60738 Federal Register / Vol. 73, No. 199 / Tuesday, October 14, 2008 / Notices 

1H.R. 1424. 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 34– 

57525 (March 18, 2008); 73 FR 15815–15817 (March 

25, 2008) (notice). 

4The following submitted comment letters: 

Steven B. Caruso, Maddox Hargett & Caruso, P.C. 

(March 21, 2008) (‘‘Caruso letter’’); Jeff Sonn, Sonn, 

Erez, PLC (March 26, 2008) (‘‘Sonn letter’’); Seth E. 

Lipner, Professor of Law, Zicklin School of 

Business, Baruch College, CUNY, Member, Deutsch 

Lipner (March 28, 2008) (‘‘Lipner letter’’); Steve 

Buchwalter, Attorney (March 29, 2008 and May 15, 

2008) (‘‘Buchwalter letters’’); William A. Jacobson, 

Associate Clinical Professor, Director, Cornell 

Securities Law Clinic, Cornell Law School (March 

31, 2008) (‘‘Cornell letter’’); Scott R. Shewan, Born, 

Pape & Shewan, LLP (April 1, 2008) (‘‘Shewan 

letter’’); Barry D. Estell, Attorney (April 9, 2008) 

(‘‘Estell letter’’); Timothy Canning, Canning & 

Associates (April 10, 2008); Joseph Fogel, Fogel 

Associates (April 11, 2008) (‘‘Fogel letter’’); David 

P. Neuman, Stoltmann Law Offices, P.C. (April 14, 

2008) (‘‘Neuman letter’’); Debra B. Hayes, Attorney 

(April 15, 2008) (‘‘Hayes letter’’); Karen Tyler, 

President, North American Securities 

Administrators Association (‘‘NASAA’’), Inc., and 

North Dakota Securities Commissioner (April 17, 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/other.shtml); or 

• Send an e-mail message to rulecomments@sec.gov. Please include File 

Number 4–573 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Florence E. Harmon, Acting 

Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

No. 4–573. This file number should be 

included on the subject line if e-mail is 

used. To help us process and review 

your comments more efficiently, please 

use only one method. The Commission 

will post all comments on its Internet 

Web site (http://www.sec.gov/rules/ 

other.shtml). Comments are also 

available for public inspection and 

copying in the Commission’s Public 

Reference Room, 100 F Street, NE., 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. All comments received 

will be posted without change; we do 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. 

FOR FURTHER INFORMATION CONTACT: 

Jenifer Minke-Girard, Senior Associate 

Chief Accountant, at (202) 551–5300, 

Office of the Chief Accountant, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–6561. 

SUPPLEMENTARY INFORMATION: In 

connection with the study to be 

conducted by the Securities and 

Exchange Commission (‘‘Commission’’) 

under the Emergency Economic 

Stabilization Act of 2008 (the ‘‘Act’’) 1 of 

‘‘mark-to-market’’ accounting applicable 

to financial institutions, including 

depository institutions, the Commission 

welcomes public comments on the 

issues, point-of-view, research and 

opinions that the Commission’s staff 

should consider in conducting the 

study. 

The Act, which was enacted and 

signed by the President on October 3, 

2008, requires the Commission to 

conduct a study of ‘‘mark-to-market’’ 

accounting and submit a report to 

Congress with the findings and 

determinations within 90 days. 

Specifically Section 133 of the Act 

provides as follows: 

Study on Mark-to-Market Accounting 

(a) STUDY.—The Securities and 

Exchange Commission, in consultation 

with the Board [of Governors of the 

Federal Reserve System] and the 

Secretary [of the Treasury], shall 

conduct a study on mark-to-market 

accounting standards as provided in 

Statement Number 157 of the Financial 

Accounting Standards Board, as such 

standards are applicable to financial 

institutions, including depository 

institutions. Such a study shall consider 

at a minimum— 

(1) The effects of such accounting 

standards on a financial institution’s 

balance sheet; 

(2) The impacts of such accounting on 

bank failures in 2008; 

(3) The impact of such standards on 

the quality of financial information 

available to investors; 

(4) The process used by the Financial 

Accounting Standards Board in 

developing accounting standards; 

(5) The advisability and feasibility of 

modifications to such standards; and 

(6) Alternative accounting standards 

to those provided in such Statement 

Number 157. 

(b) REPORT.—The Securities and 

Exchange Commission shall submit to 

Congress a report of such study before 

the end of the 90-day period beginning 

on the date of the enactment of this Act 

containing the findings and 

determinations of the Commission, 

including such administrative and 

legislative recommendations as the 

Commission determines appropriate. 

All interested parties are invited to 

submit their views, in writing, on any or 

all of the subjects identified, whether 

subjects in addition to those identified 

should be included in the study for any 

reason or on any other matter relating to 

the current use of fair value accounting 

(including mark-to-market) in the U.S. 

financial reporting system that should 

be considered. 

Dated: October 8, 2008. 

By the Commission. 

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–24245 Filed 10–10–08; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58739; File No. SR–FINRA– 

2008–005] 

Self-Regulatory Organizations: 

Financial Industry Regulatory 

Authority, Inc.; Notice of Filing of 

Amendment No. 1 and Order Granting 

Accelerated Approval of Proposed 

Rule Change as Modified by 

Amendment No. 1 Thereto To Adopt 

Rule 12905 of the Code of Arbitration 

Procedure for Customer Disputes and 

Rule 13905 of the Code of Arbitration 

Procedure for Industry Disputes To 

Permit Submissions Under Limited 

Circumstances to Arbitrators After a 

Case Has Closed 

October 6, 2008. 

I. Introduction 

On February 7, 2008, the Financial 

Industry Regulatory Authority, Inc. 

(‘‘FINRA’’) (f/k/a/ National Association 

of Securities Dealers, Inc. (‘‘NASD’’)) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) pursuant 

to Section 19(b)(1) of the Securities 

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 a proposed rule 

change to amend the NASD Code of 

Arbitration Procedure for Customer 

Disputes (‘‘Customer Code’’) and the 

NASD Code of Arbitration Procedure for 

Industry Disputes (‘‘Industry Code’’) to 

permit submissions to arbitrators after a 

case has closed only under limited, 

enumerated circumstances. The 

proposed rule change was published for 

comment in the Federal Register on 

March 18, 2008.3 The Commission 

received 13 comment letters in response 

to the proposed rule change.4 On June 


jlentini on PROD1PC65 with NOTICES
Federal Register / Vol. 73, No. 199 / Tuesday, October 14, 2008 / Notices 60739 

2008) (‘‘NASAA letter’’); and Laurence S. Schultz, 

President, Public Investors Arbitration Bar 

Association (‘‘PIABA’’) (April 18, 2008) (‘‘PIABA 

letter’’). 

5See Letter from Margo A. Hassan, Counsel, 

FINRA, to Florence E. Harmon, Deputy Secretary, 

Commission (June 19, 2008). 

6The Director, as defined in Rule 12100 of the 

Customer Code and Rule 13100 of the Industry 

Code, will forward documents submitted pursuant 

to this circumstance, along with any responses from 

parties, to the arbitrators. 

7Unilateral requests to reopen closed cases for 

expungement relief would not be permitted 

(Conversation between Margo A. Hassan, Counsel, 

FINRA and Lourdes Gonzalez, Assistant Chief 

Counsel—Sales Practices, Office of Chief Counsel of 

the Division of Trading and Markets, U.S. Securities 

and Exchange Commission on July 10, 2008). 

8See supra, note 4. 9See Caruso, Sonn, Buchwalter (March 29, 2008 

and May 15, 2008), Cornell, Shewan, Estell, Fogel, 

Neuman, Hayes, NASAA and PIABA letters. 

10See Lipner letter. 

11See, e.g., Caruso, Sonn, Cornell, Shewan, Estell, 

Hayes, NASAA and PIABA letters. 

12See, e.g., Buchwalter, Cornell, Shewan, Estell, 

Fogel, Neuman, Hayes and PIABA letters. 

13See, e.g., Estell, NASAA and PIABA letters. 

14See, e.g., Lipner and Cornell letters. 

15See, e.g., Buchwalter, Cornell, Estell, Hayes, 

Shewan, NASAA and PIABA letters. 

16See, e.g., Cornell, Estell and PIABA letters. 

17See, e.g., Cornell, Shewan, NASAA and PIABA 

letters. 

18See supra, note 5. 

19 Id. 

19, 2008, FINRA responded to the 

comment letters 5 and submitted 

Amendment 1 to the proposed rule 

change. This order provides notice of 

the proposed rule change, as modified 

by Amendment No. 1, and approves the 

proposed rule change as amended on an 

accelerated basis. 

II. Description of the Proposed Rule 

Change 

FINRA initially proposed to adopt 

Rule 12905 of the Customer Code and 

Rule 13905 of the Industry Code to 

permit submissions to arbitrators after a 

case has closed only under the 

following circumstances: (1) As ordered 

by a court; (2) at the request of any party 

within 30 days of service of an award or 

notice that a matter has been closed, for 

ministerial matters; or (3) if all parties 

agree and submit documents within 30 

days of service of an award or notice 

that a matter has been closed. 

After reviewing the comments, FINRA 

amended its proposed rule change on 

June 19, 2008, so that submissions to 

arbitrators after a case has closed would 

only be permitted under the following 

circumstances: (1) As ordered by a 

court; 6 (2) at the request of any party 

within 10 days of service of an award or 

notice that a matter has been closed, for 

typographical or computational errors or 

mistakes in the description of any 

person or property referred to in the 

award; or (3) if all parties agree and 

submit documents within 10 days of 

service of an award or notice that a 

matter has been closed.7 If the Director 

determines submissions made pursuant 

to circumstances (2) and (3) comply 

with the grounds for submission, the 

proposed rules would require the 

Director to forward the submissions, 

along with any responses from the 

parties, to the arbitrators. The arbitrators 

have the discretion under the proposed 

rules to decline the requests made 

pursuant to circumstances (2) and (3). 

Under the proposed rules, the requests 

would be considered denied unless the 

arbitrators rule within 10 days after the 

Director forwards the documents. The 

proposed rules would not allow any 

requests to extend the time period for 

the payment of any award pursuant to 

Rule 12904 for customer disputes or to 

Rule 13904 for industry disputes. 

III. Summary of Comments Received 

and FINRA Response 

As noted above, the Commission 

received 13 comment letters on the 

proposed rules.8 Twelve commenters 

opposed the proposal; 9 one commenter 

supported the proposal but urged 

FINRA to make clear that the time 

period to pay an award would not be 

extended by the proposed rule change.10

A number of commenters argued that 

the term ‘‘ministerial matters’’ lacked 

specificity and requested further 

clarification.11 Others predicted that 

permitting unilateral motions relating to 

ministerial matters would increase 

litigation costs for parties and that the 

rules would delay award payments.12

Several commenters maintained that the 

rules would allow expungement to be 

accomplished without any outside 

oversight.13 Other commenters 

suggested that the rule change should 

not allow a member or associated 

person to extend the 30-day period for 

payment of award.14 A number of 

commenters stated that the proposed 

rule conflicts with the policy of finality 

in arbitration.15 Several commenters 

argued that it is against the public 

interest to allow a party to raise an issue 

it did not raise during the hearing.16

In response to the comments, on June 

19, 2008, FINRA filed Amendment No. 

1 to the proposed rule change to address 

potential ambiguities in the rules and 

further limit the circumstances under 

which a party may make a request under 

the rules. In particular, FINRA proposed 

to shorten the time limit for requests 

made by the parties from 30 to 10 days 

to expedite requests under the rules and 

to avoid delays in award payments. 

FINRA also proposed to clarify that 

such a request would not extend the 

time period for paying an award. In 

addition, FINRA proposed to clarify the 

scope of the term ‘‘ministerial matters’’ 

by limiting the grounds for unilateral 

requests to typographical or 

computational errors, such as an 

addition mistake when computing 

forum fees, or to mistakes in the 

description of a person or property, 

such as an incorrect reference to the title 

of an account in an award. 

Several commenters questioned 

whether there is sufficient need for the 

proposed rules given what they view as 

the limited number of requests to permit 

submissions to arbitrators after a case 

has closed.17 FINRA responded that it 

receives an estimated 150 or more such 

requests per year, which is a significant 

number in FINRA’s view.18 FINRA also 

stated that it believes the proposal 

would add transparency to the forum’s 

process for considering such requests.19

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing 

Amendment, including whether the 

proposed rule change is consistent with 

the Act. Comments may be submitted by 

any of the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–FINRA–2008–005 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–FINRA–2008–005. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, Amendment No. 1, all 

written statements with respect to the 

proposed rule change that are filed with 

the Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 


jlentini on PROD1PC65 with NOTICES
60740 Federal Register / Vol. 73, No. 199 / Tuesday, October 14, 2008 / Notices 

20 In approving this proposal, the Commission has 

considered the proposed rule’s impact on 

efficiency, competition and capital formation. See 

15 U.S.C. 78c(f). 

21 15 U.S.C. 78s(b)(2). 

22 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3Premium Products is defined in the Schedule of 

Fees as the products enumerated therein. 

4 iShares is a registered trademark of Barclays 

Global Investors, N.A. (‘‘BGI’’), a wholly owned 

subsidiary of Barclays Bank PLC. ‘‘Dow Jones’’ and 

‘‘Dow Jones U.S. Oil Equipment & Services Index’’ 

are trademarks and service marks of Dow Jones & 

Company, Inc. (‘‘Dow Jones’’) and have been 

licensed for use for certain purposes by BGI. All 

other trademarks and service marks are the property 

of their respective owners. The iShares Dow Jones 

U.S. Oil Equipment & Services Index Fund (‘‘IEZ’’) 

is not sponsored, endorsed, or promoted by Dow 

Jones. BGI and Dow Jones have not licensed or 

authorized ISE to (i) engage in the creation, listing, 

provision of a market for trading, marketing, and 

promotion of options on IEZ or (ii) to use and refer 

to any of their trademarks or service marks in 

connection with the listing, provision of a market 

for trading, marketing, and promotion of options on 

IEZ or with making disclosures concerning options 

on IEZ under any applicable federal or state laws, 

rules or regulations. BGI and Dow Jones do not 

sponsor, endorse, or promote such activity by ISE, 

and are not affiliated in any manner with ISE. 

5 Vanguard, Vanguard ETFs and Vanguard ETF 

are trademarks of The Vanguard Group, Inc. 

(‘‘Vanguard’’). All other marks are the exclusive 

property of their respective owners. The Vanguard

Information Technology ETF (‘‘VGT’’) tracks the 

Morgan Stanley Capital International (MSCI) U.S. 

Investable Market Information Technology Index. 

MSCI does not sponsor, endorse, or promote VGT 

and makes no representation regarding the 

advisability of investing in VGT. Vanguard and 

MSCI have not licensed or authorized ISE to (i) 

engage in the creation, listing, provision of a market 

for trading, marketing, and promotion of options on 

VGT or (ii) to use and refer to any of their 

trademarks or service marks in connection with the 

listing, provision of a market for trading, marketing, 

and promotion of options on VGT or with making 

disclosures concerning options on VGT under any 

applicable federal or state laws, rules or regulations. 

Vanguard and MSCI do not sponsor, endorse, or 

promote such activity by ISE, and are not affiliated 

in any manner with ISE. 

6 Vanguard, Vanguard ETFs and Vanguard ETF 

are trademarks of The Vanguard Group, Inc. 

(‘‘Vanguard’’). All other marks are the exclusive 

property of their respective owners. The Vanguard

Mid-Cap ETF (‘‘VO’’) tracks the Morgan Stanley 

Capital International (MSCI) U.S. Mid Cap 450 

Index. MSCI does not sponsor, endorse, or promote 

VO and makes no representation regarding the 

advisability of investing in VO. Vanguard and MSCI 

have not licensed or authorized ISE to (i) engage in 

the creation, listing, provision of a market for 

trading, marketing, and promotion of options on VO 

or (ii) to use and refer to any of their trademarks 

or service marks in connection with the listing, 

provision of a market for trading, marketing, and 

promotion of options on VO or with making 

disclosures concerning options on VO under any 

applicable federal or state laws, rules or regulations. 

Vanguard and MSCI do not sponsor, endorse, or 

promote such activity by ISE, and are not affiliated 

in any manner with ISE. 

available for inspection and copying in 

the Commission’s Public Reference 

Room, on official business days between 

the hours of 10 a.m. and 3 p.m. Copies 

of the filing also will be available for 

inspection and copying at the principal 

office of FINRA. All comments received 

will be posted without change; the 

Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–FINRA– 

2008–005 and should be submitted on 

or before November 4, 2008. 

V. Discussion and Findings 

After careful review, the Commission 

finds that the proposed rule change, as 

amended, is consistent with the 

requirements of the Act, and the rules 

and regulations thereunder that are 

applicable to a national securities 

association.20 In particular, the 

Commission finds that the proposed 

rule change, as amended, is consistent 

with the provisions of Section 15A(b)(6) 

of the Act, which provides that the rules 

of a national securities association 

should be designed ‘‘in general, to 

protect investors and the public 

interest[.]’’ The Commission concludes 

that the proposed rule change would 

strictly limit the circumstances under 

which a party would be permitted to 

submit documents to arbitrators in 

closed cases, add transparency to the 

process for considering such requests 

and support a fair arbitration process. 

The Commission finds that it is in the 

public interest to approve the proposed 

rule change as soon as possible to 

expedite its implementation. 

Accordingly, the Commission believes 

good cause exists, consistent with 

Sections 6(b)(5) and 19(b)(2) of the Act 

to approve on an accelerated basis the 

proposed rule change as modified by 

Amendment No. 1. 

VI. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,21 that the 

proposed rule change (SR–FINRA– 

2008–005), as modified by Amendment 

No. 1 thereto, be, and hereby is, 

approved on an accelerated basis. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.22

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–24241 Filed 10–10–08; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58744; File No. SR–ISE– 

2008–76] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change Relating to Fee Changes 

October 7, 2008. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on October 

3, 2008, the International Securities 

Exchange, LLC (‘‘ISE’’ or ‘‘Exchange’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been prepared by the selfregulatory organization. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested parties. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The ISE is proposing to amend its 

Schedule of Fees to establish fees for 

transactions in options on 5 Premium 

Products.3 The text of the proposed rule 

change is available at the Exchange. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization has 

prepared summaries, set forth in 

Sections A, B, and C below, of the most 

significant aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange is proposing to amend 

its Schedule of Fees to establish fees for 

transactions in options on the iShares 

Dow Jones U.S. Oil Equipment & 

Services Index Fund (‘‘IEZ’’),4 the 

Vanguard Information Technology ETF 

(‘‘VGT’’),5 the Vanguard Mid-Cap ETF 

(‘‘VO’’),6 the SPDR S&P Biotech ETF 


jlentini on PROD1PC65 with NOTICES