Altman v. United States Securities and Exchange Commission
687 F.3d 44
2d Cir.2012Background
- Altman, a New York attorney, challenged a lifetime SEC debarment in district court seeking to stay SEC proceedings and vacate the ban.
- SEC imposed a lifetime bar under Rule 102(e)(1)(ii) and 15 U.S.C. § 78d-3(a)(2) for unethical conduct in SEC proceedings.
- Altman alleged due process/equal protection violations and lack of authority, but the district court dismissed for lack of subject matter jurisdiction.
- Section 25(a) of the Exchange Act directs review of final SEC orders in the circuit court where the plaintiff resides or in the D.C. Circuit.
- The district court held that Section 25(a) precludes district-court review and that the exceptions discussed in Touche Ross and Thunder Basin/Free Enterprise Fund do not apply.
- The court affirmed the district court’s dismissal, and Altman subsequently pursued the same challenge in the D.C. Circuit, which affirmed the lifetime ban.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does 25(a) preclude district-court review of the SEC debarment order? | Altman contends 25(a) does not bar district review. | SEC argues 25(a) provides exclusive appellate review. | Yes; 25(a) precludes district-court review. |
| Are Touche Ross or Thunder Basin/Free Enterprise Fund exceptions applicable? | Altman argues exceptions allow district jurisdiction. | SEC argues the exceptions do not apply here. | No; exception not applicable. |
| Must Altman exhaust administrative remedies before seeking review? | Altman relies on non-exhaustive avenues and district court jurisdiction. | Court should follow exhaustion principle per Touche Ross. | Exhaustion required; district court lacked jurisdiction. |
Key Cases Cited
- City of Tacoma v. Taxpayers of Tacoma, 357 U.S. 320 (1958) (general rule: review must be in appellate court; not in district court)
- Touche Ross & Co. v. SEC, 609 F.2d 570 (2d Cir. 1979) (exhaustion principle governs challenges to final SEC decisions)
- Thunder Basin Coal Co. v. Reich, 510 U.S. 200 (1994) (factors for non-exhaustion relevance)
- Free Enterprise Fund v. Pub. Co. Accounting Oversight Bd., 130 S. Ct. 3138 (2010) (factors indicating non-exhaustion viability)
- Altman v. SEC, 666 F.3d 1322 (D.C. Cir. 2011) (D.C. Circuit affirmed lifetime ban after similar challenges)