Funds Talk: May 2016

Topics covered in this issue include:

Valuation and Liquidity Management Remain Important Considerations for Hedge Fund Managers 

• A mismatch between a fund’s redemption terms and the liquidity of its underlying investments can have devastating repercussions for the fund, its investors and the manager’s reputation.

Sun Capital Court Decision Adds to ERISA Concerns for Private Equity Funds 

• A recent district court ruling could open up private equity funds to additional liability related to investments in companies with multiemployer pension plan obligations.

SEC, FBI Remind Firms to Ensure They Meet Cybersecurity Obligations 

•  Following public statements from regulators and criminal enforcement agencies alike, firms must continuously review their cyberattack controls and disclosure procedures.

Recent Legal Developments Demonstrate Increasing Accommodation of State Marijuana Regimes

• A pair of recent federal court decisions builds on the foundation of the growing marijuana industry and may demonstrate an added level of flexibility in regard to regulating the sector.

Update on Status of AIFMD Implementation and Passport for Non-EU Funds 

• As the EU regulatory landscape continues to evolve for alternative investment funds, managers must continue to adapt within a patchwork of national regimes.

New Treasury Regulations Make Inversions More Difficult and Alter the Treatment of Debt Instruments Between Related Companies

• The Treasury has been criticized for hindering U.S. companies’ ability to compete globally, and some have questioned whether the Treasury overstepped its authority in issuing the debt recharacterization rules, which represent a major departure from current law.

Summary of Private Fund Panel at SEC Compliance Outreach Program 

• At a recent event, SEC officials highlighted several areas of focus for the SEC's private equity, real estate and hedge fund examination efforts.