Supreme Court Misses Its Chance To Define Limits of SEC’s Enforcement Authority

Earlier this week the United States Supreme Court issued its third opinion in seven years clarifying the limits of monetary sanctions imposed in enforcement actions brought by the U.S. Securities and Exchange Commission (SEC). Like the Court’s two earlier decisions, Liu v. Securities and Exchange Commission confirmed that the statutory remedies available to the SEC are subject to the same constraints as similar remedies recognized under common law. Unlike the Court’s two earlier decisions, though, Liu established no new temporal limitations on the SEC’s ability to impose those statutory remedies in SEC enforcement actions. For this reason, and considering that the primary holding of the case was something of a forgone conclusion, Liu was a missed opportunity.