Corporate Defense and Disputes

Important developments in U.S. securities law, white collar criminal defense, regulatory enforcement and other emerging issues impacting financial services institutions, publicly traded companies and private investment funds

Tag Archives: Adminstrative Proceedings

Joshua Newville Discusses Amendments to Rules Governing SEC Administrative Proceedings with Compliance Week

Last month, the SEC announced that it had adopted amendments updating the rules of practice governing its in-house administrative proceedings.  On August 9, 2016, Compliance Week published an article on the recently-adopted amendments, entitled, SEC modifies administrative proceedings, but did it go far enough? The article features insights from Proskauer partner Joshua Newville, who discusses … Continue Reading

Who Wins in SEC Administrative Proceedings?

A handful of recent SEC defeats in administrative proceedings have caused us to question the conventional narrative that the SEC has a distinct “home field advantage” before its own administrative law judges.  According to analysis conducted by the Wall Street Journal, the SEC had a 90% win rate in contested cases it brought before its … Continue Reading

SEC Adopts Amendments to Rules Governing Its Administrative Proceedings

Earlier today, the SEC announced that it will adopt certain amendments to its rules of practice governing administrative proceedings. Faced with criticism from practitioners and the media regarding a perceived “home field advantage” in administrative proceedings, as well as various constitutional challenges to the ALJ process, the SEC has now approved amendments “intended to update … Continue Reading

Eleventh Circuit Considers Challenge to SEC Administrative Proceedings

Last week, in the consolidated cases of Charles Hill, Jr. v. SEC (No. 15-12831) and Gray Financial Group, Inc. v. SEC (No. 15-13738), the U.S. Court of Appeals for Eleventh Circuit heard oral argument on the question of whether federal district courts have jurisdiction to review constitutional challenges to SEC administrative enforcement proceedings. The Eleventh … Continue Reading

D.C. Circuit Joins Seventh Circuit in Rejecting Court Challenges to Pending SEC Administrative Enforcement Proceedings

The U.S. Court of Appeals for the District of Columbia Circuit held today that federal District Courts do not have subject-matter jurisdiction to entertain challenges to ongoing SEC administrative enforcement proceedings. A party to a pending administrative proceeding must defend against that proceeding and then seek review from the SEC Commissioners and, eventually, the federal … Continue Reading

SEC Proposes Amendments to Rules Governing Administrative Proceedings

The Securities and Exchange Commission appears to be hearing the music.  In response to the many voices that have expressed dissatisfaction with the procedures used in SEC administrative hearings, the SEC today issued proposed amendments to the rules governing those hearings.  Those proposals are now subject to public notice and comment.… Continue Reading

SEC Again Rejects Constitutional Challenges to Administrative Enforcement Proceedings

The Securities and Exchange Commission again rejected constitutional challenges to the use of administrative enforcement proceedings presided over by Administrative Law Judges (“ALJs”).  The Commission’s September 17, 2015 decision in In the Matter of Timbervest, LLC – the Commission’s second ruling on the constitutional issue in the past two weeks – rebuffed arguments that ALJ … Continue Reading

Seventh Circuit Rejects Court Challenge to Pending SEC Administrative Enforcement Proceeding

The Seventh Circuit has held that federal district courts do not have subject matter jurisdiction over challenges to ongoing SEC administrative enforcement proceedings where the challenger is already a party to those proceedings.  Instead, a party to a pending administrative proceeding must defend against the proceeding and then seek review from the SEC Commissioners and, eventually, the … Continue Reading

New York District Court Appears to Sustain Attack on SEC Administrative Proceedings

A federal District Judge in the Southern District of New York appears to have conditionally sustained a facial challenge to an administrative enforcement proceeding conducted by Administrative Law Judges (“ALJs”) of the Securities and Exchange Commission. In an August 3, 2015 decision in Duka v. SEC, 1:15-cv-00357, Judge Richard M. Berman held that he had subject-matter … Continue Reading

Constitutional Challenges to SEC Administrative Proceedings

May defendants charged in SEC administrative proceedings challenge the constitutionality of those proceedings in federal district court? The determination of whether district courts have subject matter jurisdiction over such challenges has become the critical prelude in the ongoing controversy over the SEC’s seemingly arbitrary use of its “home court” alternative to pursue claims and remedies … Continue Reading

Goodyear Pays for the Acts of its Subsidiaries in a $16 Million FCPA Settlement

Following recent trends, the U.S. Securities and Exchange Commission brought an administrative proceeding against a U.S. issuer for the alleged corrupt activities of its foreign subsidiaries. Earlier this week, Goodyear Tire & Rubber Company agreed to pay the SEC over $16 million to settle charges alleging that it violated the accounting provisions of the Foreign … Continue Reading

District Court Rejects Constitutional Challenge to SEC Administrative Proceedings

We recently wrote that critics, including Judge Jed Rakoff, have been questioning the SEC’s policy of increasingly bringing enforcement actions in its administrative forum rather than federal court.  We noted that several cases had been filed recently that challenged the constitutionality of the SEC’s administrative proceedings.  The first of those cases has now been decided:  … Continue Reading

Critics Question SEC’s Increasing Use of Administrative Enforcement Proceedings

The SEC is increasingly bringing enforcement actions in its administrative forum rather than federal district court, setting the stage for a legal and policy battle over this tactic. The SEC’s approach has been made possible by a series of legislative enhancements to the agency’s enforcement powers that began with the passage of the Securities Enforcement … Continue Reading
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