On June 27, 2024, the Supreme Court issued its decision in SEC v. Jarkesy, holding that the Seventh Amendment right to a jury trial applies to enforcement actions seeking civil penalties for alleged violations of the...more
7/1/2024
/ Administrative Authority ,
Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Constitutional Challenges ,
Enforcement Actions ,
Jury Trial ,
SCOTUS ,
SEC v Jarkesy ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Securities Regulation ,
Seventh Amendment
On May 18, 2022, the US Court of Appeals for the Fifth Circuit issued its decision in Jarkesy v. SEC, vacating a Securities and Exchange Commission (SEC) decision in an enforcement action brought as an administrative...more
On January 1, 2021, amendments to Section 21(d) of the Securities Exchange Act of 1934 (Exchange Act) codifying and expanding the power of the Securities and Exchange Commission (SEC or Commission) to obtain disgorgement in...more
On June 22, the Supreme Court held in Liu v. SEC that the SEC may obtain disgorgement in federal court cases, as long as the disgorgement does not exceed a wrongdoer’s “net profits and is awarded for victims.” The Court’s...more
6/25/2020
/ 15 U.S.C. § 78u(d)(5) ,
Administrative Authority ,
Business Expenses ,
Calculation of Damages ,
Corporate Misconduct ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Kokesh v SEC ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Net Profits ,
Remedies ,
SCOTUS ,
Securities and Exchange Commission (SEC)
On August 23, 2019, the Securities and Exchange Commission (SEC or Commission) held in In re John M.E. Saad that the US Supreme Court’s decision in Kokesh v. SEC had no impact on the Financial Industry Regulatory Authority’s...more
The Supreme Court yesterday took a significant step to expand the universe of actors who can be held liable for a false statement under the federal securities laws. The Supreme Court held in Lorenzo v. SEC that a person who...more
3/29/2019
/ Appeals ,
Enforcement Actions ,
False Statements ,
Fines ,
Intent to Defraud ,
Investment Banks ,
Lorenzo v SEC ,
Material Dissemination ,
Misleading Statements ,
Reaffirmation ,
Rule 10b-5 ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Suspensions
On June 21, 2018, the Supreme Court issued its decision in Lucia v. SEC, Slip Op. No. 17-130. Securities and Exchange Commission (SEC) administrative law judges (ALJs) have traditionally been appointed by SEC staff members,...more
6/25/2018
/ Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Appeals ,
Appointments Clause ,
Constitutional Challenges ,
Corporate Counsel ,
Enforcement Actions ,
Final Written Decisions ,
Lucia v SEC ,
Officers of the United States ,
Remand ,
Reversal ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Special Trial Judges (STJs)
For U.S. Securities and Exchange Commission enforcement practitioners, perhaps the blockbuster decision of the last U.S. Supreme Court term was Kokesh v. SEC — but not for the reason that you might suspect. In Kokesh, the...more
Earlier this month, the Supreme Court ruled unanimously in Kokesh v. SEC that a claim for disgorgement arising from the violation of federal securities law constitutes a “penalty” for purposes of the general statute of...more
Continuing its efforts to bring enforcement actions for violations of whistleblower protections, the Securities and Exchange Commission recently settled two more cases. Both cases involved severance agreements that contained...more
Last week, the SEC's Office of Compliance Inspections and Examinations (“OCIE”) issued a Risk Alert regarding examinations of investment adviser and broker-dealer registrants' compliance with key whistleblower provisions...more
The Securities and Exchange Commission (SEC) continues to pursue enforcement actions against companies for whistleblower-related violations. The latest in a recent string of settled orders, which include the SEC's first case...more
The Securities and Exchange Commission (SEC) recently announced settlements with two companies for using severance agreements that allegedly violated Rule 21F-17. [Order Instituting Cease-And-Desist Proceedings, In the Matter...more
In recent years, the U.S. Department of Justice has stepped up its use of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 to pursue civil enforcement actions against financial institutions and their...more
In a landmark May 26, 2016 decision, the U.S. Court of Appeals for the Eleventh Circuit became the first appellate court to rule that Securities and Exchange Commission (‘‘SEC’’) actions for disgorgement are subject to a...more
This is the last of four articles examining the scope of the Seventh Amendment jury trial right as applied to the facts that set the maximum monetary penalty a judge may impose against a civil defendant in a U.S. Securities...more
7/26/2016
/ Civil Monetary Penalty ,
Deceptive Intent ,
Enforcement Actions ,
Fraud ,
Jury Instructions ,
Negligence ,
Recklessness ,
Right to a Jury ,
Rule 10b-5 ,
Scienter ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Litigation ,
Securities Violations ,
Seventh Amendment ,
Strict Liability
This is the third of four articles examining the scope of the Seventh Amendment jury trial right for civil defendants in U.S. Securities and Exchange Commission enforcement actions. Our first article explained why the Seventh...more
7/19/2016
/ Causation ,
Detrimental Reliance ,
Enforcement Actions ,
Enhanced Penalties ,
Jury Instructions ,
Loss Causation ,
Penalties ,
Recklessness ,
Right to a Jury ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Securities Litigation ,
Securities Violations ,
Seventh Amendment
This is the second of four articles examining the scope of the Seventh Amendment jury trial right for civil defendants in U.S. Securities and Exchange Commission enforcement actions. The previous article explained why the...more
7/14/2016
/ Administrative Proceedings ,
Civil Monetary Penalty ,
Due Process ,
Enforcement Actions ,
Jury Instructions ,
Right to a Jury ,
Rule of Lenity ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Litigation ,
Securities Violations ,
Seventh Amendment ,
Sixth Amendment
It has been settled law for some time now that the Seventh Amendment right to a jury trial in U.S. Securities and Exchange Commission enforcement actions extends to liability determinations. Unsettled is the question of...more
Last year, the Enforcement Division of the SEC announced its intention to bring more enforcement actions in its own administrative forum rather than in federal court. The authors describe these administrative proceedings...more
On April 1, the US Securities and Exchange Commission issued—in a settled administrative proceeding—a cease-and-desist order in In the Matter of KBR, Inc., directing that the respondent cease violating Commission Rule...more