The Cato Institute, a libertarian think tank, is suing the Securities and Exchange Commission in federal court to challenge its decades-old policy of imposing “gag orders” on settling defendants in civil enforcement actions.
As a routine condition of settling civil or administrative actions, defendants agree to a promise that they will never publicly contest, challenge, or deny any of the allegations the SEC has made against them—even after the case has been settled and the underlying lawsuit or administrative proceeding dismissed.
