A federal judge has rejected a Securities and Exchange Commission case against two mutual fund executives, citing deficiencies in the complaint, the National Law Journal reports.

The case involved two former executives of Columbia Funds Distributors accused of allowing customers to engage in market timing. The SEC filed a case against the two in February 2005 but dismissed it in January 2006. Then, it brought a new lawsuit against them in May 2006, which was dismissed this past December. The SEC appealed the case in March, and it is still pending.

In the past few months, the Commission lost another case in New York, had a case dismissed due to long delays  in Connecticut and had a judge dismiss half the defendants in a third case in Massachusetts.

Lawyers say the two main reasons the SEC is losing or running into trouble on the cases are, first, that it has stepped up its enforcement proceedings to include people with indirect involvement in wrongdoing and, second, its common practice of barring defendants from the securities industry has them fighting harder to win.

“If the SEC has its way, persons in a position of authority will find themselves facing liability simply by virtue of their status as company leaders—whether or not they took any action in furtherance of the alleged fraud or not,” said John Sten of Greenberg Traurig.

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