The business groups have alleged that the SEC “grossly misinterpreted its statutory mandate” in the rule creation process and ended up creating something that violates the First Amendment rights of concerned businesses.
However, according to SEC spokesman John Nester, the SEC believes itself to be legally correct and is reviewing the lawsuit. Nester said, “We believe our legal interpretation and economic analysis are sound and we look forward to defending the rule that Congress directed us to write.”
The businesses challenging the SEC rule is represented in court by attorney Eugene Scalia, the son of Supreme Court Justice Antonin Scalia. Eugene has a history of demolishing SEC regulations including the proxy access rule last year. He is considered an expert in the strengths and weaknesses of the Dodd-Frank Wall Street reform law.
The recent rule by the SEC is meant to combat the practice of bribery on foreign soil by U.S. Energy companies. It became more relevant after U.S. courts, of recent, began to question the merits of the Foreign Corrupt Practices Act, and why issues involving matters not affecting national security or interests, and which take place on foreign soil, are not being litigated in foreign courts, but at the expense in U.S. and at the expense of U.S. taxpayers.
The four business groups challenging SEC’s resource extraction rule include the U.S. Chamber of Commerce, the American Petroleum Institute, the Independent Petroleum Association of America, and the National Foreign Trade Council.