The First Amendment vs. the SEC Gag Rule

In this episode of Unwritten Law, NCLA President Mark Chenoweth and Senior Litigation Counsel John Vecchione are joined by Senior Litigation Counsel Peggy Little to discuss Powell v. SEC, case that NCLA is asking the U.S. Supreme Court to review the SEC’s long-standing “gag rule.”

The rule prohibits individuals who settle with the SEC from ever publicly denying the agency’s allegations—even if they believe those allegations are false. Peggy explains why the case presents a major First Amendment question involving prior restraint, viewpoint discrimination, and unconstitutional conditions.

The conversation also explores the real-world consequences of the rule: how it silences defendants, prevents journalists from reporting both sides of enforcement actions, distorts market information, and allows agencies to expand their power through settlements that most people cannot afford to fight.

The episode discusses key Supreme Court precedents, the Ninth Circuit’s ruling, and why this case could have major implications not just for the SEC, but for government settlement practices across the administrative state.