Joseph John VanCook, Exchange Act Rel. 59550, March 10, 2009
Summary
VanCook has appealed an ALJ's initial decision. He filed his final reply brief on October 21, 2009, together with a motion to stay the proceeding. The Commission has charged in federal court an investment adviser, Simpson Capital, in connection with a mutual fund late trading scheme. According to VanCook, two registered reps at Simpson placed those trades with his firm. VanCook argued in his motion that the Commission cannot fairly rule on his appeal because to rule in his favor would conflict with the Commission's position in the Simpson litigation. VanCook is not a party to that case.
The Commission deemed VanCook's motion to be a motion under Rule 161 for a discretionary postponement or adjournment of the proceeding. In denying the motion the Commission noted that the Supreme Court in Withrow v. Larkin, 421, U.S. 35 (1975) had ruled that combining prosecutorial and adjudicative functions in a single administrative body did not violate due process. It also noted Blinder, Robinson v. SEC, 837 F.2d 1106 (D.C. Cir. 1988) noted a presumption that the SEC will carry out its combined prosecuting and adjudicating responsibilities appropriately.
Comment
Given the strong precedent the Commission decision is not surprising. It is surprising that it took 4 months and 20 days to issue this opinion. The Commission needs to allocate appropriate resources to its opinion writing function so that proceedings are not delayed by almost five months by such routine motions. Otherwise, respondents who wish to delay a final adjudication will have an incentive to file such non-substantive motions.
