Los Angeles Real Estate Litigation Lawyer Jeffer Mangels & Mitchell LLP Home
Matthew C. Sferrazza, of counsel in the Securities Group with Jeffer Mangels & Mitchell LLP, was recently quoted in the Daily Journal’s Capital & Counsel Newsletter entitled, “Speeding IPOs, Outsourcing Enforcement.” The newsletter covers the SEC’s efforts to boost IPOs, potentially looking to the plaintiffs’ bar to sue companies that stretch the rules and shifting more enforcement responsibility to private shareholder lawsuits.
Sferrazza told the Daily Journal the SEC is planning to take a “lighter touch” to encourage more companies to go public but is not sure if it will boost initial public offerings.
“I think it may shift a little bit of where the bite for being sloppy or actually having potential fraud falls,” he said. “The SEC has relied more on the plaintiffs’ bar for detection and initial prosecution of issues, so they may end up taking that approach.”
“This is prioritizing the facilitation of capital formation a little more, and the tradeoff will be a slight reduction in the SEC’s direct protection of investors,” Sferrazza added.
Sferrazza also said that while high-profile IPOs still will garner plenty of attention and SEC questions, he said the process could be slashed 30 to 60%, shaving a month off for smaller companies and encouraging them to go public instead of selling out to a larger corporation.
“If people hear it’s easier to IPO now, they will consider that instead of a strategic private buyer,” he said.
