The Washington Legal Foundation announced:
On March 3, 2017, WLF asked the U.S. Supreme Court to overturn a Tenth Circuit decision that permitted the SEC to seek monetary penalties for securities law violations that occurred decades ago. In an amicus brief filed in the case, WLF argued that a strict five-year statute of limitations (28 U.S.C. § 2462) precludes such SEC enforcement actions. WLF reminded the appeals court that statutes of limitations serve important goals; they permit citizens to arrange their affairs secure in the knowledge that they won’t suddenly face sanctions based on long-ago events. WLF’s brief further contended that the “disgorgement” remedy SEC sought in the case has never been recognized as an equitable remedy throughout American legal history. Because the SEC never attempted to use disgorged funds to provide restitution to fraud victims, those funds served a punitive rather than a remedial purpose.
The discussion of the nature of the disgorgement remedy is particularly interesting. If the Court decides to take up that issue, it's ruling will have potentially important results beyond just the statute of limitations issue. In particular, it will force courts to deal with the issue of whether there is a right to jury trial in disgorgement cases. My sense of the law is that most courts assume there is no jury trial right, but the cases rarely dig into the issue in any depth.
