SpaceX Took a Risk on Mandatory Arbitration, Other IPOs Staying Away

Ryan Adams was quoted in the Law.com article, "SpaceX Took a Risk on Mandatory Arbitration, Other IPOs Staying Away" on the effect of SEC's new policy for IPOs with mandatory arbitration provisions. Newly public companies remain hesitant to adopt mandatory arbitration provisions for shareholder disputes despite the SEC’s decision last year to take a neutral stance on the practice.

Ryan mentioned that companies must balance governance protections against the risk of alienating investors ahead of an IPO. “Mandatory arbitration, I think it’s fair to characterize it as an aggressive position and proxy manager firms do not like it,” he said.

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