Document ID: ./input/supremecourt_opinions/opinions/19pdf/18-1501_8n5a.pdf
Page Number: 33.0

10 

LIU v. SEC 

THOMAS, J., dissenting 

10, 25–26 (1896).  The majority instructs the lower courts
to determine whether petitioners were “partners in wrong-
doing,”  apparently  based  on  a  case  about  the  liability  of 
partners.  Ante, at 10, 18 (citing Ambler v. Whipple, 20 Wall. 
546 (1874)).  But the liability in that case was premised on 
the law of partnership, and nothing indicates that petition-
ers here were legal partners.  The joint and several order in 
this case is thus at odds with traditional equitable rules.3 

C 
Finally, the award should be used to compensate victims,
not  to  enrich  the  Government.  Plaintiffs  in  equity  may
claim  “that  which,  ex  aequo  et  bono  [according  to  what  is 
equitable  and  good],  is  theirs,  and  nothing  beyond  this.” 
Livingston  v.  Woodworth,  15  How.  546,  560  (1854).    The 
money ordered to be paid as disgorgement in no sense be-
longs to the Government, and the majority cites no author-
ity allowing a Government agency to keep equitable relief
for  a  wrong  done  to  a  third  party.   Requiring  the  SEC  to
only “generally” compensate victims, ante, at 15, is incon-
sistent with traditional equitable principles.

Worse still from a practical standpoint, the majority pro-
vides almost no guidance to the lower courts about how to 
resolve this question on remand.  Even assuming that dis-
gorgement  is  “equitable  relief”  for  purposes  of  §78u(d)(5) 
and that the Government may sometimes keep the money, 

—————— 

3 For its part, respondent cites the joint and several liability in Jackson 
v. Smith, 254 U. S. 586, 589 (1921), but the remedy in that case was a
constructive trust, see Smith v. Jackson, 48 App. D. C. 565, 576 (1919). 
As  explained  above,  there  is  no  tracing  requirement  in  the  District 
Court’s order as would be required in a case of constructive trust.  Supra, 
at 6–7.  The Court also allowed joint and several liability in Belford v. 
Scribner, 144 U. S. 488 (1892), a copyright case.  But it based its holding 
on the fact that, under the relevant copyright statute, “both the printer
and the publisher are equally liable to the owner of the copyright for an 
infringement.”  Id.,  at  507;  see  also  Washingtonian  Publishing  Co.  v. 
Pearson, 140 F. 2d 465, 467 (CADC 1944).