Articles

Jimmy Fokas, Bari Nadworny Article Examines Supreme Court Ruling Limiting Disgorgement

Articles / July 14, 2017

Partner Jimmy Fokas and Associate Bari Nadworny authored an article published July 10, 2017, by Bloomberg BNA. The article, “Kokesh v. SEC – Unanimous Supreme Court Once Again Limits SEC’s Enforcement Authority,” analyzes the recent U.S. Supreme Court ruling in Kokesh v. SEC that the Securities and Exchange Commission’s (SEC) authority to seek disgorgement of ill-gotten gains is subject to a five-year statute of limitations. They also examine the circuit split regarding the SEC’s use of administrative proceedings to litigate enforcement actions.

Fokas and Nadworny conclude:

A decision like Kokesh will certainly affect the way the SEC conducts its investigations as the SEC will no longer be able to rely on an unlimited period for which to seek disgorgement. To preserve its ability to seek monetary relief ̶ often the toughest remedies in its enforcement arsenal ̶ the SEC will waste little time in bringing actions. As the circuit courts grapple with the constitutionality of the SEC's administrative proceedings, it is likely that the Supreme Court will weigh in once again.

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