Document ID: ./input/supremecourt_opinions/opinions/19pdf/18-1501_8n5a.pdf
Page Number: 9

6 

LIU v. SEC 

Opinion of the Court 

Montanile  v.  Board  of  Trustees  of  Nat.  Elevator  Industry 
Health Benefit Plan, 577 U. S. 136, 142 (2016).  The “basic 
contours of the term are well known” and can be discerned 
by  consulting  works  on  equity  jurisprudence.  Great-West 
Life  &  Annuity  Ins.  Co.  v.  Knudson,  534  U. S.  204,  217 
(2002).

These  works  on  equity  jurisprudence  reveal  two  princi-
ples.  First, equity practice long authorized courts to strip 
wrongdoers  of  their  ill-gotten  gains,  with  scholars  and 
courts using various labels for the remedy.  Second, to avoid 
transforming an equitable remedy into a punitive sanction,
courts restricted the remedy to an individual wrongdoer’s
net profits to be awarded for victims. 

A 

Equity  courts  have  routinely  deprived  wrongdoers  of 
their  net  profits  from  unlawful  activity,  even  though  that
remedy may have gone by different names.  Compare, e.g., 
1  D.  Dobbs,  Law  of  Remedies  §4.3(5),  p.  611  (1993)  (“Ac-
counting  holds  the  defendant  liable  for  his  profits”),  with 
id.,  §4.1(1),  at  555  (referring  to  “restitution”  as  the  relief
that  “measures  the  remedy  by  the  defendant’s  gain  and 
seeks to force disgorgement of that gain”); see also Restate-
ment  (Third)  of  Restitution  and  Unjust  Enrichment  §51, 
Comment a, p. 204 (2010) (Restatement (Third)) (“Restitu-
tion  measured  by  the  defendant’s  wrongful  gain  is  fre-
quently called ‘disgorgement.’  Other cases refer to an ‘ac-
counting’  or  an  ‘accounting  for  profits’ ”);  1  J.  Pomeroy, 
Equity Jurisprudence §101, p. 112 (4th ed. 1918) (describ-
ing an accounting as an equitable remedy for the violation 
of strictly legal primary rights).

No matter the label, this “profit-based measure of unjust 
enrichment,” Restatement (Third) §51, Comment a, at 204, 
reflected a foundational principle: “[I]t would be inequitable 
that  [a  wrongdoer]  should  make  a  profit  out  of  his  own 
wrong,” Root v. Railway Co., 105 U. S. 189, 207 (1882).  At