Professor Hillman Comments on Possible Lehman Brothers Rebuke for Bloomberg
Professor Robert Hillman commented for Bloomberg on the potential for the U.S. Securities and Exchange Commission to issue a rebuke of Lehman Brothers Holdings Inc. rather than sue the company for actions that led to the firm's 2008 failure, the largest bankruptcy in U.S. history. The article also appeared in the San Francisco Chronicle.
Issuing a rebuke, known as a 21(a) report, could help the SEC to fend off critics who say the agency hasn't been aggressive enough in pursuing wrongdoing that led to the financial crisis, yet would not meet the resistance-and possibility of failure-that a suit would entail.
"So much of what went on here was neither clearly legal nor clearly illegal," Professor Hillman said. "It fell through the cracks in this case, and that makes civil actions very, very difficult. The 21(a) report would be an opportunity for the SEC and everyone else to move on."
Robert Hillman is a Professor of Law and holds the Fair Business Practices and Investor Advocacy Chair at UC Davis School of Law. He is a scholar in the fields of international transactions, securities regulation, and corporate and partnership law.