NASD Vows Rule on Unequal Voting

The National Assn. of Securities Dealers Inc. says it will introduce its own rule to protect corporate stockholders from unequal voting rights if a federal version remains struck down by the courts.

Last week, a federal appeals court in Washington unanimously held that the Securities and Exchange Commission exceeded its authority in prohibiting publicly traded corporations from weakening the voting power of those who already own stock in the company.

The SEC has yet to say if it will appeal the decision by a three-judge panel of the U.S. Circuit Court of Appeals for the District of Columbia.

But Joseph Hardiman, president of the NASD, said if the ruling is upheld “we will propose a look-alike rule.” The NASD is a self-regulating organization overseeing over-the-counter stocks.