After a series of high-profile losses in recent years, the U.S. Securities and Exchange Commission finally prevailed at the Supreme Court, as the justices held that an investment banker who knowingly disseminated false statements to his clients committed securities fraud, even when the banker was not legally deemed to be the “maker” of the misstatements. While it may appear obvious that a securities professional who intentionally deceived investors must have liability, nothing is particularly self-evident under the securities laws. Ironically, in a case concerning the government, the biggest winners may be private plaintiffs and their lawyers, who might be better positioned to bring securities lawsuits in certain situations.

The SEC’s victory in Lorenzo v. Securities and Exchange Commission, No. 17-1077 (March 27), must be a welcome relief for the agency, after the court in recent years has delivered several major setbacks, including decisions imposing a strict five-year limit on the SEC’s ability to bring disgorgement claims and holding that the SEC’s method of appointing in-house administrative law judges was unconstitutional. The justices voted 6-2 in favor of the SEC, with Justice Brett Kavanaugh recusing himself because he had written a dissent in the ruling by the U.S. Court of Appeals for the District of Columbia that was before the Supreme Court.