FS Credit Opportunities Corp. v. Saba Capital Master Fund, Ltd.
608 U. S. ___ (2026) · 6/11/26
Section 47(b) of the Investment Company Act does not impliedly empower private parties to sue for rescission of contracts that allegedly violate the Act.
Edition: slip opinion
Voices: Syllabus — prepared by the Reporter of Decisions · Justice Barrett delivered the opinion of the Court. · Justice Kagan, dissenting. · Justice Jackson, with whom Justice Sotomayor joins, and with whom Justice Kagan joins as to Parts I and II, dissenting.
The Investment Company Act (ICA) comprehensively regulates investment companies. The ICA designates the Securities and Exchange Commission as its primary enforcer and expressly permits shareholders and issuers of securities to enforce two of its provisions. The question presented in this case is whether Section 47(b) of the ICA impliedly empowers private parties to sue for rescission of any contract that allegedly violates the Act. Petitioners (“Funds”) are investment companies that manage closed- end mutual funds. These funds are “closed” because each contains a fixed number of shares issued…
Held: Section 47(b) of the ICA does not impliedly empower private parties to sue for rescission of contracts that allegedly violate the Act. Pp. 3–10. (a) Congress, not the Judiciary, decides who may enforce federal law; when Congress creates a private right of action, it usually does so expressly. The Court has rejected the practice of fashioning rights of action, Alexander v. Sandoval, 532 U. S. 275, 287, because judicially created causes of action are difficult to reconcile with “ ‘the Constitution’s separation of legislative and judicial power,’ ” Egbert v. Boule, 596 U. S. 482, 491. If a…Read it in the reading room ›