DORSEY & WHITNEY LLP
50 South Sixth Street
Minneapolis, Minnesota 55402

James D. Alt
(612) 340-2803

March 5, 2003

Via e-mail: rule-comments@sec.gov

Jonathan G. Katz, Secretary
Securities and Exchange Commission
450 Fifth Street, NW
Washington, D.C. 20549-0609

Re: File No. S7-45-02

Dear Mr. Katz:

In Release No. 33-8186, the Commission requests comment on 17 CFR Part 205, as adopted in Release No. 33-8185. I am submitting this letter to suggest that the Commission clarify, either in Part 205 or by means of a FAQ, a question that has arisen under the rules as adopted in Release No. 33-8185.

Section 205.5(c) of the rules provides that a subordinate attorney complies with Section 205.3 if he or she reports evidence of a material violation to his or her supervisory attorney. However, Section 205.5(c) does not specify whether reporting to the supervisory attorney is the only way a subordinate attorney can comply with Section 205.3 or whether, alternatively, a subordinate attorney also could comply with Section 205.3 by reporting directly to an issuer's chief legal officer or qualified legal compliance committee.

The following statement in the proposing release for Part 205 appears to me to imply that a subordinate attorney can comply with Section 205.3 only by reporting to his or her supervisory attorney:

"Paragraph 205.5(c), which obligates subordinate attorneys to report evidence indicating a material violation to their supervisor, is related to paragraph 205.4(c), which provides that a supervisory attorney is charged with the responsibility for compliance with Section 205.3(b)'s reporting requirement when a subordinate attorney reports evidence of a material violation. As with paragraph 205.4(c), paragraph 205.5(c) is premised upon the concept that supervisory attorneys are in a better position than subordinate attorneys to report instances of possible material violations to appropriate individuals in the issuer."

Release No. 33-8150, Part V (addressing Section 205.5) (emphasis supplied). In addition, I note that Section 205.5(d) provides that in specified circumstances, a subordinate attorney may report evidence of a material violation directly to an issuer's chief legal officer or qualified legal compliance committee after the subordinate attorney has reported to his or her supervisory attorney, but it does not authorize a subordinate attorney to do so instead of reporting to the supervisory attorney.

Despite this, I understand that some practitioners have concluded that a subordinate attorney could satisfy his or her reporting obligation under Part 205 either by reporting to his or her supervisory attorney, or by reporting directly to an issuer's chief legal officer or qualified legal compliance committee. Their theory is that nothing in Part 205 expressly precludes a subordinate attorney from reporting directly to an issuer's chief legal officer or qualified legal compliance committee rather than to his or her supervisory attorney.

Because some confusion appears to surround this point, I am writing to suggest that the Commission clarify it, either in Part 205 itself or by means of a FAQ. Thank you very much for considering this suggestion.

Very truly yours,

James D. Alt