ONE YEAR OF OPPOSITION: ONLY SPACEX BACKS HIGHLY CONTROVERSIAL SEC ATTACK ON SHAREHOLDERS AFTER 365 DAYS, 330+ IPOS FILED
Institutional Investors, Shareholders, and Regulators Lead Broad Rejection of Chairman Atkins' Unprecedented Policy Reversal.
WASHINGTON, DC – SEPTEMBER 17, 2026 – At the one-year mark since the Securities and Exchange Commission’s (SEC) controversial policy reversal to allow forced arbitration, the Alliance to Protect Shareholder Value reviewed new initial public offerings (IPOs) and found that out of over 330 IPO filings since the reversal, only Elon Musk’s SpaceX had adopted a forced shareholder arbitration provision.
Over the past 12 months, the SEC’s radical policy change has been so unpopular that over 99% of IPO companies continued to avoid forced shareholder arbitration, and the only company to take advantage of the SEC’s recent shift is now the most scrutinized IPO in decades.
The Alliance to Protect Shareholder Value issued the following statement:
One year in, the verdict is clear: the overwhelming majority of companies have rejected Chairman Atkins' unprecedented policy reversal on forced arbitration.
When corporations force shareholders, the true owners of the company, into private, individual, mandatory arbitration, shareholders lose the right to band together to hold company management accountable for violating the law.
Investors should take note that SpaceX remains the only major company that has attempted to decimate its shareholders’ rights and protections in this way, causing SpaceX investors to have far less rights and protections than every other public equities investor in the country.
Background: A year of opposition
On September 17, 2025, the Securities and Exchange Commission (SEC) reversed its decades-old policy – along a party-line vote, without public comment – that protected investors’ right to hold corporations publicly accountable for securities fraud.
When SpaceX’s IPO occurred on June 12, 2026, controversy was already swirling around the company’s unprecedented and extreme governance structure. That structure grants Elon Musk near-total control of SpaceX and strips shareholders of their right to hold the company accountable if it or any of its officers, directors, or controlling managers breaks the law or commits fraud.
For decades, forced arbitration clauses were prohibited from IPO filings. Prior SEC officials across the political spectrum reaffirmed the prohibition on numerous occasions, citing concerns that forced arbitration would have a devastating impact on investor protections and public markets, and could violate securities laws. The few major public companies that considered adopting such clauses ultimately rejected them in the face of widespread shareholder disapproval. Last year, Chairman Paul Atkins abandoned the SEC’s longstanding position, prompting widespread outcry from institutional investors, state officials, and legal experts.
Following the SEC's policy reversal, a wide range of stakeholders urged the Commission to change course, including 61 pension funds and institutional investors, the International Corporate Governance Network (ICGN), the San Francisco City & County Employees’ Retirement System, the Council of Institutional Investors (CII), Oregon’s State Treasurer, the California Public Employees’ Retirement System (CalPERS), and the proxy advisor Glass Lewis.
Sens. Elizabeth Warren and Jack Reed said the change was "a significant mistake, putting investors and markets at risk." This would eliminate the critical tool of private securities litigation for securities law enforcement, denying relief for investors and allowing misconduct to go unpunished.”
Former SEC Commissioner Caroline Crenshaw said the policy shift is “out of step with history and the law," "another way to stack the deck against investors," and "doubling down on disenfranchisement." Former SEC Commissioner Joseph Grundfest said, “if you are looking for a fight with your shareholders, this is a way to have one.”
Experts have also raised the alarm that the shift risks putting everyday investors at risk, hurting U.S. stock valuations and investor confidence, destabilizing our markets, and creating a “mess” for D&O insurance.