⚖ Oral Arguments, with Context

The Fifth Circuit hears SEC versus Stanford, an appeal over professional fees in the cleanup of an investment fraud. Stanford International Bank sold certificates of deposit in a Ponzi scheme, using new investors' money to repay earlier investors. After the Securities and Exchange Commission brought its fraud case in two thousand nine, the district court appointed a receiver to take control of the Stanford assets and recover money. The receiver and hired professionals spent years collecting assets and pursuing lawsuits so investors could receive distributions. During that work, the court held back part of the professionals' fees rather than paying everything immediately. In the final distribution order, the judge allowed payment of half those retained fees, rejected an inflation adjustment, and denied Baker Botts compensation for preparing later fee applications. The receiver and professional firms now seek more compensation; the SEC and the court-appointed examiner defend the judge's decision. You will hear the term lodestar: reasonable hours of work multiplied by a reasonable hourly rate. The Johnson factors are considerations courts use in reviewing fees, including the results obtained. The question is whether the judge had adequate grounds to reduce compensation, or should have awarded the additional amounts the professionals requested. Aaron Streett will speak first for the receiver and the professional firms. He will seek full payment of the retained fees, an adjustment for delay, and compensation for preparing fee applications.

SEC v. Stanford (No. 25-11338) — U.S. Court of Appeals for the Fifth Circuit, argued October 7, 2026.