MARCH 1, 2007
INVESTMENT MANAGEMENT UPDATE
The Investment Management Practice of
Sidley Austin LLP
Sidley Austin LLP advises clients on a broad range
of investment management issues. The firm
counsels clients with respect to matters involving
the Investment Company Act of 1940 and the
Investment Advisers Act of 1940, and is counsel to
numerous registered investment companies,
private investment entities and their advisers. The
firm regularly represents clients on domestic and
international transactions and regulatory matters
involving investment funds, securities, futures,
options, currencies, swaps and other financial
products.
For further information on this Investment
Management Update, please contact:
Enforcement of Illinois Sudan Act is
Permanently Enjoined
Background. In 2005, the Illinois Sudan Act amended the Illinois Pension Code to
prohibit Illinois pension funds from making investments in Sudan and in companies
doing business in Sudan. Under this amendment, an investment manager with
investment authority over an Illinois pension fund's assets is required to certify that it
has not loaned to, invested in, or otherwise transferred any of the pension fund's assets
to a "forbidden entity" at any time after January 27, 2006. In addition, such an
investment manager is required to certify that as of January 27, 2007, at least 60%, and
as of January 27, 2008, 100% of the Illinois pension fund's are not invested in
"forbidden entities." The definition of "forbidden entity" includes, among others,
Chicago
William D. Kerr
(1) a publicly traded company that has been identified by an independent researching
312.853.2140
firm as a company that owns or controls property or assets located in, has employees
wkerr@sidley.com
Beth J. Dickstein
312.853.6093
bdickstein@sidley.com
or facilities located in, provides goods or services to, issues loans to, or invests in Sudan
or any company domiciled in Sudan, and (2) a non-publicly traded company that fails
to submit an affidavit that avers that the company does not own or control any
property or asset located in Sudan and did not transact business in Sudan.
To receive future copies of this
Investment Management Update via
email, please send your name,
company or firm name and email
address to Diane at dolsen@sidley.com
Court Challenge. On August 7, 2006, the National Foreign Trade Council, Inc.
("NFTC"), joined by eight Illinois state pension boards, brought action in the
Northern District of Illinois against the Illinois State Treasurer and Attorney General
of Illinois, seeking to enjoin enforcement of the Illinois Sudan Act. Among other
This Investment Management Update has been
prepared by Sidley Austin LLP for informational
purposes only and does not constitute legal advice.
This information is not intended to create, and
receipt of it does not constitute, a lawyer-client
relationship. Readers should not act upon this
without seeking advice from professional advisers.
Attorney Advertising - For purposes of compliance with New
York State Bar rules, our headquarters are Sidley Austin
LLP, 787 Seventh Avenue, New York, NY 10019, 212.839.5300
and One South Dearborn, Chicago, IL 60603, 312.853.7000.
Prior results do not guarantee a similar outcome.
things, the NFTC argued that the Illinois Sudan Act violates the U.S. Constitution's
Supremacy Clause because federal law governing investment in Sudan preempts state
law relating to the same matter.
Holding. On February 23, 2007, the court issued its opinion that held, among other
things, that the Illinois Sudan Act's amendment to the Illinois Pension Code is
unconstitutional. It therefore permanently enjoined enforcement of the Illinois Sudan
Act.
INVESTMENT MANAGEMENT UPDATE
PAGE 2
Consequences. As a result of this decision, the Illinois Sudan Act currently is void and unenforceable. In addition, it is possible that
the decision may impact the validity of Sudan investment laws in other states. Nevertheless, the sponsor of the Illinois Sudan Act has
expressed her intent to introduce new legislation prohibiting investment in Sudan that is intended to comply with the rules set forth
in the court decision. Even if any such legislation is enacted, it most likely would be less onerous than the Illinois Sudan Act.
Investment Management Contacts
Chicago
Nathan E. Ballard
James B. Biery
Mark Borrelli
Beth J. Dickstein
Peter Eatherton
Gavin Fearey
D. Justin Griffith
Joseph H. Harrison, Jr.
Bradley D. Howard
Nathan Howell
Lawrence H. Hunt, Jr.
Janelle Ibeling
Zeke Johnson
William D. Kerr
Christopher P. Lokken
James R. McDaniel
Patrick M. Mellon
Bridget R. O’Neill
Gregory J. Robbins
Michele Ilene Ruiz
David R. Sawyier
Elizabeth M. Schubert
Paul L. Seeman
Andrew H. Shaw
Daniel Spies
Jennifer L. Warta
Joshua J. Westerholm
312.853.2667
312.853.7557
312.853.7531
312.853.6093
312.853.4095
312.853.7868
312.853.0727
312.853.7043
312.853.2651
312.853.2655
312.853.7461
312.853.4146
312.853.7514
312.853.2140
312.853.7895
312.853.2665
312.853.2063
312.853.2205
312.853.7249
312.853.7187
312.853.7261
312.853.2935
312.853.4147
312.853.7324
312.853.4167
312.853.0127
312.853.7778
Hong Kong
Laura McIntyre
Carolyn McNabb
Scott D. Peterman
Effie Vasilopoulos
Felicity Wong
852.2509.7870
852.2509.7817
852.2509.7819
852.2509.7860
852.2509.7825
Los Angeles
Sofya Abrams
Gary J. Cohen
John L. Golden
Catherine E. Hutt
213.896.6930
213.896.6013
213.896.6680
213.896.6019
San Francisco
Matthew Anderson
Hannah E. Dunn
415.772.1293
415.772.7458
New York
Kim V. Allman
John Ashbrook
Frank P. Bruno
Victor T.W. Chiu
Stephen Cogut
Benson R. Cohen
J. Gerard Cummins
Caroline M. Dooley
David A. Form
Shelley Howard Grant
Ellen W. Harris
Chiu-Huey Hsia
Brian M. Kaplowitz
David M. Katz
Laurin Blumenthal Kleiman
Stuart S. Koonce
Joyce E. Larson*
Susan D. Lewis
David J. Lestz
John A. MacKinnon
Archana E. Manoharan
Stephanie K. Meth
Jonathan B. Miller
James C. Munsell
Benjamin L. Nager
Patricia V. Norton
212.839.5572
212.839.8744
212.839.5540
212.839.5974
212.839.5841
212.839.7317
212.839.5374
212.839.5637
212.839.5394
212.839.5810
212.839.5583
212.839.8615
212.839.5370
212.839.7386
212.839.5525
212.839.8741
212.839.7326
212.839.5317
212.839.5994
212.839.5534
212.839.5619
212.839.8789
212.839.5385
212.839.5609
212.839.8755
212.839.5671
James O’Connor
Meaghan M. O’Toole
Nadia Persaud
Ann Marie Prevost
Tuuli-Ann Ristkok
Stacy M. Rotner
Michael Sackheim
Michael J. Schmidtberger
Regis Shannahan
Bartholomew A. Sheehan
Benjamin M. Sloman
Thomas R. Smith, Jr.
Carla G. Teodoro
Lawrence C. Tondel
Carol J. Whitesides
Paul R. Wysocki
Michael S. Yadgar
Kevin S. Zadourian
212.839.8613
212.839.5632
212.839.5930
212.839.5408
212.839.8513
212.839.8734
212.839.5503
212.839.5458
212.839.7344
212.839.8652
212.839.5650
212.839.5535
212.839.5969
212.839.5399
212.839.7316
212.839.5303
212.839.7305
212.839.5373
* Compliance Project Specialist
BEIJING BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG LONDON LOS ANGELES NEW YORK SAN FRANCISCO SHANGHAI SINGAPORE TOKYO WASHINGTON, D.C.
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