By Robert Loesch and Glenn Morrical

In July 2011, in ruling on a petition by The Business Roundtable and the U.S. Chamber of Commerce, the United States D.C. Court of Appeals, struck down an SEC rule that would have required public companies to provide shareholders with information about, and an ability to vote for, shareholder-nominated candidates for boards of directors.

The rule, which was controversial from the beginning, was adopted by the SEC in a 3-2 party line vote in August 2010 . The rule would have permitted a shareholder (or a group of shareholders) who had no intention of seeking a change in control to include a nominee or nominees for election to the board in a company’s proxy materials if the nominating shareholder had continuously held shares equal to at least 3% of the company’s outstanding voting shares for at least three years. The rule would have permitted shareholders to nominate at least one director and up to a number of directors that represents not more than 25% of the total number of the company’s directors.  Read more…