Elon Musk and Mark Cuban have filed a joint amicus brief to the Supreme Court, challenging the Securities and Exchange Commission’s (SEC) use of in-house trials without juries. They argue that these administrative proceedings lead to unequal outcomes for defendants and potentially violate the right to a jury trial as outlined in the Seventh Amendment. The case at the center of this challenge is SEC v. Jarkesy, where plaintiff George Jarkesy claims his Seventh Amendment rights were violated by the SEC’s internal adjudication process. Musk and Cuban point out that the SEC shifted to handling more cases in-house after unsuccessful insider trading cases before juries. However, this method has faced issues, including the wrongful access of files by SEC personnel. Despite this, the SEC introduced new regulations for public companies related to data breaches. On the other side of the argument, Justice Department Solicitor General Elizabeth Prelogar disagrees with the 5th Circuit’s ruling in favor of Jarkesy and believes Congress did not violate the Seventh Amendment. Musk is also facing legal challenges from the financial watchdog regarding his takeover of Twitter and his public statements about it. Musk and Cuban’s lawyers argue that choosing administrative proceedings over federal court juries contradicts the SEC’s mission and could harm investors and markets.
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