The Commercial Division Gets A New Corporate Disclosure Rule
On October 4, 2021, Chief Administrative Judge Lawrence K. Marks promulgated Rule 35 of the Rules of Practice for the Commercial Division to require corporate entities litigating or seeking to intervene in cases to submit statements disclosing any corporate parent or publicly held companies that are sufficiently invested in the party or proposed intervenor.
Rule 35 requires a non-governmental corporate party and a non-governmental corporation that seeks to intervene in a case to “file a disclosure statement that: (1) identifies any parent corporation and any publicly held corporation owning 10% or more of its stock; or (2) states that there is no such corporation.” The new rule also provides that such disclosure statements must be filed with a party or intervenor’s “first appearance, pleading, petition, motion, response, or other request addressed to the court” and that a supplemental statement must be filed if any required information changes.
Corporate disclosure requirements like the new Rule 35 assist judges in deciding whether they have an interest in any of a party’s related corporate entities that would disqualify them from hearing the case. Section 100.3(E)(1)(c) of the Rules of Judicial Conduct require Commercial Division justices to recuse themselves from proceedings where the justice or a fiduciary “has an economic interest in the subject matter in controversy or in a party to the proceeding.” However, the Commercial Division does not currently require parties to file a minimum financial disclosure. The new rule does not require disclosure of all conceivable circumstances that might necessitate disqualification due to a justice’s economic interests, but its aim is to help prevent justices from hearing cases in which they have been or could be accused of having an improper interest or bias.
Rule 35 of section 202.70(g) of the Rules of Practice for the Commercial Division takes effect on December 1, 2021.
 The Federal Rules of Civil Procedure and Federal Rule of Appellate Procedure both have similar disclosure requirements. See Federal Rule of Civil Procedure 7.1 and the Federal Rule of Appellate Procedure Rule 26.1.