Headlines about "Stock plans - misc"

Gathered from the web by the editors at BenefitsLink.com.
BofA Investor Lawsuit Wins Class-Action Status
"Investors suing Bank of America Corp won class-action status for their lawsuit accusing the bank of fraudulently misleading them about the 2008 takeover of Merrill Lynch & Co and the size of Merrill's losses and bonus payouts." (Reuters via The New York Times; free registration required)

2nd Circuit Should Rehear 401(k) 'Stock Drop' Cases,DOL Argues in Recent Brief
"Last fall, a divided three-judge panel of the 2nd Circuit ruled that fiduciary decisions to offer company stock as a 401(k) investment option are entitled to a presumption of prudence and should be reviewed only for an abuse of discretion ? not held to a stricter standard. Though the so-called 'Moench presumption' has been adopted by five appeals courts, it finds no support in ERISA and 'leads to absurd results,' DOL asserts." (Mercer)

ISS Issues FAQs on 2012 U.S. Voting Policies
"A new set of [FAQs] from Institutional Shareholder Services . . . clarifies its 2012 proxy-voting guidelines on pay-for-performance assessments, say-on-pay responsiveness and equity plans. The FAQs supplement ISS's white paper explaining the proxy adviser's quantitative and qualitative approach to identifying pay-for-performance disconnects. The updated guidelines apply for shareholder meetings on or after Feb. 1." (Mercer)

The State of Broad-Based Employee Ownership Plans 2012
This report details the extent and growth of employee ownership through ESOPs, 401(k) plans, stock options, ESPPs, and other vehicles; summarizes the leading research on employee ownership and corporate performance; and discusses current challenges and prospects. (National Center for Employee Ownership)

[Guidance Overview] In Re: Citigroup ERISA Litigation: Has The Death Knell Sounded for Stock Drop Cases?
"[The Court of Appeals for the Second Circuit] was not simply being asked to articulate the standard of review applicable to ERISA fiduciary conduct in the context of stock drop claims, but also to determine the pleading requirements sufficient to allow such complaints to proceed. . . . The decision is very favorable to the employer-fiduciary community." (The Metropolitan Corporate Counsel)

Using Employer Stock in Qualified Plans
"Unfortunately, in the worst of times, employer stock can be the focus of extra scrutiny, and even litigation, if plan fiduciaries aren't conscientious about fulfilling their fiduciary duty. The troubled economic conditions and turbulent markets of the past few years have generated a surge in lawsuits against plan fiduciaries when employer stock has dropped precipitously." (Investment News; free registration required)

2012 U.S. Proxy Voting Summary Guidelines (PDF)
"ISS' Benchmark proxy voting guidelines serve as a tool to assist institutional investors in meeting their fiduciary requirements with respect to voting by promoting shareholder value creation and risk mitigation at their portfolio firms." (Institutional Shareholder Services Inc.)

Results from the NCEO Private Company Equity Compensation Survey
In this featured article from the Employee Ownership Report (available through mid-February 2012, when it will be replaced by another excerpt), the NCEO discusses the results of its private company equity compensation survey. (National Center for Employee Ownership)

[Guidance Overview] ISS Issues Technical Paper on Evaluating Pay for Performance and Updated Burn Rate Tables (PDF)
"Under its Burn Rate Policy, ISS recommends against stock plan proposals if a company's three-year average burn rate exceeds its industry group's mean by more than one standard deviation or two percent of weighted common shares outstanding, if higher." (Frederic W. Cook & Co., Inc.)

[Guidance Overview] Second Circuit Adopts Presumption of Prudence for Holding of Employer Stock; Determines Fiduciaries Have No Affirmative Duty to Disclose Adverse Information
"In these decisions, the Second Circuit joins the Third, Fifth, Sixth and Ninth Circuits in adopting a presumption of prudence for the holding of employer stock in plans designed to hold such stock; to date, no circuit court has rejected this presumption." (Goodwin Procter LLP)

Ten Ideas for Year-End Tax Planning with Stock Compensation
"As part of your year-end and year-beginning tax planning, review your stock options and company stock holdings. Make investment objectives and personal financial needs, not tax considerations, the driver of your decisions. Here are 10 ideas to review before the end of the year to make sure you aren't paying more taxes than necessary." (myStockPlan.com, Inc.)

Walmart and Merrill Lynch Agree To Pay $13.5 Million To Settle 401(k) Fiduciary Lawsuit
"In papers filed in Kansas City federal court, the two corporate defendants admitted no wrongdoing. But Wal-Mart said it would 'further its goal to offer investment options with fees that are reasonable,' remove mutual funds that charge high fees and provide more financial education to employees." (Forbes.com LLC)

[Guidance Overview] Presumption of Prudence Shields Fiduciaries from Liability Following Decline in Value of Employer Stock
"Plan participants alleged that plan fiduciaries breached ERISA duties of prudence and loyalty by refusing to divest the plans of company stock, even though its exposure to the imploding subprime securities market made it an imprudent investment option." (Wolters Kluwer Law & Business / CCH)

[Guidance Overview] Equity Arrangements and Change in Control Agreements
"Young was a split decision, 2 to 1. A vigorous dissent concluded that the unambiguous terms of the plan made clear that the executive had good reason to resign in February 2009, and that the compensation committee's reading of the plan was based on an interpretation that was contrary to the plan's unambiguous terms and therefore arbitrary under New York law." (National Association of Stock Plan Professionals via Utz, Miller & Eickman, LLC)

[Guidance Overview] Another Circuit Court Adopts Presumption of Prudence for Investments in Employer Stock
"These two appeals were decided by a panel of three judges, one of whom mounted a vigorous dissent, finding the 'underpinnings of the Moench presumption to be fundamentally unsound.' The dissenting judge argued that public policy does not warrant a deferential standard of review for investment decisions made with respect to employer stock." (Thomson Reuters/EBIA)

Stock Ownership Guidelines Hard-Wired Into the Plan?
"I wanted to point out to readers a company that recently incorporated its stock ownership guidelines into its stock incentive plan document, which I had not seen previously. The amended Motricity, Inc. 2010 Long Term Incentive Plan, approved by stockholders on October 28, 2011, contains the following paragraph . . . ." (Michael S. Melbinger via Winston & Strawn LLP)

The Pension Protection Act of 2006 and Diversification of Employer Stock in Defined Contribution Plans
"This paper estimates the short-run impact of the Pension Protection Act of 2006 . . . on holdings of employer stock in defined contribution pension plans." (Center for Retirement Research at Boston College)

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