In a December 11 letter
to the Securities and Exchange Commission, CII urged the agency to hold fast to its long-established opposition to charter or bylaw provisions requiring arbitration of shareowner disputes. In the letter to Keith Higgins, director of the Division of Corporation Finance, and John Ramsey, acting director of the Division of Trading and Markets, CII expressed concern about recent decisions by the U.S. Supreme Court and the Delaware Court of Chancery that appear to generally support the view that the Federal Arbitration Act requires courts to enforce arbitration provisions that bar class actions with respect to federal and state claims. Often boards add these arbitration provisions to corporate bylaws without shareholder approval. CII's member-approved corporate governance best practices state that companies should not attempt to restrict the venue for shareowner claims by adopting provisions that seek to establish an exclusive forum, or by the introduction of forced arbitration clauses.