The 2004 registration rule failed in court because the term client was not defined in the Investment Advisers Act, leaving the SEC without authority to fix its meaning, and the D.C. Circuit vacated the rule in Goldstein as arbitrary rulemaking.
Source quote, verbatim
Because the term "client" had not otherwise been defined in the Investment Advisers Act, the SEC had no authority to determine the meaning of the term.
From
Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017), II.2 Evolution of the Investment Advisers Act Exemption, p. 10 https://ssrn.com/abstract=2998097 · source PDF
Cite as
Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097
Holds when
United States
Goldstein v. SEC, July 2006
Classification
failuresupport: arguedfailure: Undefined statutory term defeats agency rulemakingfamily: definitional-ambiguitysecurities-lawprivate-fundsdynamic-regulation
Related claims
restateskaal:claim:2714974-006 The SEC's 2004 hedge fund adviser registration rule failed in court because the agency lacked authority to def...
restateskaal:claim:2150377-006 The SEC's 2004 attempt to reach hedge fund advisers failed as a matter of administrative law: in July 2006 the...
extendskaal:claim:2739479-002 The SEC's 2004 attempt to require hedge fund adviser registration failed: after the D.C. Circuit vacated the r...
extendskaal:claim:2732915-008 After the D.C. Circuit vacated the SEC's 2004 hedge fund adviser registration rule in Goldstein v. SEC, the ov...
Verify
The quote above is an exact substring of the source PDF, whose sha256 is 0955054f49c7011d33c285579bb046e6b284e42755b10fd2546a728c202669d5. Extraction method: pdf-text-layer. Attestation record: colloquium/attestations/9a6736e60595723a...json Verify the binding yourself: curl -s https://wulfkaal.github.io/claims/2998097-002.md | sha256sum