Sullivan
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Sullivan’s interdisciplinary team combines market-leading capital markets, regulatory and enforcement experience to guide clients through FINRA’s evolving oversight of small-cap offerings and foreign issuer activity, as well as broader regulatory developments impacting small-cap, micro-cap and mid-market market participants.

In response to FINRA’s targeted review of small-cap IPOs and related offerings, Sullivan & Worcester has formed a Small-Firm Task Force to help clients navigate the immediate inquiry and the evolving regulatory landscape. The Task Force unites the firm’s Capital Markets, Regulatory Compliance, Government Investigations and Financial Services Litigation practices, each with deep experience advising issuers, broker-dealers, investment funds and institutional investors operating in the small-cap, micro-cap and mid-market segments.

As the challenges continue to mount for issuers, broker-dealers, and investment firms that are involved in the small- and micro-cap market segments and regulatory scrutiny continues to multiply, the Task Force has broadened its focus to related SEC rulemaking initiatives, exchange listing and compliance developments, and enforcement trends that collectively shape the operating environment for smaller public companies and their advisors. Through comment letters and client advisories, Sullivan’s Small-Firm Task Force serves as a platform for thought leadership and advocacy in this evolving space.

Integrated Capital Markets and Regulatory Experience

Sullivan’s Capital Markets team represents underwriters and issuers in public and private offerings of equity, equity-linked securities and debt, as well as in their routine compliance and related obligations. We have particular experience in IPOs, private investments in public offerings, self-underwritings, registered direct offerings, and convertible and hybrid securities. Our lawyers regularly advise leading small to mid-sized investment banks and corporate clients across a variety of industries including technology, biotech, energy and retail.

Our capital markets attorneys and litigators are routinely paired to ensure compliance from the outset of an engagement and to evaluate potential regulatory, litigation or investigation risks when they arise. The two disciplines routinely interact during the life of a client engagement to ensure that best practices are maintained and periodically evaluated and re-evaluated.

Proactive Regulatory and Compliance Guidance

Sullivan’s Regulatory Compliance Group is a unique interdisciplinary practice focused on regulatory compliance and enforcement, white-collar defense, and investigations before administrative, legislative, and self-regulatory agencies. The Group works closely with the Firm’s Special Investigations & Compliance and Capital Markets teams to assure regulatory compliance—the foundation on which our capital markets clients operate. Our practice preference is proactive: we review clients’ policies and procedures to help anticipate and avoid regulatory red flags, traps and surprises.

Government Investigations and Litigation Capabilities

Our attorneys conduct thorough internal investigations and routinely represent clients before agencies. When necessary, we draw on extensive litigation and trial experience to defend clients in court or agency forums. Sullivan’s transactional and enforcement attorneys work closely together to understand the compliance dynamics and to develop oversight standards informed by experience with the DOJ, SEC, self-regulatory organizations and federal regulators overseeing a variety of financial industries.

Viewpoints
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SEC Establishes Retail Fraud Working Group to Combat Fraud Targeting Everyday Investors
The U.S. Securities and Exchange Commission (“SEC”) announced on July 7, 2026, the creation of the Retail Fraud Working Group, a new initiative within the Division of Enforcement designed to identify and combat fraud targeting main street investors. The announcement formalizes a priority that SEC Enforcement Director David Woodcock previewed in his May 13, 2026, remarks to the Managed Funds Association Legal & Compliance Conference, reflecting the current Commission’s broader back-to-basics enforcement posture. For issuers, broker-dealers, investment advisers, and private fund managers with retail exposure, the announcement signals that retail-facing enforcement will be a sustained focus of the Division’s work in the months and years ahead. Overview The Retail Fraud Working Group will leverage staff and resources across the Commission to identify fraud and other misconduct targeting retail investors, including offering frauds, pump-and-dump schemes, market manipulation, and breaches of duties owed to customers by investment advisers and broker-dealers. The Group’s initiative is threefold: (i) to serve as a dedicated resource to proactively generate cases; (ii) to work with the Commission’s domestic regulatory partners and foreign counterparts; and (iii) to assist with educating retail investors in coordination with the SEC’s Office of Investor Education and Assistance. The Group will be led by Kate Zoladz, Deputy Director, West, and Kim Frederick, Assistant Director of the Asset Management Unit. Ms. Frederick’s role in the Asset Management Unit suggests that adviser and private fund conduct affecting retail investors will be a focus area for the Group. Chairman Paul S. Atkins described the initiative as “a return to the core values and principles of the enforcement program,” and Director Woodcock emphasized the Group’s role in “generating cases, building partnerships with our regulatory counterparts, and using data and technology to find and stop those who seek to take advantage of retail investors.” About Our Small-Firm Task Force Sullivan & Worcester’s Small-Firm Task Force is actively engaged in advising clients on the implications of the Retail Fraud Working Group and can assist with responding to any related SEC inquiries. The Task Force unites the firm’s Capital Markets, Regulatory Compliance, Government Investigations, and Financial Services Litigation practices, each with deep experience advising issuers, broker-dealers, investment funds, and institutional investors in the small-cap, micro-cap, and mid-market segments. Our interdisciplinary team is well-positioned to help clients navigate the SEC’s renewed retail-fraud enforcement priorities and to develop practical, risk-based compliance strategies aligned with the current regulatory environment.
Sullivan & Worcester Submits Rebuttal Comment Letter to SEC on Nasdaq’s Proposed Market Value Listing Requirement
On June 3, 2026, Sullivan & Worcester submitted a rebuttal comment letter to the U.S. Securities and Exchange Commission (SEC) in response to comment letters supporting Nasdaq’s proposed continued listing requirement mandating that companies maintain a minimum Market Value of Listed Securities of $5 million. The letter was authored by partners David Danovitch, Angela Gomes, and Brendan O’Brien, and associate Phillip Carnevale. Building on the firm’s prior submissions, Sullivan argued that the comment letters that were in support of the Nasdaq proposal failed to provide empirical evidence linking the proposed $5 million threshold to fraud, manipulation or enhanced investor protection. Sullivan's letter also buttressed its earlier letters by highlighting additional market data demonstrating that many companies that temporarily fell below the proposed threshold subsequently recovered above a $5 million market capitalization threshold, resulting in the creation of significant shareholder value. For these reasons, Sullivan urged the SEC to disapprove the proposal. Through its interdisciplinary Small-Firm Task Force, Sullivan continues to advocate for practical, evidence-based regulatory approaches affecting small-cap, micro-cap and mid-market public companies and their investors.  To stay informed on developments affecting small-cap and micro-cap market participants, visit Sullivan’s Small-Firm Task Force resource center, which provides ongoing insights, commentary and updates on the evolving regulatory landscape.
SEC Turns the Spotlight On Nasdaq Delisting Standards
David Danovitch was quoted in the article "SEC Turns the Spotlight on Nasdaq Delisting Standards," published by Law360 [sub. req'd] on May 1, 2026. The article discusses the U.S. Securities and Exchange Commission’s decision to delay implementation of proposed Nasdaq delisting standards to allow for additional public comment, following concerns that the changes could expose smaller companies to market abuse and limit their ability to appeal delisting decisions. “It’s not the norm,” David says, referring to the SEC’s decision to pause its review. “And I think it reflects the fact that the comments, particularly the comments in opposition or expressing concern about the proposal’s implementation, gave the SEC quite a lot to think about,” he adds.
SEC, FINRA Cross-Border Crackdown Typifies Trump 2.0 Priorities
David Danovitch was quoted in the article "SEC, FINRA Cross-Border Crackdown Typifies Trump 2.0 Priorities," published by Bloomberg Law on November 4, 2025. The article discusses the growing US regulatory focus by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) on foreign issuers, aiming to crack down on fraud involving overseas companies listing on US exchanges. The approach is in keeping with the Trump administration’s general position toward Chinese businesses and other international competitors.   “There were parties basically hijacking IPOs and using them as vehicles for a pump-and-dump,” David says, referring to foreign issuers reporting questionably large returns despite a lack of sales activity to support such figures.  Nasdaq has proposed rules that would require companies based in China to raise at least $25 million in public offering proceeds to qualify for new listings, under the reasoning that a larger IPO would be more difficult to manipulate. “These are small firms, so our concern is that this could bankrupt a few firms or inhibit their ability to comply properly,” David comments. “You want your regulators to root out the crime and make sure investors here aren’t getting hurt.”