There was a time when even the prospect of an enforcement action by the U.S. Securities and Exchange Commission (SEC) inspired twin emotions – fear and a burning “need” to settle. Indeed, the cost and reputation damage were often judged to be too high to take on the SEC in court, and the Court of Public Opinion. But as the SEC’s resources have grown and the agency has become more aggressive, that dynamic is beginning to break down. With careers on the line, brands in the crosshairs, and litigation outcomes far from certain, defendants have become increasingly bold and willing to go to trial. According to a recent report from Bloomberg’s Joshua Gallu, “The SEC’s office in Washington is actively litigating about 90 cases, up more than 50 percent in the past year.” The increase is driven largely by two factors: a significant uptick in cases brought against individuals in the aftermath of 2008; and an emerging sense among defendants that courtroom victories are actually within reach. Consider that the agency’s trial unit staff has held steady at 36 and not kept pace with the corresponding caseload growth. Consider that SEC litigation resources are being stretched thin at a time when the cases on the SEC’s enforcement docket are as complex and difficult to prove as any in recent memory. Consider that little legal precedent exists in a number of the actions. Finally, add the fact that a U.S. District Judge’s recent rejection of a high-profile SEC settlement forced the agency to toughen its settlement rules in certain cases. Soon it becomes easier to understand why so many targets are opting to fight. At the same time, the SEC’s history of settlements has further emboldened its targets. Mr. Gallu’s piece quotes SEC Enforcement Director Robert Khuzami as saying, “If you don’t have a legitimate trial threat, if you don’t communicate to the targets of your investigation that you’re prepared to go to trial, then you can be exploited.” The ultimate resolution of this tension will not likely be found in the near term. Right now, defendants believe they can beat the SEC. And given all that’s at stake – in the courtroom, and the Court of Public Opinion – it’s no wonder that they continue to explore the very real situations where they can be victorious. Michael W. Robinson is an Executive Vice President at Levick Strategic Communications and a contributing author to Bulletproof Blog®.