Investment Funds & Advisers Insights

The federal Defend Trade Secrets Act (the “DTSA”) became effective on May 11, 2016.  It permits companies to pursue a federal remedy for misappropriation of their trade secrets.  Before the enactment of the DTSA, private rights of action for trade secret misappropriation were governed exclusively by state law.  The DTSA

On June 28, 2016, the SEC proposed new Rule 206(4)-4 and amendments to Rule 204-2 under the Advisers Act that would require SEC-registered investment advisers to establish business continuity and transition plans.   Existing Advisers Act Rule 206(4)-7 requires advisers to adopt formal written compliance policies, and the SEC has previously

The U.S. Securities and Exchange Commission (the “SEC”) has raised the net worth threshold under the “performance fee rule” from $2,000,000 to $2,100,000. This increase, which the SEC announced in Release No. IA-4421, adjusts for inflation the net worth test used to determine whether a client or investor is a

The term “Blue Sky Laws” refers to the laws of U.S. states that prohibit the fraudulent sale of securities. This post is the second in a two-part series on securities and gives a general overview of some of the state securities laws and regulations that may apply to domestic private

Summary. We encourage you to consider obtaining federal trademark protection for the names and logos of your advisory firm and investment funds as part of your overall marketing and intellectual property strategy. We are happy to assist you in this process. Some basic considerations when choosing and protecting a name

Federal and state securities laws and regulations have evolved over time to create a complicated set of rules that apply each time a private investment fund, such as a hedge fund, private equity fund, real estate fund or venture fund, offers or sells interests in that fund. This post is

Welcome to the Insights page for the Investment Funds & Advisers group at Shartsis Friese LLP.   This inaugural post is intended to let you know what you can expect from this page. In our many years practicing in the investment management and private funds space, we have developed a significant amount

This is our annual letter briefly reviewing various issues that our investment adviser clients should consider over the next few weeks. Federally Registered Investment Advisers 1. Annual Updating Amendment to Form ADV. If your firm is an SEC-registered adviser, it must amend its Form ADV each year on the IARD

The U.S. Bureau of Economic Analysis (“BEA”) is conducting the 2014 Benchmark Survey of Financial Services Transactions Between U.S. Financial Services Providers and Foreign Persons.  This survey requires certain U.S. persons to file a Form BE-180 every five years.  This report is not the same as the BE-10 survey that

The U.S. Bureau of Economic Analysis (“BEA”) is conducting the 2014 Benchmark Survey of U.S. Direct Investment Abroad. This survey requires certain U.S. persons to file a Form BE-10. Who Must Report.  A BE-10 report is required of any U.S. person that had direct or indirect ownership or control of at least 10%

A recent enforcement action by the SEC serves as a warning to employers against including confidentiality clauses in employment-related agreements that may restrict employees from reporting violations of the securities laws to the SEC.  Rule 21F-17 of the Dodd Frank Act prohibits any person from taking any action to impede

This is our annual letter briefly reviewing various issues that our investment adviser clients should consider over the next few weeks. Federally Registered Investment Advisers 1. Annual Updating Amendment to Form ADV.  If your firm is an SEC-registered adviser, it must amend its Form ADV each year on the IARD

A recent decision by the Federal Ninth Circuit Court of Appeals, which covers nine Western states, including California, suggests that a business cannot enforce its website’s Terms of Use against users unless they affirmatively agree to those terms.  Website Terms of Use frequently disclose material information and disclaim liability for

On May 12, 2014, the U.S. Commodity Futures Trading Commission (“CFTC”) announced a standardized, streamlined approach for no-action requests relating to delegation of commodity pool operator (“CPO”) activities by an unregistered CPO to a registered CPO.  Delegation typically arises where (1) the general partner of a hedge fund organized as

A. FATCA Requirements Several important deadlines under the U.S. Foreign Account Tax Compliance Act (“FATCA”) are approaching. Advisers to all investment funds, both U.S. and non-U.S., should be aware of the deadlines that apply to their funds. U.S. funds have a new potential withholding obligation and funds formed outside the

On January 7, 2014, the California Commissioner of Business Oversight (the “Commissioner“) adopted a new custody rule (the “Rule“)[1] for investment advisers that are licensed as such in California. The Rule will become effective on April 1, 2014. This letter summarizes key aspects of the Rule for California advisers. 1.

This is our annual letter briefly reviewing various issues that our investment adviser clients should consider over the next few weeks. Federally Registered Investment Advisers 1. Annual Updating Amendment to Form ADV.  If your firm is an SEC-registered adviser, it must amend its Form ADV each year on the IARD

California’s Commissioner of Business Oversight recently issued an order (the “Order”), a copy of which is attached, requiring licensees to register a dedicated email address to receive communications from the Department of Business Oversight (the “DBO”) (formerly called the Department of Corporations).  This Order affects a wide range of financial

Earlier this year the CFTC and the SEC adopted identity theft rules and guidelines (the “Regulations”) that require certain CFTC and SEC regulated entities that offer or maintain accounts that are susceptible to identity theft to implement a red-flags program (a “Program”) designed to detect, prevent and mitigate identity theft.

On July 10, 2013, the SEC adopted rules prohibiting the use of Rule 506 of Regulation D (“Rule 506”) for any securities offering involving certain “bad actors” (the “Rule”).  We addressed the Rule in our letter dated August 2, 2013.  This letter reminds advisers that manage private funds of actions