SEC v. Fehn case brief

SEC v. Fehn case brief summary
97 F.3d 1276 (1996)

CASE SYNOPSIS

From an action brought by appellee Securities and Exchange Commission, appellant attorney sought review of a decision of the United States District Court for the District of Nevada, which entered a judgment against appellant, finding that he aided and abetted violations of §§ 10(b), 15(d) of the Securities Exchange Act of 1934, 15 U.S.C.S. §§ 78j(b), 78o(d), and permanently enjoined appellant from future aiding and abetting violations.

CASE FACTS
After an investigation by appellee Securities and Exchange Commission of an initial public offering of securities revealed that a corporation made misstatements and omissions in its registration statement, appellee brought an action against appellant attorney, alleging that he aided and abetted violations of §§ 10(b) and 15(d) of the Securities Exchange Act of 1934, 15 U.S.C.S. §§ 78j(b), 78o(d), and appellee's regulations. The district court found that appellant aided and abetted the violations and entered a permanent injunction against future aiding and abetting violations.

DISCUSSION

• The court affirmed the decision because there was sufficient evidence to prove that appellant knowingly substantially assisted his client in the preparation of the deceptive forms and improperly advised his clients regarding the omissions. 
• The court found that 15 U.S.C.S. § 78t(f) applied retroactively and authorized appellee to seek injunctive relief against appellant because it merely maintained a prior right of appellee that was eliminated by a recent court decision. 
• The court affirmed the injunction because there was no abuse of discretion based upon evidence presented to support the injunction.

CONCLUSION

The court affirmed the findings that appellant attorney aided and abetted violations of securities laws because of sufficient evidence to show that he substantially assisted in material omissions to disclosure forms, and also affirmed the permanent injunction because appellee Securities and Exchange Commission was authorized to seek injunctive relief for future aiding and abetting violations and evidence was adequate to support the injunction.

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