In Kokesh v. SEC, the U.S. Supreme Court Held that SEC Disgorgement Is a “Penalty,” with Consequences for Both SEC Enforcement Actions and Corporate Taxpayers

On June 7, 2017, Cravath prepared for its clients a memo entitled “In Kokesh v. SEC, the U.S. Supreme Court Held that SEC Disgorgement Is a ‘Penalty’, with Consequences for Both SEC Enforcement Actions and Corporate Taxpayers.” The memo summarizes the recent unanimous U.S. Supreme Court decision in Kokesh v. Securities and Exchange Commission and its impact. As a result of the decision, the SEC will need to be mindful of the timeliness of its investigations and actions, and make tolling agreements a more significant issue for those subject to investigation. Additionally, although Kokesh concerns disgorgement against an individual and is not a tax case, it will have significant implications for corporate taxpayers relating to the deductibility of disgorgement payments.

Please click here to read the memo.