Eleventh Circuit Ties SEC Disgorgement to Five-Year Statute of Limitations

The FCPA Blog

In this blog post, Marc Alain Bohn discusses the recent Eleventh Circuit decision in SEC. v. Graham, which found that the five-year statute of limitations in 28 USC §2462 applies to U.S. Securities and Exchange Commission (SEC) claims for disgorgement or declaratory relief. "Although Graham is not binding outside of the Eleventh Circuit, it represents a significant challenge to the SEC's stated position that disgorgement is not subject to the U.S. Code's general statute of limitations established by §2462 because it is an equitable remedy," Bohn said.

"Graham is a body blow to the SEC's current view of its enforcement powers, particularly if its reasoning is adopted by other circuit courts or if the U.S. Supreme Court affirms the decision," he said. "Because of the decision's potentially significant impact on SEC enforcement strategies, the SEC is likely to seek review by the Supreme Court."

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