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    Home /  Insights /  Memos, Newsletters And Alerts /  Memo
    S&C Memos

    Supreme Court: SEC Fraud Actions for Civil Penalties Must Be Brought in Federal Court

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    June 28, 2024

    Court Holds that Defendants Have Seventh Amendment Right to Jury Trial in Fraud Actions Brought by SEC Under Securities Act, Exchange Act and Advisers Act

    The U.S. Supreme Court ruled yesterday in Securities and Exchange Commission v. Jarkesy that, absent the defendant’s consent, the SEC must bring securities-fraud actions seeking civil penalties before a federal court, rather than before the agency’s in-house adjudicators. In a 6-3 decision authored by Chief Justice Roberts, the Court affirmed the Fifth Circuit’s decision, holding that the Seventh Amendment entitles defendants to a jury trial and that the “public rights” exception to the Amendment does not apply.

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