News & Analysis as of

Rakoff Rebuffed on Rejection of SEC Settlement

Appeals for the Second Circuit has vacated a provocative order by Southern District of New York Judge Jed Rakoff. In the November 2011 order, Rakoff rejected a proposed "no-admit, no-deny" consent decree to resolve an SEC...more

This Week In Securities Litigation

In the roll-up to the Labor Day weekend, the SEC issued new rules regarding asset backed securities and credit rating agencies. The Commission also announced a new pilot program on tick size....more

Judge Rakoff’s “Sour Grapes”: SEC v. Citigroup Settlement Approved

On August 5, 2014, U.S. District Judge Jed Rakoff reluctantly approved a$285 million settlement in the SEC’s enforcement action against Citigroup. In SEC v. Citigroup, the SEC alleged that after Citigroup realized in early...more

Judge Rakoff Approves SEC’s $285M Settlement With Citigroup

On remand following a Second Circuit decision vacating his June 2011 rejection of a settlement between Citigroup and the SEC, Judge Jed Rakoff of the Southern District of New York approved the settlement, finding that it met...more

This Week In Securities Litigation (Week ending August 1, 2014)

The Commission continued to focus on the markets this week, brining another action involving the operation of a partially dark pool. The ECN operator was a subsidiary of Citigroup. The SEC alleged that confidential customer...more

SEC Charges ECN Operator For Failing To Protect Customer Data

Fragmented markets, alternative trading systems and dark pools are increasingly a focus of discussion in the wake of repeated market outages. Interest in these venues has been intensified by the publication of Flash Boys and...more

Second Circuit Overturns District Court’s Rejection of SEC-Citigroup Fraud Settlement

In a closely-watched decision involving judicial review of agency settlements, the Unites States Court of Appeals for the Second Circuit vacated United States District Court Judge Jed Rakoff’s 2011 order rejecting a proposed...more

The Second Circuit And The Separation Of Powers: Limiting Judicial Scrutiny Of SEC Settlements

On June 4, 2014, a three-judge panel of the Second Circuit Court of Appeals vacated a widely publicized 2011 decision by U.S. District Judge Jed Rakoff, which rejected a settlement between the U.S. Securities and Exchange...more

Second Circuit Overturns Lower Court's Refusal to Approve SEC Settlement With Citigroup

In an eagerly anticipated decision, the U.S. Court of Appeals for the Second Circuit vacated the 2011 decision of Judge Jed S. Rakoff of the U.S. District Court for the Southern District of New York, rejecting a proposed...more

Second Circuit Upholds "Neither Admit Nor Deny"

On June 4, 2014, the United States Circuit Court for the Second Circuit endorsed the Securities and Exchange Commission's practice of settling enforcement cases on a "neither admit nor deny" basis. In its order issued in SEC...more

Second Circuit Clarifies Standard For Reviewing Enforcement Agency Consent Judgments

On June 4, the U.S. Court of Appeals for the Second Circuit vacated and remanded a district court’s decision to reject a proposed settlement between the SEC and a financial institution in a securities fraud suit. SEC v....more

Second Circuit Vacates Judge Rakoff’s Rejection of SEC Settlement: Consent Decree “Fair and Reasonable” Even Without Admission of...

D&O insurers should be mindful of a recent development in the Second Circuit that could have implications for D&O insurers. The developments stem from a key decision in the Southern District of New York in 2011. On November...more

Five Questions and Answers About the Second Circuit’s SEC v. Citigroup Decision

Last week we posted a summary of the Second Circuit’s decision in SEC v. Citigroup Global Markets, Inc. This week, as a follow-up, we pose the following five “yes or no” questions and provide responses as a way to further...more

Second Circuit upholds broad SEC settlement powers - for potential defendants, 3 key points

The United States Court of Appeals for the Second Circuit has found that Judge Jed S. Rakoff of the District Court for the Southern District of New York abused his discretion in refusing to approve a settlement between the...more

The Second Circuit Confirms the SEC’s Ability to Settle Without Requiring Admissions of Wrongdoing

In November 2011, Judge Jed Rakoff of the Southern District of New York ignited a firestorm of commentary and concern among the securities bar by declining to approve a settlement between the SEC and Citigroup in which the...more

Deference and Compromise Reigns over Establishment of Truth: Second Circuit Validates SEC Use of "Neither Admit Nor Deny"...

On June 4, 2014, the Second Circuit Court of Appeals vacated U.S. District Judge Jed Rakoff’s influential and controversial decision to reject a consent injunction between the SEC and Citigroup Global Markets Inc. (Citigroup)...more

Orrick's Financial Industry Week in Review

FMLC Publishes Response on Bail-in Powers - In response to a consultation by HM Treasury, the UK's Financial Markets Law Committee (FMLC) published a letter on June 4 relating to the bail-in powers introduced by the...more

Second Circuit Vacates Judge Rakoff’s Ruling Rejecting SEC-Citigroup Settlement

On June 4, the U.S. Court of Appeals for the Second Circuit vacated a November 28, 2011, decision of the U.S. District Court for the Southern District of New York in which the district court declined to approve a settlement...more

U.S. Appellate Court Overturns Decision Rejecting SEC’s No-Contest Settlement

The United States Court of Appeals for the Second Circuit held on June 4, 2014 that the U.S. Southern District Court of New York “abused its discretion” when it refused to approve a “no-contest” settlement agreement between...more

Second Circuit Vacates Judge Rakoff’s Order Refusing to Approve Citigroup “Neither Admit Nor Deny” Settlement

On June 6, 2014, the Second Circuit Court of Appeals vacated Judge Rakoff’s order refusing to approve a settlement between the SEC and Citigroup in which Citigroup neither admitted nor denied the agency’s allegations. See SEC...more

The Securities and Exchange Commission (“SEC”) Prevails in the Second Circuit in Defending Its No-Admission Settlement Policy

The long legal battle over the SEC’s neither-admit-nor-deny settlement policy has finally come to an end. On June 4, 2014, the Second Circuit issued an opinion vacating the district court’s rejection of a proposed consent...more

Second Circuit Reverses SDNY In SEC-Citigroup Settlement Case

On June 4, 2014, the United States Court of Appeals for the Second Circuit vacated and remanded a November 28, 2011 order from the United States District Court for the Southern District of New York refusing to approve a...more

Second Circuit Says Wall Street Can Play “Truth or Settle”

On June 4, 2014, a three-judge Second Circuit panel reversed and remanded Judge Rakoff’s 2011 order that rejected an S.E.C. settlement with Citigroup. The proposed settlement resolved the S.E.C.’s securities fraud case...more

Second Circuit’s Citigroup Decision Protects SEC’s Discretion in Settling Enforcement Cases

Wednesday’s decision by the U.S. Court of Appeals for the Second Circuit in the Citigroup case is significant because it clarifies the standards for judicial review of consent decrees in SEC enforcement proceedings and...more

Second Circuit Says Pragmatism Trumps “Cold, Hard” Facts, Limits District Courts’ Powers in Reviewing SEC Settlements

Summer is coming, but this is probably not the vacation Southern District of New York Judge Jed Rakoff had in mind. On June 4, 2014, the Second Circuit vacated Judge Rakoff’s order refusing to approve the SEC’s $285 million...more

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