USA: Companies respond to lawsuit against SEC over final rule accompanying section 1502 of Dodd-Frank Act
On 22 August 2012 the US Securities and Exchange Commission (SEC) issued the final rule accompanying Section 1502 of the Dodd-Frank Act. See our coverage of reactions to the SEC vote to adopt this rule.
The rule requires companies using gold, tin, tungsten and tantalum to make efforts to determine if those materials came from the Democratic Republic of Congo (DRC) or an adjoining country and, if so, to carry out supply chain due diligence to determine whether their mineral purchases are funding armed groups in eastern DRC. It also requires companies to report publicly on their due diligence and to have their reports independently audited. Business groups argue the rule is burdensome, costly and ineffective.
In October 2012 the US Chamber of Commerce, the National Association of Manufacturers (NAM) and the Business Roundtable filed a lawsuit against SEC asking for the rule to be modified or set aside in whole or in part. Media coverage of the lawsuit included:
- Business Groups Sue to Block “Conflict Minerals” Rules, C.M. Matthews, Wall Street Journal, 22 Oct 2012
- SEC Sued Over ‘Conflict Minerals’ Rule by Business Groups, Andrew Harris, Bloomberg, 22 Oct 2012
- Gutless companies launch lawsuit to avoid coming clean on conflict minerals, Global Witness, 24 Oct 2012
In November 2012 we invited the companies listed below to respond to an article by Global Witness, “Companies must take clear position on legal threat to Conflict Minerals Provision”
This article calls on the companies to issue a public statement outlining their position on the lawsuit and particularly whether they are formally backing the lawsuit.
Acer response [DOC]
AMD referred us to a multi-stakeholder group statementon which they are a signatory
AT&T response [DOC]
Boeing did not respond
Dell referred us to a multi-stakeholder group statement on which they are a signatory
Ford response [DOC]
General Electric referred us to a multi-stakeholder group statement on which they are a signatory
Honda response [PDF]
HP referred us to a multi-stakeholder group statement on which they are a signatory
Intel referred us to a multi-stakeholder group statement on which they are a signatory
Kemet response [DOC]
Microsoft referred us to a multi-stakeholder group statement on which they are a signatory
Motorola Solutions response [DOC]
Panasonic referred us to their earlier statement to us saying this still represents their position
Research in Motion (RIM) declined to respond
Xerox response [PDF]
Global Witness issues new call for more companies to "come clean" on conflict minerals lawsuit - 10 Dec 2012
In December we invited the companies below to respond to a statement by Global Witness, "Companies must come clean on conflict minerals lawsuit".
This statement calls for the companies named to issue a public statement clearly outlining the their position in relation to the lawsuit, and encourage the Chamber of Commerce, NAM and the Business Roundtable to immediately withdraw their suit over Section 1502. Global Witness states that these companies are members of the US Chamber of Commerce, NAM or the Business Roundtable, and have lobbied the SEC on the content of the final rule.
Abbott Labs did not respond
Boeing referred us to a statement to the SEC from Oct 2011
Caterpillar said that NAM would respond on its behalf
Deere & Company response [PDF]
Emerson Electric declined to respond
Honda referred us to their previous statement from Nov 2012
Honeywell response [DOC]
Kennametal did not respond
Lockheed Martin declined to respond
Northrop Grumman declined to respond
NUCOR did not respond
Rockwell Automation did not respond
Rockwell Collins declined to respond
Schneider Electric did not respond
Siemens did not respond
Thermo Fisher Scientific declined to respond
Toyota Motor declined to respond
United Technologies Corporation did not respond
Whirlpool declined to respond and referred us to NAM
Xerox response [DOC]
In January 2013 we also invited NAM to respond to the criticisms raised in the Global Witness 10 December press release. NAM sent us a joint statement from themselves and the other parties bringing the lawsuit, the US Chamber of Commerce and the Business Roundtable.
See here for our coverage of commentaries, tools & guidance, and company actions to implement the rule
Positions of companies & business groups during rule-making process
During the SEC's process of adopting its rules on conflict minerals, Global Witness and other NGOs also raised concerns about some business groups' opposition to the proposed regulations. Global Witness asked, "Are electronics companies trying to have it both ways on conflict minerals legislation?" Business & Human Rights Resource Centre sought responses from the companies and business organizations named by Global Witness & other NGOs - available here.