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Circuit Court Case Analysis

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In regards to the question of whether the SEC has departed from the rulings of Circuit Courts as it did in 2014 in In the Matter of Flannery and Hopkins, the answer is that the SEC has a history of non-acquiescence with the rulings of the Circuit Courts.

In 1963, in response to a decision by the Second Circuit, Grayson-Robinson Stores, Inc. v. SEC, 320 F.2d 940 (2nd Cir. 1963), the Commission released a “Statement of Nonacquiescence,” stating its hostility toward the Second Circuit’s ruling and began re-litigating the issues underlying the case both in and outside the Second Circuit refusing to treat the Second Circuit’s decision as dispositive. The SEC continued to refuse to follow the Second Circuit’s ruling in Grayson until the Supreme …show more content…
17, 2015) stated that it did not believe that D.C. Circuit’s ruling that the 28 U.S.C. § 2462 statute of limitations applied to bars on past misconduct as penalties was correct and that the agency would not follow this decision outside the D.C. Circuit. To support its decision, the SEC cited to Indep. Petroleum Ass’n of Am. V. Babbitt, 92 F.3d 1248, 1260 (D.C. Cir. 1996), which recognizes that administrative “agencies have the power of nonacquiescence in decisions of a single circuit.” The SEC has continued this course in its enforcement actions, like In the Matter of Spring Hill Captial Markets, LLC et al., Initial Decision Release No. 919, pg. 4 (ALJ Nov. 30, 2015). Timbervest is currently being appealed to the D.C. Circuit.

The Supreme Court in its decision in United States v. Mendoza, 464 U.S. 154, 160 (1984) seems to lend support to the SEC’S actions. In Mendoza, the Court recognized that nonmutual collateral estoppel, which would prevent the SEC from relitigating the same issue with different parties, does not apply to government entities. Therefore, the SEC is free to litigate an issue in multiple forums and relitigate an issue in the same forum even if a Circuit Court has already ruled in the

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