered notwithstanding an undisclosed conflict of interest, as well as examples of routine inaccurate information, the SEC promulgated a rule—the Proxy Advice Rule—to impose modest protections for investors and issuers alike. See generally Exemptions from the Proxy Rules for Proxy Voting Advice, 85 Fed. Reg. 55,082 (Sept. 3, 2020) (Proxy Advice Rule).”

Plaintiffs further alleged that “In summary, the Rule clarifies that the provision of proxy voting advice generally constitutes a solicitation under the federal proxy rules. Usually, entities soliciting a proxy are subject to various information and filing requirements. The Rule exempts proxy firms from these requirements, provided that they disclose potential conflicts of interest to their clients, supply companies subject to their analyses with information about their final voting recommendations, and notify their clients prior to the vote if the subject companies respond to their recommendations. It also subjects proxy firms to the federal proxy rules’ antifraud provisions. The Rule thus functions as an exemption to more burdensome requirements to which the proxy firms’ activity would normally subject them under federal law.”

Plaintiffs also alleged that “This action immediately harms publicly traded companies and their shareholders, precluding them from receiving the disclosures that the SEC earlier determined were essential to protect the public markets. The SEC’s suspension of the Proxy Advice Rule is flatly unlawful. The SEC may not decide that it no longer stands by a regulation it earlier lawfully promulgated, and—absent any rulemaking process—simply suspend its application. To the contrary, the procedural provisions of the Administrative Procedure Act (APA) exist precisely to bring regularity to agency action.”

Plaintiffs have laid down one claim for relief which relates to the Administrative Procedure Act – unlawful amendment of a binding regulation. Plaintiffs alleged that by purporting to delay the compliance date for the Proxy Advice Rule without providing notice and an opportunity for public comment pursuant to the APA, the SEC has acted “without observance of procedure required by law” and “otherwise not in accordance with law.” 5 U.S.C. § 706(2). The agency’s purported suspension of the compliance date must therefore be “set aside.” 

In their prayer for relief, Plaintiffs requested the court to “[S]et aside” Defendants’ suspension of the compliance date for the Proxy Advice, issue a declaratory judgment declaring that Defendants’ suspension of the compliance date for the Proxy Advice Rule is unlawful and void, enjoin Defendants from enforcing or otherwise carrying out the suspension of the compliance date for the Proxy Advice Rule, and award Plaintiffs such other and further relief as the court may deem just and proper.

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Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    7:21-CV-00183

  • Filing Date:

    10/13/2021

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Other - Administrative Procedure Act

Judge Details

Presiding Judge

David Counts

Referral Judge

Ronald C. Griffin

 

Party Details

Plaintiffs

National Association of Manufacturers

Natural Gas Services Group, Inc.

Defendants

United States Securities and Exchange Commission

Gary Gensler

Attorney/Law Firm Details

Plaintiff Attorneys

Debbie E. Green

Andrew A. Lyons-Berg

Erica T. Klenicki

Patrick D. Hedren

Paul W. Hughes

Defendant Attorneys

B. David Fraser

Daniel Matro

Tracey A. Hardin

Keefe Bernstein

 

Court Documents

#28

(#28) Pro Hac Vice Letter to Attorney Daniel E. Matro. (jb3) (Entered: 12/10/2021)

#27

(#27) Pro Hac Vice Letter to Attorney Dan M. Berkovitz. (jb3) (Entered: 12/10/2021)

21 #28

Taylor Decl. Ex. F

21 #26

Taylor Decl. Ex. D

21 #25

Taylor Decl. Ex. C

21 #21

Netram Decl. Ex. P

21 #19

Netram Decl. Ex. N

21 #12

Netram Decl. Ex. G

21 #11

Netram Decl. Ex. F

#5

#4

#3

#2

1 #4

Civil Cover Sheet

1 #3

Exhibit C

1 #2

Exhibit B

1 #1

Exhibit A

#1

73 More Documents Available
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Docket Entries

  • 12/10/2021
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  • Docket(#28) Pro Hac Vice Letter to Attorney Daniel E. Matro. (jb3) (Entered: 12/10/2021)

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  • 12/10/2021
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  • Docket(#27) Pro Hac Vice Letter to Attorney Dan M. Berkovitz. (jb3) (Entered: 12/10/2021)

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  • 12/08/2021
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  • Docket(#26) Response in Opposition to Motion, filed by Gary Gensler, United States Securities and Exchange Commission, re #21 MOTION for Summary Judgment filed by Plaintiff National Association of Manufacturers, Plaintiff Natural Gas Services Group, Inc. (Attachments: #1 Declaration of Daniel E. Matro, #2 Matro Decl. Ex. 1, #3 Matro Decl. Ex. 2)(Matro, Daniel) (Entered: 12/08/2021)

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  • 12/08/2021
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  • Docket(#25) Cross MOTION for Summary Judgment by Gary Gensler, United States Securities and Exchange Commission. (Attachments: #1 Declaration of Daniel E. Matro, #2 Matro Decl. Ex. 1, #3 Matro Decl. Ex. 2). Motions referred to Judge Ronald C. Griffin. (Matro, Daniel) (Entered: 12/08/2021)

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  • 11/18/2021
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  • Docket(#24) NOTICE of Attorney Appearance by Keefe Bernstein on behalf of Gary Gensler, United States Securities and Exchange Commission. Attorney Keefe Bernstein added to party Gary Gensler(pty:dft), Attorney Keefe Bernstein added to party United States Securities and Exchange Commission(pty:dft) (Bernstein, Keefe) (Main Document 24 replaced on 11/19/2021- replaced document with flattened copy) (jb3). (Entered: 11/18/2021)

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  • 11/17/2021
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  • Docket(#23) ORDER GRANTING #22 Joint Motion to Establish Briefing Schedule. Signed by Judge Ronald C. Griffin. (jb3) (Entered: 11/18/2021)

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  • 11/10/2021
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  • Docket(#22) Joint MOTION to establish a briefing schedule re #21 MOTION for Summary Judgment by National Association of Manufacturers, Natural Gas Services Group, Inc.. (Attachments: #1 Proposed Order). Motions referred to Judge Ronald C. Griffin. (Hughes, Paul) (Entered: 11/10/2021)

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  • 11/05/2021
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  • Docket(#21) MOTION for Summary Judgment by National Association of Manufacturers, Natural Gas Services Group, Inc.. (Attachments: #1 Declaration of Paul W. Hughes, #2 Hughes Decl. Ex. A, #3 Hughes Decl. Ex. B, #4 Hughes Decl. Ex. C, #5 Declaration of Christopher Netram, #6 Netram Decl. Ex. A, #7 Netram Decl. Ex. B, #8 Netram Decl. Ex. C, #9 Netram Decl. Ex. D, #10 Netram Decl. Ex. E, #11 Netram Decl. Ex. F, #12 Netram Decl. Ex. G, #13 Netram Decl. Ex. H, #14 Netram Decl. Ex. I, #15 Netram Decl. Ex. J, #16 Netram Decl. Ex. K, #17 Netram Decl. Ex. L, #18 Netram Decl. Ex. M, #19 Netram Decl. Ex. N, #20 Netram Decl. Ex. O, #21 Netram Decl. Ex. P, #22 Declaration of Stephen C. Taylor, #23 Taylor Decl. Ex. A, #24 Taylor Decl. Ex. B, #25 Taylor Decl. Ex. C, #26 Taylor Decl. Ex. D, #27 Taylor Decl. Ex. E, #28 Taylor Decl. Ex. F, #29 Taylor Decl. Ex. G). Motions referred to Judge Ronald C. Griffin. (Hughes, Paul) (Entered: 11/05/2021)

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  • 10/22/2021
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  • DocketText Order GRANTING #20 Patrick D. Hedren's Motion to Appear Pro Hac Vice. Pursuant to our Administrative Policies and Procedures for Electronic Filing, the attorney hereby granted to practice Pro Hac Vice in this case must register for electronic filing with our Court within 10 days of this Order. It is further ORDERED that if Mr. Hedren has not already done so, shall immediately tender the amount of $100.00, made payable to: Clerk, U.S. District Court, in compliance with Local Court Rule AT-1(f)(2). Entered by Judge Ronald C. Griffin. (This is a text-only entry generated by the court. There is no document associated with this entry.) (db) (Entered: 10/22/2021)

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  • 10/22/2021
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  • DocketText Order GRANTING #19 Erica T. Klenicki's Motion to Appear Pro Hac Vice. Pursuant to our Administrative Policies and Procedures for Electronic Filing, the attorney hereby granted to practice Pro Hac Vice in this case must register for electronic filing with our Court within 10 days of this Order. It is further ORDERED that if Ms. Klenicki has not already done so, shall immediately tender the amount of $100.00, made payable to: Clerk, U.S. District Court, in compliance with Local Court Rule AT-1(f)(2). Entered by Judge Ronald C. Griffin. (This is a text-only entry generated by the court. There is no document associated with this entry.) (db) (Entered: 10/22/2021)

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15 More Docket Entries
  • 10/13/2021
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  • Docket(#9) Pro Hac Vice Letter to Attorney Andrew A. Lyons-Berg. (jb3) (Entered: 10/13/2021)

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  • 10/13/2021
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  • Docket(#8) Pro Hac Vice Letter to Attorney Patrick D. Hedren. (jb3) (Entered: 10/13/2021)

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  • 10/13/2021
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  • Docket(#7) Summons Issued as to Gary Gensler. (jb3) (Entered: 10/13/2021)

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  • 10/13/2021
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  • Docket(#6) Summons Issued as to United States Securities and Exchange Commission. (jb3) (Entered: 10/13/2021)

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  • 10/13/2021

  • DocketCase assigned to Judge David Counts and Judge Ronald C. Griffin. CM WILL NOW REFLECT THE JUDGE INITIALS AS PART OF THE CASE NUMBER. PLEASE APPEND THESE JUDGE INITIALS TO THE CASE NUMBER ON EACH DOCUMENT THAT YOU FILE IN THIS CASE. (jb3) (Entered: 10/13/2021)

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  • 10/13/2021
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  • Docket(#5) RULE 7 DISCLOSURE STATEMENT filed by Natural Gas Services Group, Inc.. (Green, Debbie) (Entered: 10/13/2021)

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  • 10/13/2021
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  • Docket(#4) RULE 7 DISCLOSURE STATEMENT filed by National Association of Manufacturers. (Green, Debbie) (Entered: 10/13/2021)

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  • 10/13/2021
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  • Docket(#3) REQUEST FOR ISSUANCE OF SUMMONS by National Association of Manufacturers, Natural Gas Services Group, Inc.. (Green, Debbie) (Entered: 10/13/2021)

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  • 10/13/2021
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  • Docket(#2) REQUEST FOR ISSUANCE OF SUMMONS by National Association of Manufacturers, Natural Gas Services Group, Inc.. (Green, Debbie) (Entered: 10/13/2021)

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  • 10/13/2021
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  • Docket(#1) COMPLAINT ( Filing fee $ 402 receipt number 0542-15324942), filed by National Association of Manufacturers, Natural Gas Services Group, Inc.. (Attachments: #1 Exhibit A, #2 Exhibit B, #3 Exhibit C, #4 Civil Cover Sheet)(Green, Debbie) (Entered: 10/13/2021)

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