Yesterday a panel of the D.C. Circuit Court of Appeals held the Conflict Minerals Rules’ requirement that a company that issues stock disclose if its products are not “DRC conflict free” violated the First Amendment.
In an effort to de-finance parties engaged in violence and human-rights abuses related to the extraction of gold, tantalum, tin, and tungsten—so-called “conflict minerals”—from Democratic Republic of the Congo, Congress, through rules promulgated by the Securities Exchange Commission, required companies to disclose not “DRC conflict free” in reports filed with the SEC and on the company’s website if they determine upon due diligence that their products contain such minerals. On appeal of the district court’s ruling in National Association of Manufacturers v. Securities and Exchange Comm’n upholding the law, the Association challenged the SEC’s disclosure requirement as unconstitutionally compelling speech in violation of the First Amendment.
Continue Reading D.C. Circuit Finds Conflicts Minerals Rules’ Disclosure Requirement Unconstitutional; Affirms District Court’s Decisions on De Minimis Exception, Scope of Application, and Due-Diligence Trigger