Securities and Exchange Commission v. Chenery Corporation

After the Court's first Chenery decision rejected the SEC's (defendant) reliance on judicial precedent, the SEC reconsidered and reached the same conclusion -- requiring Chenery (plaintiff) to divest preferred stock acquired during a reorganization -- based instead on the purposes and standards of the Public Utility Holding Company Act, without having previously promulgated a specific rule addressing this exact situation; the court of appeals held the SEC lacked authority to decide the issue without a promulgated rule, and the SEC appealed.