Just checking in on NCPPR v. SEC, which I previously blogged about here.

In that case, the SEC issued Kroger a no-action letter allowing it to exclude a conservative shareholder proposal from its proxy materials.  The shareholders sued, claiming that the SEC had engaged in unconstitutional viewpoint discrimination against conservatives; meanwhile, intervenors National Association of Manufacturers argued that Rule 14a-8 itself was unconstitutional.  The SEC argued that its no-action decisions are not final orders subject to review.

A Dem-majority panel held that the issue was moot – not because the meeting date had passed, but because Kroger had voluntarily agreed to include the proposal in its materials, and the shareholders had soundly rejected it, which meant that should NCPPR seek to advance the proposal again in the near future, it would be excludable for failure to meet resubmission thresholds.  But the panel also held that no-action letters are not final orders and cannot be reviewed.

Judge Jones dissented on both points, and further wrote that she would have reversed the no-action decision on the ground that the SEC had engaged in viewpoint discrimination.  Since the Fifth Circuit tends to holistically lean more toward Jones than toward the Democrats, I thought en banc review was a realistic possibility.

But apparently not!  The court rejected the petition.  But at the same time, the panel revised its opinion to exclude the bit about no-action letters being unreviewable; now, the decision rests solely on mootness, and the original panel decision has been disappeared.  (For nostalgia purposes, I uploaded it here).

So I can’t help but suspect that these two events are linked; i.e., that there is some appetite at the Fifth Circuit for an en banc consideration of whether no-action letters are reviewable, but not in this particular case, so long as the panel decision (which is unpublished) solely addresses mootness.

Which means we could see movement on this at some point, though with the SEC now acting under a conservative administration – and hostile to shareholder proposals generally – the politics of it are a lot more complicated than they were under Biden. (Notably, the Trump administration opposed rehearing en banc and maintained the view that no-action letters cannot be reviewed).

And another thing. On this week’s Shareholder Primacy podcast, Mike Levin and I talk about earnout disputes, and the latest Glass Lewis dustup. Here at Apple, here at Spotify, and here at YouTube.