Federal Reserve Board Announces the Second Extension of a Rule to Bolster the Effectiveness of the SBA’s PPP


On February 9, The Federal Reserve Board announced the second extension to a temporary modification of the Board’s rules that allows certain bank directors and shareholders to apply to their banks for Small Business Administration Paycheck Protection Program (PPP) loans for their small businesses. The modification is intended to improve the effectiveness of the PPP. Prior to this modification, limits on the types and quantity of loans that bank directors, shareholders, officers and businesses owned by these persons can receive from their affiliated banks prevented some small business owners from accessing PPP loans. The rule extension is effective immediately and applies to PPP loans made through March 31, 2021. Release.

SEC Adopts Amendments to Modernize Shareholder Proposal Rule


On September 23, the Securities and Exchange Commission (SEC) adopted amendments to modernize the process for a shareholder to have its proposal included in a company’s proxy statement for consideration by all of the company’s shareholders. The amendments aim to ensure that shareholder-proponents demonstrate a sufficient economic stake or investment interest in a company before they are able to submit proposals to be included in a company proxy’s statement, paid for by all shareholders. Release.

Derivative Suit Against Bank of America Alleges Failures in Mortgage Servicing

On July 22, 2011, shareholders of Bank of America sued the corporation and certain of its executives in a derivative suit in the District of Massachusetts, claiming breach of fiduciary duty and violation of certain provisions of the Exchange Act of 1934. The complaint identifies numerous problems Bank of America had encountered in the past few months, including a lawsuit brought against the bank by homeowners and an April 2011 report by the Office of the Comptroller of Currency finding that Bank of America conducted improper servicing, did not maintain adequate internal controls, and lacked sufficient resources to oversee the foreclosure administration process. The complaint alleges that the bank and its executives knew the problems existed but wasted money defending their policies. The complaint seeks restitution from executives, corporate governance changes, and the submission of various proposals for shareholder vote. Complaint.