Channeling Marie Kondo, the Tenth Circuit Court of Appeals recently attempted to tidy the mess created by the conflict between the Supreme Court's 2010 decision in Morrison v. National Australia Bank Ltd. and Congress's passage a month later of amendments to the federal securities laws in the form of the Dodd-Frank Wall Street Reform & Consumer Protection Act. The Tenth Circuit's January 24, 2019 opinion, SEC v. Scoville, is a quiet rejection of Morrison's standard in favor of the pre-2010 "conduct and effects" test. While the Tenth Circuit's goal of providing clarity to a muddy area of law is laudable, Scoville ultimately leaves as many questions as answers and - maybe this was the point - more or less begs either the Supreme Court of Congress (but hopefully not both simultaneously) to revisit an important issue of securities law.
The Tenth Circuit's January 24, 2019 opinion, SEC v. Scoville, is a quiet rejection of Morrison's standard in favor of the pre-2010 "conduct and effects" test. While the Tenth Circuit's goal of providing clarity to a muddy area of the law is laudable, Scoville ultimately leaves as many questions as answers and - and maybe this was the point - more or less begs either the Supreme Court or Congress (but hopefully not both simultaneously) to revisit an important issue of securities law.