Ongkaruck Sripetch orchestrated a series of “pump-and-dump” schemes involving penny-stock companies, artificially inflating stock prices and selling shares to unwitting investors. The Securities and Exchange Commission (SEC) brought a civil enforcement action, and the United States District Court for the Southern District of California ordered Sripetch to pay back over $2.2 million in illicit profits, plus over $1 million in interest. When a court orders a defendant to surrender their ill-gotten gains like this, it’s called disgorgement. Sripetch argued that he shouldn’t have to pay because the SEC hadn’t proven that specific investors were financially harmed by his scheme. The district court and the Court of Appeals for the Ninth Circuit both rejected that argument. Sripetch petitioned the Supreme Court for review, and the Court agreed to hear the case.

In April 2026, CAC filed an amicus brief supporting the SEC’s position on behalf of leading scholars on the law of restitution. Our brief explains why Sripetch’s argument is wrong.

First, disgorgement has never required proof of harm beyond the violation of a plaintiff’s legal rights. The remedy of disgorgement is supposed to vindicate the fundamental principle that no one may profit from their own wrongdoing. It’s a simple and obvious principle of the law: you shouldn’t be able to break the law to enrich yourself, then claim that you can keep the money because no one was financially harmed. Therefore, the measure of restitution of unjust enrichment is a defendant’s gain, not a plaintiff’s loss. Courts have ordered this remedy, without requiring proof of a plaintiff’s losses, for three centuries.

Second, Sripetch’s position misunderstands the nature of disgorgement and would imperil settled law far beyond the securities context. Sripetch cites the Second Circuit case SEC v. Govil to support his position, but that case’s holding rests on a series of errors about the nature of disgorgement and the authorities on which the court relied. Disgorgement isn’t about what investors lost—it’s about what defendants illegally gained. Govil also misread the third Restatement of Restitution and Unjust Enrichment, which several amici worked on, to claim that an unjust enrichment claim requires “impoverishment.” In fact, the Restatement said the opposite—that a requirement of “impoverishment” is too narrow because a defendant can be unjustly enriched even when no one suffered a financial loss. Sripetch goes even further and claims that the Restatement itself is unreliable—a reinvention of law rather than a restatement of it. But as our brief explained, courts have been ordering disgorgement of unjust gains without proof of financial harm for centuries. Accepting Sripetch’s position wouldn’t just affect securities law—it would unsettle important bodies of law governing intellectual property, fiduciary duty, trespass, and more. The Supreme Court should reject Sripetch’s invitation to upend these longstanding principles.

In June 2026, the Supreme Court unanimously held that the SEC does not have to prove that investors suffered a pecuniary loss before a court can order a securities-law violator to disgorge ill-gotten gains. Justice Gorsuch’s opinion for the Court echoed our central argument that disgorgement has never required a showing that the plaintiff suffered financial harm. Contrasting disgorgement with the legal remedy of damages, the Court explained that “the final award to the plaintiff is not measured by his loss but by the defendant’s gain attributable to his wrongdoing against the plaintiff.” Because “traditional equitable principles do not require a showing of pecuniary loss to justify a disgorgement award,” the Court affirmed the Ninth Circuit’s judgment in the SEC’s favor.