The Securities and Exchange Commission filed a notice on Thursday that it is appealing Southern District Judge Jed S. Rakoff’s decision not to approve the agency’s $285 million proposed settlement with Citigroup. Judge Rakoff (See Profile) rejected the accord last month on the grounds that the SEC failed to present “any proven or admitted facts upon which to exercise even a modest degree of independent judgment” about whether to approve the deal (NYLJ, Nov. 29).
“We believe the district court committed legal error by announcing a new and unprecedented standard that inadvertently harms investors by depriving them of substantial, certain and immediate benefits,” SEC enforcement chief Robert Khuzami said in a statement announcing the decision to appeal to the U.S. Court of Appeals for the Second Circuit.
