The Securities and Exchange Commission is unlikely to appeal the federal court ruling that voided the hedge fund registration rule, Commissioner Paul Atkins told Bloomberg News. The rule would also have allowed for random inspections of hedge funds, but the court decided the SEC did not have the authority to pass such a measure.
"I would be very surprised if the SEC decided to appeal," Atkins said.
SEC spokesman Michael Gonzales declined to comment on Atkins' remarks. After the court reached its decision, SEC Chairman Christopher Cox said he would ask his staff to consider alternative measures.
"There is no basis for an appeal," said hedge fund manager Philip Goldstein, who brought the successful lawsuit against the SEC. "What the SEC has spent on this exercise in illegal rulemaking is enormous. Why throw more money at it?"