Login

Login

To access this feature, please Log In or Register for your Casebriefs Account.

Add to Library

Add

Search

Login
Register
Register

In the Matter of Caterpillar, Inc.

Law Dictionary
CASE BRIEFS

Law Dictionary

Featuring Black's Law Dictionary 2nd Ed.
AA
Font size

Business Associations Keyed to Hamilton

View this case and other resources at:
Bloomberg Law

Citation. SEC Rel. No. 34-30532 (Adm. Proceeding File No. 3-7692, 1992)

Brief Fact Summary.

In its annual and quarterly reports, Caterpillar, Inc. Defendant’s failed to sufficiently comply with the disclosure requirements of § 13(a) of the Securities Exchange Act of 1934.

Synopsis of Rule of Law.

Disclosure is required when it is likely that a known trend, demand, commitment, event, or uncertainty is likely to occur, and where such a determination cannot be made, an objective evaluation must be made regarding the consequences of such an occurrence assuming that it will occur.

Facts.

Caterpillar, Inc. (Defendant) had a wholly owned subsidiary, Caterpillar Brasil, S.A. (CBSA), which accounted for approximately one quarter of Defendant’s net profits.  Prior to  Defendant’s filing of the reports required by § 13(a) of the Securities Exchange Act of 1934, management recognized that the future performance of CBSA would be especially hard to predict.  Brazil was volatile, and the impact was significant enough to reduce Defendant’s projected results for 1990.  There was, however, nothing in the reports of the Management Discussion and Analysis (MD & A) to suggest the disproportionate impact of CBSA’s profits on Defendant’s overall profitability or that adequately noted the uncertainty of management regarding CBSA’s performance for 1990.

Issue.

Is disclosure required when it is likely that a known trend, demand, commitment, event, or uncertainty is likely to occur, and where such a determination cannot be made, must an objective evaluation be made regarding the consequences of such an occurrence assuming that it will occur?

Create New Group

Casebriefs is concerned with your security, please complete the following