Billionaires Elon Musk and Mark Cuban have teamed up to challenge the U.S. Securities and Exchange Commission’s (SEC) practice of conducting in-house trials without juries. They have filed a joint amicus brief to the Supreme Court, questioning the legitimacy of the SEC’s administrative proceedings and their impact on the Seventh Amendment right to a jury trial. The challenge stems from the case of SEC vs. Jarkesy, where plaintiff George Jarkesy argues that his Seventh Amendment rights were violated when the agency used an internal adjudication process led by an administrative law judge appointed by the commission. Musk and Cuban argue that this setup allows a single entity to act as judge, jury, and executioner, raising concerns about impartiality and due process. They highlight that the SEC began handling more cases in-house between 2013 and 2014, diverting from federal courts, after unsuccessful insider trading cases before juries. The fairness of these in-house trials was further called into question when the SEC admitted to personnel wrongly accessing files in various cases, including Jarkesy’s. Additionally, the SEC implemented new regulations in July 2023, requiring public companies to promptly disclose major data breaches, despite internal control deficiencies being identified and reported later. The Justice Department’s Solicitor General, Elizabeth Prelogar, argues that the 5th Circuit’s decision favoring Jarkesy was mistaken and that Congress did not breach the Seventh Amendment by granting the SEC the authority to commence administrative proceedings for civil penalties. Prelogar is urging the Supreme Court to overturn its previous ruling. Musk, who is currently facing a lawsuit with the SEC, and Cuban are appealing to the justices to maintain the decision of the 5th Circuit and argue that opting for administrative proceedings instead of federal court juries goes against the SEC’s mandate and poses risks to investors and the markets. The Supreme Court will review an appeal from the Biden administration on November 29, contesting the 5th U.S. Circuit Court of Appeals’ ruling in support of George Jarkesy.
This News Article was automatically generated by Bob the Bot (AI)
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | |
| Sentiment | neutral |
| Relevance Score | 1 |
| People | Elon Musk, Mark Cuban |
| Companies | Justice Department, Biden administration, Supreme Court, 5th Circuit Court of Appeals, SEC |
| Currencies | None |
| Securities | None |
