Assume that the securities and exchange commission

Assignment Help Other Subject

Reference no: EM13284663

Assume that the Securities and Exchange Commission (SEC) has a rule under which it enforces statutory provisions prohibiting insider trading only when the insiders make monetary profits for themselves. Then the SEC makes a new rule, declaring that it has the statutory authority to bring enforcement actions against individuals even if they did not personally profit from the insider trading. The SEC simply announces the new rule without conducting a rulemaking proceeding. A stockbrokerage firm objects and says that the new rule was unlawfully developed without opportunity for public comment. The brokerage firm challenges the rule in an action that ultimately is reviewed by a federal applellate court. Using the information presented in the chapter, answer the following questions:

1. Is the SEC an executive agency or an independent regulatory agency? Does it matter to the outcome of this dispute? Explain.

2. Suppose the SEC asserts that it has always had the statutory authority to pursue persons for insider trading regardless of whether they personally profited from the transaction. This is the only argument the SEC makes to justify changing its enforcement rules. Would a court be likely to find that the SEC's action was arbitrary and capricious under the Administrative Procedures Act? Why or why not?

3. Would a court be likely to give Chevron deference to the SEC's interpretaion of the law on insider trading? Why or why not? Use the Mayo Foundation case for support of your answer.

Reference no: EM13284663

Questions Cloud

Under the statute of frauds-oral contracts are void : Under the Statute of Frauds, oral contracts are void. A contract that by its own terms cannot be performed within a year must be in writing to be enforceable. A contract must be in writing to be enforceable if it makes performance possible only over ..

Ideology-practice of community policing-legalistic style : Compare and contrast the ideology and practice (style) of community policing with the legalistic style of policing. In your comparison argue which style policing and its ideology and/or methodology in your opinion is more correct and why. Be prepared..

What is the inventory turnover : If a firm's cost of goods sold is $2.5 million and its average inventory is $500,000 what is the inventory turnover?

How might the definition of quality apply to an organization : How might the definition of quality apply to an organization you know? Provide examples of consumers, external customers and internal customers, and ways in which their expectations can be met or exceeded. Do you feel the organization is applying the..

Assume that the securities and exchange commission : Assume that the Securities and Exchange Commission (SEC) has a rule under which it enforces statutory provisions prohibiting insider trading only when the insiders make monetary profits for themselves. Then the SEC makes a new rule, declaring that it..

Political micro-targeting signals dehumanization of politics : Political micro-targeting signals the dehumanization of politics.

A single polystyrene molecule : A single polystyrene molecule is contained in a 1 mm3 box at a density of 0.969 g/cm3. a) What is the polymer molecular weight? b) What is the length of the chain when it is completely stretched (assuming a repeat unit length of 0.254 nm)?

Theory of negligence or strict liability : Architect Bob Berryman purchased a late model car from Fred's Ford dealership. Three months after he purchased the car, he had to replace two of the tires because he ran over nails at one of his construction sites.

Elements of the marketing mix affects the development : Select an organization in which you are familiar and describe how each one of the four elements of the marketing mix affects the development of the organization's marketing strategy and tactics.

User Account

All Pages