Group Urges SEC To Expand Accredited Investor Rule To Cover Same-Sex Couples

The U.S. Supreme Court's Windsor decision striking down Section 3 of the Defense of Marriage Act is rippling through unexpected corners of federal regulation.  A group of investors and entrepreneurs calling themselves StartupEquality.org last week sent a letter (full text) to the Securities and Exchange Commission urging the expansion of SEC's Regulation D that allows businesses to raise capital from wealthy investors in private placements without filing a full registration statement. SEC Rule 501 defines "accredited investors"-- those who may purchase in private placements-- as including spouses who jointly meet certain income or net worth levels.  The group's letter says that the Windsor decision should be read to automatically extend Rule 501 to same-sex married couples, and urges the SEC to expand the rule so that same-sex couples in civil unions, domestic partnership arrangements and the like who are unable to marry may also aggregate their income and assets to determine accredited investor status.