# kaal:claim:2150377-004

**Claim.** Before Dodd-Frank the perimeter of hedge fund regulation was set by SEC no-action letters on client counting and by courts that gave very limited and sometimes contradictory guidance, so compliance rested on an unstable and uncertain base rather than on rules.

**Type.** failure  **Support.** argued

**Holds when.**

- the period between the 1968 Merrill Lynch action and the 1985 safe harbor rule
- advisers seeking to stay exempt from securities regulation

**Source quote.**

> However, the SEC continued to provide guidance mostly in the form of no-action letters to help investment advisers determine the counting of clients to stay exempt from securities regulation.44 Courts also provided very limited and sometimes contradictory guidance.45

**From.** Wulf A. Kaal, *Hedge Fund Manager Registration Under the Dodd-Frank Act* (2012), A. Attempts To Register Hedge Funds

**Cite as.** Wulf A. Kaal, Hedge Fund Manager Registration Under the Dodd-Frank Act (2012). SSRN: https://ssrn.com/abstract=2150377

**Verify.** sha256 of source PDF `0b58bb409cac7674d78515f5374096f9a349de3bbd1983c990e0edc85a635a09` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202012%20-%20Hedge%20Fund%20Manager%20Registration%20Under%20the%20Dodd-Frank%20Act.pdf

**Failure mode.** guidance-by-no-action-letter  (family: definitional-ambiguity)

**Topics.** law-and-legal-systems, securities-law, private-funds

**Keywords.** no-action-letters, legal-uncertainty, sec-guidance, client-definition, hedge-fund-regulation

**Related claims.**

- specializes: https://wulfkaal.github.io/claims/1806252-018

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