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Brief Fact Summary. This case was appealed after the SEC reconsidered the same plan from Chenery I, and again rejected it.
Synopsis of Rule of Law.
Whether and to what extent directors or officers should be prohibited from buying or selling stock of the corporation during its reorganization, presents problems of policy for the judgment of Congress or of the body to which it has delegated power to deal with the matter.
View Full Point of Law
Issue. Was the Commission’s action in again outlawing petitioners’ purchases of stocks, considered in the light of the Supreme Court’s opinion, a permissible exercise of administrative discretion?
Held. No. The Commission’s action cannot be sustained on that ground. The Commission’s position amounted to nothing more than saying that purchasing shares of company stock during reorganization is unlawful, without any regard to any other factors or good or bad faith. This is precisely what the Supreme Court said not to do. The Commission cannot apply a standard which it has never promulgated. Dissent. None. Concurrence. None.
Discussion. The Commission’s position goes beyond the mere question of the necessity of a rule to insisting an absolute right to approve in one case, and disapprove in another.