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Page Number: 17

14 

LIU v. SEC 

Opinion of the Court 

SEC could recover in a way that would contravene limita-
tions  embedded  in  the  statute.  After  all,  such  “statutory
reference[s]” to a remedy grounded in equity “must, absent 
other indication, be deemed to contain the limitations upon 
its availability that equity typically imposes.”  Great-West, 
534 U. S., at 211, n. 1.  Accordingly, Congress’ own use of 
the  term  “disgorgement”  in  assorted  statutes  did  not  ex-
pand  the  contours  of  that  term  beyond  a  defendant’s  net 
profits—a  limit  established  by  longstanding  principles  of 
equity. 

III 
Applying  the  principles  discussed  above  to  the  facts  of
this case, petitioners briefly argue that their disgorgement
award  is  unlawful  because  it  crosses  the  bounds  of  tradi-
tional equity practice in three ways: It fails to return funds
to victims, it imposes joint-and-several liability, and it de-
clines  to  deduct  business  expenses  from  the  award.    Be-
cause  the  parties  focused  on  the  broad  question  whether 
any form of disgorgement may be ordered and did not fully 
brief these narrower questions, we do not decide them here. 
We  nevertheless  discuss  principles  that  may  guide  the 
lower courts’ assessment of these arguments on remand. 

A 
Section 78u(d)(5) restricts equitable relief to that which
“may be appropriate or necessary for the benefit of inves-
tors.”  The  SEC,  however,  does  not  always  return  the  en-
tirety of disgorgement proceeds to investors, instead depos-
iting a portion of its collections in a fund in the Treasury. 
See SEC, Division of Enforcement, 2019 Ann. Rep. 16–17, 
https://www.sec.gov/files/enforcement-annual-report-
2019.pdf.  Congress  established  that  fund  in  the  Dodd-
Frank Wall Street Reform and Consumer Protection Act for 
disgorgement  awards  that  are  not  deposited  in  “disgorge-
ment  fund[s]”  or  otherwise  “distributed  to  victims.”  124