Delaware SEC Defense Lawyers

Delaware SEC Defense Lawyers

When companies or individuals in Delaware find themselves under investigation by the Securities and Exchange Commission (SEC), they often seek out experienced defense lawyers to protect their rights and interests. SEC investigations can be complex and stressful, so having strong legal counsel is critical.

In this article, we’ll provide an overview of SEC defense lawyers in Delaware – who they are, services they provide, and key considerations when hiring one. We’ll also discuss some of the common SEC violations they defend against, as well as strategies they use to resolve these cases favorably.

Who are SEC Defense Lawyers in Delaware?

SEC defense lawyers in Delaware are attorneys who specialize in representing clients facing investigations or enforcement actions by the SEC. Many have previous experience working for the SEC themselves, so they understand the agency’s approach and mindset. Others develop expertise through years of handling SEC defense cases in private practice.

Most SEC defense lawyers in Delaware have backgrounds in areas like securities law, corporate law, and white collar defense. They are typically based in Wilmington, which is home to many large corporations and banks that often find themselves dealing with the SEC.

Leading Delaware SEC defense firms include Richards, Layton & Finger; Morris, Nichols, Arsht & Tunnell; and Young Conaway Stargatt & Taylor. These firms have robust securities litigation and regulatory enforcement practices with seasoned attorneys well-versed in SEC defense.

When hiring an SEC defense lawyer in Delaware, it’s important to choose someone with specific experience handling SEC investigations and enforcement actions. Don’t just rely on a general corporate or litigation attorney.

What Services Do SEC Defense Lawyers Provide?

SEC defense lawyers in Delaware offer a wide range of services to clients facing SEC scrutiny, such as:

• Responding to SEC subpoenas and information requests
• Conducting internal investigations to uncover facts
• Negotiating with SEC enforcement staff
• Navigating Wells notice and Wells submissions
• Defending clients in SEC enforcement actions
• Advising clients on SEC compliance going forward

A key service SEC defense lawyers provide is guiding clients through the SEC’s investigative process. This starts with responding to subpoenas for documents and witness testimony. SEC defense lawyers can help clients collect responsive information while protecting privileged materials.

Once the SEC has gathered facts, the next major milestones is when the Enforcement Division issues a Wells notice indicating it intends to recommend charges. SEC defense lawyers handle Wells submissions, which are a client’s chance to tell their side of the story and dissuade enforcement action.

If the SEC ultimately brings an enforcement action, SEC defense lawyers represent clients throughout the litigation process. They can fight to get charges dismissed or reduced, or negotiate a favorable settlement if litigation risks are high.

Common SEC Violations in Delaware

Some of the most common SEC violations that Delaware SEC defense lawyers see include:

• Accounting fraud – Manipulating financial statements and misrepresenting performance.
• Insider trading – Trading securities based on material non-public information.
• Misleading disclosures – False or misleading statements made in SEC filings and press releases.
• FCPA violations – Bribing foreign officials to obtain business overseas.
• Unregistered securities offerings – Selling securities without properly registering with the SEC.

Public companies and financial services firms in Delaware are frequent targets of SEC enforcement. But the SEC also pursues charges against individuals like corporate executives, auditors, and investment advisors.

One high-profile Delaware case involved SEC charges against Wilmington Trust for concealing past due loans amid the financial crisis. Several bank executives were also indicted. Wilmington Trust ended up paying $200 million to settle the SEC action.

SEC Defense Strategies

Experienced SEC defense lawyers employ various strategies to achieve optimal outcomes for clients. Common techniques include:

• Contesting jurisdiction – The SEC may be overstepping its authority, so defense lawyers challenge the legal basis for charges.
• Questioning Wells process – Procedural defects in the Wells notice can invalidate later enforcement actions.
• Cooperation and internal investigation – Uncovering facts first and self-reporting to the SEC can provide leverage in settlement talks.
• Advocacy – Persuasively arguing the client’s case and presenting exculpatory evidence to shift SEC’s view.
• Litigation – Aggressively defending the client in court and seeking dismissal of meritless charges.

An effective SEC defense strategy combines multiple approaches tailored to the unique facts and circumstances of each case.

Key Considerations When Hiring a Delaware SEC Defense Lawyer

If you’re looking to engage an SEC defense lawyer in Delaware, keep the following tips in mind:

• Find someone with specific SEC defense experience, not just general securities or litigation background.
• Understand billing rates and fee structures – SEC cases can be extremely expensive to litigate.
• Ask about experience negotiating Delaware SEC settlements and results achieved for past clients.
• Make sure the lawyer has bandwidth to devote sufficient attention to your case.
• Consider law firms with capabilities to conduct internal investigations if needed.
• Get references from other companies or individuals who hired the lawyer for SEC matters.

The stakes are high in SEC enforcement actions, so take time to carefully vet and choose your SEC defense lawyer in Delaware. Here are some additional considerations when hiring a Delaware SEC defense lawyer:

Understand the Investigation Process

The SEC has a standard process for investigations that typically involves document requests, witness interviews and testimony, Wells notices, and ultimately a decision on enforcement action. SEC defense lawyers who regularly handle these cases will be familiar with the steps and key decision points. This allows them to set client expectations and map out an effective response strategy.

Assess Litigation Experience

If settlement talks fail and the SEC files charges, the matter will proceed to federal court litigation. Not all SEC defense lawyers have extensive litigation experience, so assess their comfort level with bringing cases to trial. Going to court can be risky but sometimes it’s the best option.

Review Track Record

The lawyer should be able to cite examples of past SEC cases they’ve handled, along with concrete results achieved. Ask for specific examples of cases where charges were avoided through effective Wells submissions or favorable settlements negotiated. Beware of vague claims that don’t reference real cases.

Consider Industry Experience

Certain industries like financial services, life sciences and technology tend to attract more SEC scrutiny than others. A lawyer experienced with common issues and violations in your industry can help tailor the defense strategy.

Discuss Resources

SEC cases often require involvement of forensic accountants, investor experts, and other specialists. Understand what resources the lawyer can provide in-house versus needing to engage outside consultants. Who pays for third-party help also needs to be addressed upfront.

Review Malpractice Insurance

Lawyers should carry adequate malpractice coverage in case mistakes are made that negatively impact the defense. Ask about policy limits and insurer ratings to gauge the quality of coverage.

Defending against an SEC investigation is challenging, so take time to find the right legal counsel. They can make all the difference in achieving a successful outcome.