Court Opinion

ID: 8972313
Source: CourtListenerOpinion
Date Created: 2022-11-27 10:42:43.099229+00
Date Added: 2024-06-11T17:10:28.938580
License: Public Domain

FAIRCHILD, Senior Circuit Judge,
concurring.
I agree that the SEC’s no-action letter is not reviewable.
I am not, however, persuaded that a determination that the System is not an exchange is an essential step in the registration of Delta as a clearing agency. The System, as Judge Easterbrook points out, “is neither fish nor fowl, neither an exchange after the pattern of the Board of Trade and the New York Stock Exchange nor an over-the-counter market after the fashion of the NASDAQ. Developments in automation and communications are bound to produce more of these hard-to-classify entities. Section 3(a)(1) is a product of the ’30s, the System a product of the ’80s.”
It seems arguable that the SEC should have the benefit of observation during a reasonable period of actual functioning of this novel apparatus before being forced to decide whether it fits within the somewhat elastic definition of exchange, and seems arguable that the requirement of “capacity ... to comply” should be interpreted flexibly enough to allow accommodation of that need. My concurrence in the vacation of the Delta registration is grounded only on the SEC’s failure to express an adequate reason for not determining whether the System is an exchange.