Author granted license

Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International

Document Type


Publication Date





University of Virginia School of Law




In Transamerica Mortgage Advisors, Inc. (TAMA) v. Lewis,1 the United States Supreme Court declined to imply a private right of action for damages under the Investment Advisers Act of 1940.2 Transamerica is the most recent of a series of Supreme Court decisions limiting the availability and scope of implied private actions under the federal securities laws.3 It stands in sharp contrast to J.L Case Co. v. Borak,4 a 1964 decision in which the Court seemed to extend an open invitation to "private attorneys general" to supplement SEC enforcement with private damage actions.

The Court's withdrawal from the Borak experiment reflects a deep and perhaps justified disenchantment with private enforcement of the securities acts. Indeed, the wisdom of permitting private damage actions by implication from the securities acts is questionable.5 The Court's chosen doctrine of implied rights of action, however, is unduly narrow. Whereas Borak expresses the view that the federal courts have inherent power to imply private rights of action for statutory violations,6 Transamerica treats implication as essentially a matter of statutory construction.7 The Transamerica doctrine whittles away a legitimate common-law power of the federal courts and precludes the courts from fashioning implied rights of action where they could play a useful and important role.



To view the content in your browser, please download Adobe Reader or, alternately,
you may Download the file to your hard drive.

NOTE: The latest versions of Adobe Reader do not support viewing PDF files within Firefox on Mac OS and if you are using a modern (Intel) Mac, there is no official plugin for viewing PDF files within the browser window.