Eversheds Sutherland 11th Circuit Business Blog
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Securities Private Offering Exemption Applies in SEC Enforcement Action

The Eleventh Circuit rejected the SEC’s narrow construction of registration exemptions in SEC v. Levin, 2017 WL 711018 (Feb. 23, 2017), reversing a grant of summary judgment to the defendant but still affirming a jury verdict for securities fraud on multiple counts.  The defendant, George Levin, invested his personal funds in a Ponzi scheme that operated by soliciting investors to...

Securities Law Judgment Excepted from Discharge

On the same day the court decided Appling (below), the Eleventh Circuit issued a second bankruptcy-discharge opinion, this time addressing one of the more obscure exceptions from discharge, § 523(a)(19)(A)’s exception for judgments for securities law violations. Lunsford v. Process Technologies Services, LLC (In re Lunsford), 2017 WL 603845 (11th Cir. Feb. 15, 2017).  Judge Bill Pryor...

Supreme Court to Decide Circuit Split on Statute of Limitations for SEC Disgorgement Claims

This past Friday, the Supreme Court granted certiorari in Kokesh v. SEC, No. 16-529 (cert. granted Jan. 13, 2017), to review a circuit split on whether the SEC’s claims for disgorgement are limited to a five-year statute of limitations.  28 U.S.C. § 2462 places a five-year statute of limitations on any “action, suit or proceeding for the enforcement of any civil fine, penalty, or...

Stock Issuer Not Required to Disclose Hiring of Outside Promoters

In the first published appellate court decision to decide the issue, the Eleventh Circuit has held that companies that retain promoters to publish promotional materials to “recommend” or “tout” their stock (and raise the stock price) are not required by federal securities laws to disclose the business arrangement between the issuing company and promoter.  In Ballesteros v. Galectin...

Ask Not for Whom the Securities Exchange Act’s Statute of Repose Tolls; It Doesn’t.

Is a statute of repose subject to tolling? Although its holding was limited to the applicability of American Pipe tolling, created by the commencement of a class action, to the five-year statute of repose under Section 20(a) of the Securities Exchange Act of 1934, the Eleventh Circuit discussed the issue in broad terms in its August 10 opinion in Dusek v. JPMorgan Chase & Co., 832...

Eleventh Circuit Limits SEC’s Claims for Declaratory Judgment and Disgorgement to Five-Year Statute of Limitations

Unless otherwise provided by law, 28 U.S.C. § 2462 ordinarily requires the government to bring any “action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture” within five years of the claim’s accrual. In SEC v. Graham, 2016 WL 3033605 (11th Cir. May 26, 2016), the Eleventh Circuit held that this statute of limitations barred claims asserted by the...