Securities and Exchange Commission

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In SEC v. Sripetch, No. 24-3830, 2025 WL 2525848 (9th Cir. Sept. 3, 2025), the United States Court of Appeals for the Ninth Circuit affirmed a $2.25 million disgorgement award obtained by the United States Securities and Exchange Commission (“SEC”) in an enforcement action, rejecting the argument that the SEC must prove pecuniary harm to investors before obtaining disgorgement under 15 U.S.C. §§ 78u(d)(5) and (d)(7). This decision deepens a split between Circuits that require a showing of pecuniary harm to investors in this context, and those that do not. As it stands now, the First, Fifth and Ninth Circuits have generally agreed that the SEC does not need to show individual investor harm impose disgorgement, whereas the Second Circuit holds the opposite. This split on a critical issue of SEC enforcement raises the specter of review by the United States Supreme Court.Continue Reading Ninth Circuit Clarifies SEC Disgorgement Standard, Aligning with the First and Fifth Circuits and Disagreeing with the Second Circuit

The United States Court of Appeals for the District of Columbia Circuit recently held that the Securities and Exchange Commission (“SEC”) and the securities industry were effectively “separated by a common language.” Giving heed to the plain meaning rule when interpreting legislative intent, the Court in Institutional Shareholder Services, Inc. v. SEC, No. 24-5105, —F.4th —, 2025 WL 1802786 (D.C. Cir. July 1, 2025), affirmed an order of the United States District Court for the District of Columbia (see Institutional Shareholder Services, Inc. v. SEC, 718 F. Supp. 3d 7 (D.D.C. 2024)), granting summary judgment to plaintiff Institutional Shareholder Services, Inc. (“ISS”), holding that the SEC’s definition of the term “solicit” went beyond the meaning Congress contemplated when enacting Section 14(a) of the Securities and Exchange Act of 1934 (“Exchange Act”). The decision analyzed the SEC’s 2020 amendment to its rules regulating proxy advice to define the term “solicit” / “solicitation” to include the provision of client requested proxy voting advice (“2020 Rule”). The Court struck down the 2020 Rule as unlawful, reasoning that the meaning of “solicit” as Congress intended when it enacted the Exchange Act is to actively seek to obtain proxy authority or votes. The Court concluded that “the ordinary meaning of ‘solicit’ does not include entities that provide proxy voting recommendations requested by others, even if those recommendations influence the requestors’ eventual votes.” Proxy advisory firms like ISS were therefore in the clear when it comes to Section 14(a).Continue Reading Plain Speaking Wins the Day at the D.C. Circuit: Proxy Advisors Are Not Subject to SEC Section 14(a) Solicitation Prohibition Rule

The U.S. Securities and Exchange Commission (SEC) is once again considering a proposal that could exempt certain individuals—known as “finders”—from broker registration requirements when helping small businesses raise capital. The renewed focus, highlighted in the SEC’s Small Business Capital Formation Advisory Committee agenda for July 22, 2025, has reignited discussions that have been ongoing since the initial proposal was introduced in 2020.Continue Reading SEC Revisits ‘Finder’ Exemption: Potential Impacts for Small Businesses and the Capital Markets

The U.S. Securities and Exchange Commission (SEC) has announced significant changes to its confidential filing procedures, aiming to support capital formation and provide greater flexibility for companies planning public offerings. These enhancements, effective as of March 3, 2025, were detailed in a press release by the SEC.Continue Reading SEC to Expand Confidential Filing Privileges

Just over one month into the second Trump Administration, the crypto industry appears poised to notch yet another victory in its longstanding tug-of-war with regulators — perhaps its most significant to date. On February 21, Coinbase Chief Legal Officer Paul Grewal announced via blog post that the U.S. Securities and Exchange Commission (“SEC”) is set to drop its enforcement action against the company. The lawsuit, which claimed that the company had failed to fulfill registration requirements, has been one of the SEC’s highest-profile crypto cases.Continue Reading SEC Withdraws from Prominent Crypto Enforcement Amid Regulatory Shift

On October 10, 2023, the SEC adopted amendments to the rules governing beneficial ownership reporting on Schedules 13D and 13G. While compliance with the amendments to the rules governing beneficial ownership reporting on Schedule 13D went into effect on February 5, 2024, compliance with the revised Schedule 13G filing deadlines set forth below are effective on September 30, 2024.Continue Reading Revised Schedule 13g Filing Deadlines Effective as of September 30, 2024 – What You Need to Know

More than two years after announcing the first round of settlements in the ongoing “off-channel communications” probe, the SEC recently announced another round of settlements with 26 financial firms, totaling $390 million in fines. These most recent settlements are notable for two reasons: (1) they include the SEC’s second settlement with an entity operating solely as a registered investment adviser (“RIA”) with no associated broker-dealer, and (2) the SEC has again explicitly noted that companies that self-reported obtained lower fines.Continue Reading Latest Round of SEC “Off-Channel” Communications Settlements Highlights Risks for Investment Advisers and Benefits of Self-Reporting

Over the last several years, the Securities and Exchange Commission (“SEC”) has been laser-focused on the use of so-called “off-channel communications” in the financial services industry. On the theory that employees’ use of personal devices and platforms (such as WhatsApp) to communicate about business violates the “books and records” requirements applicable to financial institutions, the regulator has conducted intrusive and extensive investigations. To respond to the SEC, many companies have required employees to have their personal cell phones copied and reviewed. Continue Reading What Private Equity Firms Need to Know About the Ongoing SEC Investigation of “Off-Channel” Communications

In Securities & Exchange Commission v. Govil, No. 22-1658, 2023 WL 7137291 (2d Cir. Oct. 31, 2023), the United States Court of Appeals for the Second Circuit dealt a setback to the enforcement agenda of the Securities and Exchange Commission (“SEC”) by limiting its ability to seek disgorgement under 15 U.S.C. § 78u(d)(5) and (7) to situations in which the regulator can demonstrate investors have suffered pecuniary harm.Continue Reading Second Circuit Reins in SEC Disgorgement Powers

The Securities Exchange Commission (“SEC” or “Commission”) has taken action against Genesis Global Capital, LLC (“Genesis”) and Gemini Trust Company, LLC (“Gemini”) (collectively, “Defendants”) in a recently-filed complaint alleging that the crypto companies violated federal securities laws by engaging in the unregistered offer and sale of securities in the form of their “Gemini Earn Agreements.” In doing so, the Commission not only relied upon the mainstay Howey Test for determining whether an agreement is a security, but also summoned Howey’s lesser-known cousin, the Reves Test, notably leading with the latter in its complaint.Continue Reading SEC Showcases Lesser-Known Legal Theory in Crypto Lending Suit

On December 14, 2022, the Securities and Exchange Commission (the “SEC”) adopted amendments to modernize Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and add new disclosure requirements to enhance investor protections against insider trading. Rule 10b5-1, which was adopted in 2000, provides a safe harbor for corporate insiders such as officers and directors to buy or sell company stock without violating insider trading regulations under Section 10(b) of the Exchange Act, and Rule 10b-5, if trades are made pursuant to pre-determined trading plans, also known as Rule 10b5-1 plans, entered into at a time when such parties are not privy to any material nonpublic information.Continue Reading SEC Adopts Amendments Regarding Insider Trading Plans and Related Disclosures