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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Banking and Finance

Date & Time
  • event Date

    Tuesday, November 19, 2024

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

$347.00
CLE
ALL

This CLE webinar will discuss the recent vacation of the SEC's Private Fund Adviser Rules by the U.S. Court of Appeals for the Fifth Circuit. The panel will provide an overview of the Fifth Circuit's decision, examine the impact this decision will have on the private funds industry, and provide guidance on advising private fund advisers on their compliance and reporting obligations going forward.

Faculty

Jaclyn Grodin
Counsel
Goulston & Storrs LLP

Ms. Grodin represents companies, private equity firms, hedge funds, investment advisers, real estate entities, and individuals in a wide range of business disputes including partnership and investor actions, financial fraud cases, securities-related matters, government investigations, trade secret litigations, and intellectual property controversies. Prior to joining the firm, Ms. Grodin spent more than three years as an Assistant Attorney General in the Investor Protection Bureau of the New York State Office of the Attorney General, where she worked on numerous high-profile investigations, including for violations of New York’s Martin Act by investment advisers, asset managers, and broker-dealers as well as law enforcement’s violation of state and federal constitutional rights.

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Marie-Louise M. Huth
Special Counsel
Sullivan & Cromwell

Ms. Huth’s practice focuses on advising investment advisers, private funds, registered funds, broker-dealers, exchanges, clearing agencies, and other financial institutions on a broad range of complex regulatory, compliance, legislative, and enforcement matters. She has a deep understanding of the Investment Company Act of 1940, Investment Advisers Act of 1940, the Securities Exchange Act of 1934, and the Administrative Procedure Act, and her vast experience in the investment management and trading and markets spaces provides a unique insight into current issues in SEC rulemaking, examination, and enforcement contexts. Ms. Huth rejoined the firm in 2023 after having served over 10 years at the SEC in a number of senior leadership positions, most recently as an Associate General Counsel of Legal Policy where she led an office providing legal advice and policy analysis to the Commission, individual Commissioners, and the Commission’s divisions and offices on regulatory recommendations concerning investment advisers, funds, broker-dealers, exchanges, clearing agencies, and other registered entities. 

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Description

On June 5, 2024, the Fifth Circuit in Nat'l Assoc. of Private Fund Mgrs. v. SEC vacated the new Private Fund Adviser Rules adopted by the SEC in August 2023 with a compliance date of September 2024. The rules made significant changes to the business, operations, and practices of private fund advisers and the ruling in this case is considered a big win for the private funds industry.

The rules would have applied to both U.S. and non-U.S. fund managers and they covered fee and expense allocations, general partner clawbacks, preferential treatment, adviser-led secondaries, and reporting. The rules also created a general exception for securitized asset funds.

Although the rules will not go into effect, the principles underlying the rules may continue to impact the private fund industry. For instance, the issues presented in the rules will likely continue to appear in deficiency letters and enforcement proceedings. Also, some investors had already negotiated to receive certain benefits and contractual rights based on the rules in side letters and through other arrangements, and some private fund advisers have adjusted their procedures and market approaches in anticipation of the rules. Counsel advising private fund advisers need to understand the implications of the court's decision and the vacated rules in order to advise their clients on compliance and disclosure practices going forward.

Listen as our authoritative panel discusses the court's decision and the potential lasting impact the vacated rules may have on private fund advisers' internal operations, external reporting, and interactions with fund investors.

Outline

  1. Background and overview of the new Private Fund Adviser Rules
  2. Fifth Circuit decision vacating the rules
  3. Implications of the court's decision and vacation of the rules
  4. Lasting implications of the vacated rules going forward
  5. Compliance and disclosure considerations for private fund advisers going forward
  6. Practitioner takeaways

Benefits

The panel will review these and other key considerations:

  • What were the new reporting and disclosure requirements and restricted/prohibited activities for private fund advisers outlined in the rules?
  • What are the key details and holding from the court's decision?
  • What are the possible next steps for the SEC?
  • What lasting impact will the vacated rules have on the private funds industry?
  • What are next steps and key considerations for advisers when assessing their compliance and disclosure practices going forward?