Last Thursday, the U.S. Chamber of Commerce - a business lobby - sued the SEC to overturn a rule that makes it easier for investors to oust corporate directors.  Yesterday, Monday, the SEC responded - saying it's putting on hold new rules that make it easier for shareholders to nominate directors of public companies.

The new rules adopted by the SEC were due to take effect in time for next spring’s elections season for a majority of public U.S. companies.  The rules allow groups that own at least 3% of a company’s stock to put their nominees for board seats on the annual proxy ballot sent to all shareholders.  The changes had been long sought by investor advocates.  Currently, investors must appeal to shareholders at their own expense if they seek new directors on a company’s board or a bylaw change.   [NYT Dealbook, 10/5]

[C-I Note:  We don't know whether:  (i) the SEC "caved under" the lobbyist's pressure;  (ii) the SEC detected flaws in the adopted rule;  or (iii) opposition to the new rule was more widespread than previously anticipated.  In any event, it's interesting to wonder whether this lawsuit can set a precedent. ]