United States: Second Circuit Applies Loper Bright to Reject Reliance on SEC Definition of Investment Adviser in Enforcement Action

The SEC has long taken the position that the “expectation” of receiving profits can satisfy the “receipt of compensation” element needed to be an investment adviser. In an important new summary order, and one of the first applying Loper Bright to the SEC, the Second Circuit vacated Advisers Act liability after concluding that courts must independently construe the statutory definition of “investment adviser” rather than defer to the SEC’s interpretation.... By: K&L Gates LLP