The due date for the next Form SD filing for those public companies required to report to the Securities and Exchange Commission (“SEC”) on the inclusion of conflict minerals in their products is May 31, 2016.
In response to a challenge of the SEC conflict minerals rule by a coalition of trade associations, the Court of Appeals for the D.C. Circuit issued an opinion in April 2014. That opinion upheld parts of the rule, but also effectively struck down on First Amendment grounds the portion of the rule that required companies to describe their products as “DRC Conflict Free,” “DRC conflict undeterminable” or “not found to be ‘DRC Conflict Free,’ ” as the case may be. On rehearing in August 2015, the D.C. Circuit reaffirmed its April 2014 decision. The D.C. Circuit then denied an SEC and NGO’s petition for rehearing en banc the following November. Finally, in March 2016, Attorney General Loretta Lynch notified Congress that the federal government would not petition for a writ of certiorari to the Supreme Court. The deadline to file the petition passed in April. Thus, the appellate process has been exhausted.
The next procedural step in the case is remand back to the district court for further proceedings consistent with the D.C. Circuit holding. Those proceedings are likely to consider whether the First Amendment violation applies solely to the SEC rule or also Section 1502 of the Dodd-Frank Act. Depending on how the district court ultimately rules, the SEC may be required to rewrite some or all of the conflict minerals rule. Until the district court rules, however, public companies should continue to take steps to file their next Form SD by May 31.