Thursday’s private conference will mark the justices’ first consideration of Powell v. SEC, a petition attacking the agency’s former “no-deny” settlement rule as a First Amendment violation.
From 1972 until May 2026, the SEC required settling defendants not to publicly deny its allegations and could reopen cases if they did, a policy challengers say coerced speech waivers in a system where 98% of targets settle.
The SEC denied a rulemaking petition in January 2024, and the 9th Circuit rejected the challengers in August 2025, saying constitutional objections were better suited to as-applied cases than a facial attack.
May’s rescission now frames the threshold fight: Solicitor General D. John Sauer says the case is moot because the rule is gone, while challengers argue the late reversal shows the issue merits review and could recur.
When an agency scraps a challenged rule, is the legal fight over or is a final court ruling needed to prevent its return?
If courts limit accountability for rights violations, will Congress create new paths for citizens to seek justice?
How will new standards for proving vote dilution reshape the drawing and challenging of electoral maps across the country?
SEC Rescinds "No-Deny" Policy: Implications of the 2026 Rule 202.5(e) Reversal for Settlements, Free Speech, and Enforcement Strategy
Overview
On May 18, 2026, the SEC abruptly rescinded its long-standing 'no-deny' policy, fundamentally shifting how enforcement settlements are handled. This change immediately reshaped the landscape of SEC settlements and altered the agency’s approach to public accountability. The new policy allows settling parties to publicly deny allegations, making public discussion around SEC settlements more vocal. While some worry this could make settlements harder to achieve or lead to tougher settlement terms, others believe the change may not significantly impact negotiations. Overall, the SEC’s move marks a major transformation in how cases are resolved and discussed.