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Federal Register / Vol. 86, No. 152 / Wednesday, August 11, 2021 / Notices received no comment on this provision.
As discussed above, the Commission is modifying Article I, Section 1.1k of the CT Plan to define the term, Company Indemnified Person, to include NonSRO Voting Representatives. This provision is approved as proposed.
c Appearance as a Witnesses Article XII, Section 12.4 of the CT
Plan provides for the payment or reimbursement of reasonable out-ofpocket expenses incurred by a Company Indemnified Party in connection with appearance as a witness or other participation in a Proceeding at a time when the Company Indemnified Party is not a named defendant or respondent in the Proceeding. The Commission received no comment on this provision.
As the Commission is modifying Article I, Section 1.1k of the CT Plan to define the term, Company Indemnified Person, to include Non-SRO Voting Representatives, as discussed above, Section 12.4 is approved as proposed.
d Nonexclusivity of Rights Article XII, Section 12.5 of the CT
Plan provides that the right to indemnification and the advancement and payment of expenses conferred in Article XII shall not be exclusive of any other right a Company Indemnified Person may have or hereafter acquire.
The Commission received no comment on this Section 12.5. As the Commission is modifying the CT Plan to define the term, Company Indemnified Person, to include Non-SRO Voting Representatives, as discussed above, this provision is approved as proposed.
12. Miscellaneous Provisions
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a Expenses Article XIII, Section 13.1 of the CT
Plan governs the payment of expenses by the CT Plan and requires that all such expenses must be paid before any allocations may be made to the Members. Section 13.1 further provides that Members will be responsible for reserves for contingent liabilities and that each Member shall be responsible for the costs of any technical enhancements made at its request and solely for its use, unless another Member subsequently makes use of the enhancement. The Commission received no comment on Section 13.1 and is approving the provision as proposed.
b Entire Agreement Article XIII, Section 13.2 of the CT
plan provides that the CT Plan will supersede the existing Equity Data Plans and all other prior agreements with respect to consolidated equity market data. The Commission received no
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comment on Section 13.2 and, because the provision is consistent with the requirements of the Commissions Governance Order,875 is approving the provision as proposed.
c Notices and Addresses Article XIII, Section 13.3 of the CT
Plan provides that all communications must be written and sets forth the permissible methods of delivery. The Commission received no comment on Section 13.3 and is approving the provision as proposed.
d Governing Law Article XIII, Section 13.4 of the CT
Plan provides that Delaware law will be the governing law for the CT Plan.
Specifically, the CT Plan states that the Agreement will be governed by and construed in accordance with the Delaware Act and internal laws and decisions of the State of Delaware, without regard to the conflicts of laws principles thereof but will also be subject to any applicable provisions of the Act and any rules and regulations promulgated thereunder. Section 13.4
further states that, for the avoidance of doubt, nothing in this Agreement waives any protection or limitation of liability afforded any of the Members or any of their Affiliates by common law, including the doctrines of selfregulatory organization immunity and federal preemption.
In the Notice, the Commission sought comment on this provision.876 The Commission received one comment on Section 13.4. The commenter asks whether the language regarding the limitation of liability may be inconsistent with the exculpation and indemnification provisions of Article XII.877 The Commission does not believe that the provisions of Section 13.4 are inconsistent either with the provisions of Article XII or with federal securities law. Article XII of the CT Plan speaks to the agreed exculpation and indemnification provisions of the LLC
Agreement, but, as the Commission has discussed above, the provisions of the CT Plan cannot limit or diminish the obligations and duties of the Members 875 See Governance Order, supra note 8, 85 FR at 28729 The New Consolidated Data Plan shall provide for the orderly transition of functions and responsibilities from the three existing Equity Data Plans and shall provide that dissemination of, and fees for, SIP data will continue to be governed by the provisions of the Equity Data Plans until the New Consolidated Data Plan is ready to assume responsibility for the dissemination of SIP data and fees of the New Consolidated Data Plan have become effective..
876 See Notice, supra note 3, 85 FR at 64573
Question 51.
877 See Data Boiler Letter I, supra note 31, at 5, 46.

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as self-regulatory organizations under the federal securities laws and the regulations thereunder.878 Similarly, the general reference in Section 13.4 to the common law, including what the CT
Plan describes as the doctrines of selfregulatory organization immunity and federal preemption, cannot enlarge or otherwise modify any case law that defines the scope of SRO liability.879
For the reasons discussed above, the Commission is approving this provision, as proposed.
e Amendments Article XIII, Section 13.5 of the CT
Plans governs amendments to the CT
Plan. Paragraph a of Section 13.5 states that the CT Plan may be modified when authorized by the Operating Committee pursuant to Section 4.3, subject to the requirements of Section 11A of the Act and Rule 608 of Regulation NMS.
Paragraph b of Section 13.5 carves out an exception to the general rule set forth in the preceding paragraph, stating, notwithstanding Section 13.5a, Articles IX, X, XI, and XII may be modified upon approval by a majority of Members; provided, however, that Operating Committee approval pursuant to Section 4.3 will be required for modifications to the allocation.
Emphasis in original. Paragraph c of Section 13.5 sets forth the process for Ministerial Amendments, in which the Chair of the Operating Committee may modify the CT Plan by filing an amendment with the Commission unilaterally, so long as 48-hours advance notice is provided to the Operating Committee. Paragraph d of 878 See
supra Section II.C.1b.
respect to the judicial doctrine of regulatory immunity, the Commission has taken the position that immunity from suit is properly afforded to the exchanges when engaged in their traditional self-regulatory functionswhere the exchanges act as regulators of their members, including the core adjudicatory and prosecutorial functions that have traditionally been accorded absolute immunity, as well as other functions that materially relate to the exchanges regulation of their members, but should not extend to functions performed by an exchange itself in the operation of its own market, or to the sale of products and services arising out of those functions. Order Setting Aside Action by Delegated Authority and Approving a Proposed Rule Change, Securities Exchange Act Release No. 88008 Jan. 21, 2020, 85 FR 4726, 4735 Jan. 27, 2020 File No.
SRBatsBZX201734 citing Brief of the Securities and Exchange Commission, Amicus Curiae, No. 153057, City of Providence v. Bats Global Markets, Inc. 2d Cir. 2016, at 22. The Court of Appeals for the Second Circuit recently reached a similar conclusion. See City of Providence v. Bats Global Markets, Inc., 878 F.3d 36, 48 2d Cir. 2017 When an exchange engages in conduct to operate its own market that is distinct from its oversight role, it is acting as a regulated entitynot a regulator. Although the latter warrants immunity, the former does not..
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