On June 26, 2024, in Washington, the United States, people lined up to enter the U.S. Supreme Court on the day the ruling was expected to be made.
Kevin Lamarque | Reuters
WASHINGTON — The Supreme Court on Thursday imposed new limits on the Securities and Exchange Commission’s authority to enforce securities laws — the latest ruling in a series of cases against the federal agency.
The court ruled 6-3 that the in-house judge’s decision in the case violated the right to a jury trial.
The case is one of several pending cases involving conservative and business-led attacks on the power of federal agencies. The court’s 6-3 conservative majority is generally sympathetic to such arguments.
The challenge centers on how the SEC enforces securities laws, including laws prohibiting insider trading. The SEC has long hosted an internal process by an administrative law judge. The agency can also file suit in federal court. In both sets of lawsuits, it could seek financial penalties.
Those subject to internal rulings complain that the process violates their rights and gives the SEC too much power by essentially creating a home-field advantage.
Hedge fund manager George Jarkesy faces SEC charges that he violated the law by making false statements and omitting relevant information in communications with investors while overseeing two hedge funds. securities laws, and he subsequently filed a legal challenge.
Jarkesy and his firm were ordered to pay a $300,000 fine, and he was barred from holding certain positions in the securities industry following an internal lawsuit in 2014. “
Jaxi’s legal reforms are backed by billionaires Elon Musk and Mark Cuban.
A three-judge panel of the New Orleans-based 5th U.S. Circuit Court of Appeals ruled against the agency, prompting the SEC to ask the Supreme Court to intervene.
