Will Supreme Court Review Reshape SEC's Enforcement?

Securities Enforcement & Litigation partner Christian Schultz was quoted in the recent Pensions & Investments article "SEC faces murky future on in-house enforcement cases," which discusses the U.S. Supreme Court agreeing to review Jarkesy vs. SEC, a case questioning the constitutionality of the SEC's use of administrative law judges (ALJs) for internal enforcement proceedings. This follows a May 2022 Fifth U.S. Circuit Court of Appeals ruling that found the ALJ system unconstitutional.

Schultz, former Assistant Chief Litigation Counsel in the SEC's Division of Enforcement, expressed that the current composition of the Supreme Court might not be favorable towards the ALJ process. His statement underscores the anticipation that the court might pass a judgment against the SEC, leading to potential changes in enforcement procedures within the commission and similar federal agencies.

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