Case File: Ongkaruck Sripetch, Petitioner v. Securities and Exchange Commission
Case No: 25-466
Court: Supreme Court of the United States, on writ of certiorari to the U.S. Court of Appeals for the Ninth Circuit
Decided: June 4, 2026
Amount Sought by the SEC: More than $4.1 million in disgorgement
Vote: 9-0, unanimous — opinion by Justice Gorsuch, separate concurrence by Justice Thomas
Holding: A showing of pecuniary loss to investors is not required before the SEC may obtain a disgorgement award
A defendant tried to argue that if nobody could prove investors actually lost money, the government shouldn’t be allowed to take his profits away. Nine justices disagreed with him, and the ruling just made life considerably easier for SEC enforcement attorneys nationwide.
The case is Sripetch v. SEC, and it resolves a question that had split federal appeals courts for years: does the Securities and Exchange Commission have to prove someone actually lost money before a court can order a wrongdoer to hand over the profits from securities fraud?
How the Case Started
Ongkaruck Sripetch ran what the SEC described as a series of fraudulent schemes touching at least 20 penny-stock companies. Several followed a familiar pattern known as “pump and dump” — quietly accumulate cheap shares, promote the stock to drive the price up, then sell before the price collapses, leaving later buyers holding shares worth a fraction of what they paid.
The SEC brought a civil enforcement action against Sripetch, charging him with six counts of securities fraud and one count of selling unregistered securities. Rather than fighting the underlying liability, Sripetch consented to the entry of judgment against him and agreed the court could order disgorgement as part of that judgment.
What he didn’t agree to was the amount. Once the SEC came back seeking more than $4.1 million, Sripetch objected, arguing the agency hadn’t shown his conduct caused investors any actual financial loss — and without proven losses, he argued, there were no genuine “victims” for the disgorgement to be awarded on behalf of.
The Legal Fight Over the Word “Victims”
Sripetch’s argument leaned on a 2020 Supreme Court case, Liu v. SEC, which had ruled that SEC disgorgement must be “awarded for victims” rather than simply handed over to the U.S. Treasury as a general penalty. His position was straightforward: if the SEC can’t point to anyone who lost money, it can’t point to any “victims” either, and the whole basis for disgorgement falls apart.
The district court sided with the SEC on the facts, concluding investors had, in fact, suffered pecuniary loss, and never had to resolve the broader legal question of whether such a showing was required in the first place.
On appeal, the Ninth Circuit went further, ruling directly on that broader question: a finding of pecuniary harm, it held, is not required before a court orders disgorgement. That decision put the Ninth Circuit in direct conflict with the Second Circuit, which had previously required the SEC to prove investor losses in a separate case — a split between federal appeals courts significant enough that the Supreme Court agreed to step in and resolve it.
What the Supreme Court Decided
Writing for a unanimous Court, Justice Neil Gorsuch grounded the ruling in a distinction between two different kinds of legal remedies: damages and disgorgement.
Damages exist to compensate someone for a loss they actually suffered, restoring them to the position they would have been in without the wrongdoing. Disgorgement serves a different purpose entirely — it strips a wrongdoer of gains obtained unfairly, independent of whether anyone else can point to a specific financial loss.
The opinion walked through a series of older cases to illustrate the principle, including a dispute where a coal company exceeded the terms of a railroad easement crossing someone else’s land. The landowner admitted he’d suffered barely any inconvenience from the extra rail traffic, yet the court still ordered the coal company to pay over the value of the benefit it had wrongfully taken. The point, Justice Gorsuch wrote, is that someone whose legally protected rights were violated can be entitled to a wrongdoer’s gains from that violation “even when he has suffered no measurable loss whatsoever.”
Applying that principle, the Court held that an investor can count as a “victim” entitled to disgorgement simply by showing their legally protected interests were violated — proving an actual dollar loss isn’t part of the test.
Justice Thomas’s Separate Warning
Every justice agreed with the bottom-line outcome, but Justice Clarence Thomas used a concurring opinion to raise a much larger question the majority chose not to answer: whether disgorgement should still be treated as an “equitable” remedy decided by a judge, or whether it has effectively become a legal penalty that defendants are entitled to have a jury decide instead, under the Seventh Amendment.
Thomas pointed to how Congress has restructured securities law since the Court’s 2020 Liu decision, arguing the changes have pushed disgorgement further away from its traditional equitable roots. He backed the argument with a pointed statistic: in 2024 alone, the SEC secured disgorgement orders totaling $6.1 billion, yet only about $345 million of that actually reached harmed investors — a gap Thomas suggested looks less like restoring money to victims and more like the government collecting a fine for itself.
The majority opinion didn’t weigh in on that broader structural question, leaving it unresolved for a future case.
What Changes Now
For the SEC, this ruling eliminates a defense that fraud defendants had been raising with increasing frequency: arguing that without proof of specific, provable investor losses, there was nothing left for the agency to disgorge. That argument no longer works as a standalone way to block a disgorgement award.
The ruling isn’t unlimited, though. The Court made clear the SEC still must tie any disgorgement amount to the defendant’s actual net profits from the wrongdoing, connected directly to the unlawful conduct, rather than simply claiming a broader figure. The Court also left open a more aggressive question the SEC has raised in other cases: whether disgorgement funds that aren’t feasible to distribute back to investors can simply be kept by the government outright. That question, along with the jury-trial issue Justice Thomas flagged, remains for a future case to settle.
Why This Case Matters Beyond Sripetch
Securities law attorneys tracking SEC enforcement have described this decision as a meaningful widening of the agency’s leverage. Defendants facing SEC fraud allegations can no longer rely on the absence of proven investor losses as a guaranteed way to block or shrink a disgorgement demand, so long as the underlying conduct interfered with investors’ legally protected interests and produced an unjust financial gain.
At the same time, legal commentary following the ruling has flagged Justice Thomas’s concurrence as the detail worth watching most closely going forward. If a future case picks up his argument and a majority of the Court agrees, the entire structure of how SEC disgorgement cases get decided — judge alone, or judge plus jury — could be headed for a far bigger shake-up than this ruling alone delivered.
SOURCE:
This article was prepared using publicly available material concerning Sripetch v. SEC, No. 25-466, including the Supreme Court’s own published opinion and concurrence, and legal analysis from Foley Hoag, Crowell & Moring, the National Law Review, Paul Hastings, Greenberg Traurig, Nelson Mullins, and the American Bankers Association’s Banking Journal. The Supreme Court’s opinion was used to confirm the exact case facts, the $4.1 million figure sought by the SEC, the circuit split the ruling resolved, and the full text of both Justice Gorsuch’s majority opinion and Justice Thomas’s concurrence, including the 2024 disgorgement-versus-distribution statistics cited in that concurrence.