I have been sitting back and learning from the other Masters, but I confess to a far more mundane reaction to the JOBS Act, and one that is far more focused on where I live: what do I need to change in my syllabus for the three credit Securities Regulation course in the fall, and who's providing the resources?
When I was a law student in the 1970s, all discussion of the 34 Act (proxy solicitations, private cause of action, Rule 10-5, etc.) was part of the four credit Business Associations class. Ken Scott's three credit Sec Reg class was entirely based on the 33 Act. So I confess that as somebody who quit being a litigator and moved to transactional work as much more satisfying, my bias is toward teaching the transactional aspects of the field, even though the 34 Act is clearly part of what our school expects us to teach. So I teach 10b-5 litigation and insider trading whether I want to or not.
On the transactional side, while a few of our students might actually work for firms or companies in which the regular reporting requirements are part of the day-to-day work of securities lawyers, I think it's more important for most of our students to understand what triggers the registration requirements under the 33 Act - what is a security, the basic registration and prospectus scheme, the exemptions under Section 4 and Reg D, and the control person and resale gotchas. I had already concluded that the increase in the shareholder numerosity trigger under Section 12 was not all that interesting to me, and that crowdfunding would be a nice little separate unit. But it's the "emerging company on-ramp" stuff - both the "testing the market" and the ensuing reporting exemptions - that has me thinking I am going to have to do some major emendation of the unit on the public offerings.
Does one teach the standard Section 5 IPO process and then "on ramp" as a variant? Is the reality that most IPOs involve companies below the $1 billion annual revenue threshold enough to make the on-ramp the default teaching module? Do we need to wait and see whether companies opt out of the on-ramp? Inquiring minds want to know. Thoughts?
UPDATE: I think my pedagogical conundrum is making the same point as David Zaring's insightful third bullet point in the post just above mine. Do I teach the system or the exception? I kind of thought the system engendered by Section 5 made sense the way it was, and stood the test of time.
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