In Law360, Attorneys Examine the U.S. Supreme Court’s Liu v. SEC Decision
In a Law360 article co-authored by litigation & enforcement partner Amy Jane Longo and associates Vito Iaia and Brooke Cohen, the attorneys discuss the implications of the U.S. Supreme Court’s 2020 decision in Liu v. SEC. The decision established that the Securities and Exchange Commission can seek disgorgement “for the benefit of investors,” though many questions about this precedent remain open.
In the two years since Liu, “the case law has largely favored the SEC, deferring to its discretion in identifying harmed investors and approximating net profits,” the authors note. But it has yet to be seen how courts will address a number of related matters, such as whether the SEC can send disgorged funds to the U.S. Department of Treasury, or the parameters of “legitimate business expenses” appropriate for deduction.