Latest 2 Cases This Week: Whitehead v. BBVA Compass Bank (11th Cir.), Saad v. Securities and Exchange Commission (D.C. Cir.)

Update on Trump’s Coup: Do Not Think That This Is Guaranteed to End Well

NEIL H. BUCHANAN

UF Levin College of Law professor Neil H. Buchanan explains why “being patient with Trump” is a recipe for disaster, why there are still reasons to be guardedly optimistic, and why this all could still end very badly. Buchanan argues that the present situation is not guaranteed end badly, but he cautions that a Trump coup is eminently possible.

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Whitehead v. BBVA Compass Bank

Court: US Court of Appeals for the Eleventh Circuit

Docket: 19-11821

Opinion Date: November 6, 2020

Judge: Ray

Areas of Law: Professional Malpractice & Ethics, Securities Law

The Eleventh Circuit affirmed the district court's grant of summary judgment for appellees in an action brought by appellant, alleging claims for securities fraud and state common law claims of negligence, breach of fiduciary duty, suppression and fraud. Appellant alleged that appellees wrongfully failed to inform appellant of the risks involved in making a certain investment. The court found that the alleged wrongful conduct of appellees did not cause the economic loss for which appellant sues. In this case, there is no viable claim against appellees; no act or omission asserted against them was the cause of the loss suffered by appellant; and thus the district court properly granted summary judgment in their favor.

Saad v. Securities and Exchange Commission

Court: US Court of Appeals for the District of Columbia Circuit

Docket: 19-1214

Opinion Date: November 6, 2020

Judge: David S. Tatel

Areas of Law: Professional Malpractice & Ethics, Securities Law

Petitioner, a broker-dealer, twice misappropriated his employer's funds and then unsuccessfully tried to cover his tracks by falsifying documents. FINRA permanently barred him from membership and from associating with any FINRA member firm. The DC Circuit held that the Supreme Court's recent decision in Kokesh v. SEC, 137 S. Ct. 1635 (2017), which held that SEC disgorgement constitutes a penalty within the meaning of 28 U.S.C. 2462, does not have any bearing in petitioner's case. The court explained that binding circuit precedent establishes that the Commission may approve expulsion not as a penalty but as a means of protecting investors. In this case, the Commission did precisely that. Because this court has already held that the Commission appropriately concluded that petitioner's bar was not excessive or oppressive in any other respect, that ends the court's inquiry.