FedSoc Forums Loper Bright Fallout for SEC Rulemaking?
Jan 23, 2026
01:00:53
In an unprecedented action, the SEC in July dismissed with prejudice a pending enforcement case concerning an alleged violation of a rule promulgated under the Investment Company Act of 1940 (ICA). In 2023, the SEC had charged the defendants (a mutual fund, its investment advisor, and independent directors of the fund) with violating its 2016 “liquidity rule,” which limits the percentage of assets investment companies may hold in "illiquid" investments. The independent directors argued that the ICA did not authorize the SEC to make rules concerning fund liquidity and that its decision to do so based on a protection of investors rationale was owed no deference under the 2024 Supreme Court decision in Loper Bright.
The district court ordered supplemental briefing on Loper Bright implications, but before the SEC filed its supplemental response, it dismissed the case against all defendants, citing “policy reasons”, without more explanation.
Our panelists will discuss the numerous legal and policy issues and questions raised by this sequence of events.
Featuring:
Jan Folena, Partner and Co-Chair of Securities & Regulatory Enforcement, Stradley Ronon
Margaret Little, Senior Litigation Counsel, New Civil Liberties Alliance
(Moderator) Michael Piwowar, Executive Vice President, Milken Institute Finance
The district court ordered supplemental briefing on Loper Bright implications, but before the SEC filed its supplemental response, it dismissed the case against all defendants, citing “policy reasons”, without more explanation.
Our panelists will discuss the numerous legal and policy issues and questions raised by this sequence of events.
Featuring:
Jan Folena, Partner and Co-Chair of Securities & Regulatory Enforcement, Stradley Ronon
Margaret Little, Senior Litigation Counsel, New Civil Liberties Alliance
(Moderator) Michael Piwowar, Executive Vice President, Milken Institute Finance