Regulation through litigation
A term used by Mark Cuban to describe SEC Chair Gary Gensler's strategy for overseeing emerging industries like crypto. Cuban argues this method creates uncertainty and high barriers to entry for startups, favoring litigation over clear rule-making.
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8/22/2025, 12:58:31 AM
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8/22/2025, 1:01:14 AM
Summary
Regulation through litigation describes a process where societal and industrial changes are primarily driven by lawsuits rather than through traditional legislative processes or industry self-regulation. This approach often leverages 'private attorney general' provisions within laws, which empower individuals to file suits to enforce significant rights, frequently including provisions for the recovery of attorney's fees for successful parties in areas such as consumer protection, civil rights, and employment discrimination. This method of regulation can sometimes intersect with judicial activism. A notable contemporary criticism comes from billionaire entrepreneur Mark Cuban, who has publicly lambasted SEC Chair Gary Gensler for employing a 'regulation through litigation' strategy in the context of cryptocurrency, arguing that it hinders innovation in the sector.
Referenced in 1 Document
Research Data
Extracted Attributes
Overlap
May at times overlap with judicial activism.
Incentive
Provisions for recovering attorney's fees for the prevailing party in certain cases.
Mechanism
Often occurs when laws include 'private attorney general' provisions, allowing individuals to sue to uphold important rights.
Definition
Societal and industrial changes driven by litigation rather than legislation or self-regulation.
Common Areas of Application
Consumer protection, civil rights, employment discrimination.
Impact on Innovation (criticism)
Can stifle innovation, particularly in emerging sectors like cryptocurrency.
Timeline
- Mark Cuban criticizes SEC Chair Gary Gensler for using a 'regulation through litigation' strategy towards crypto regulation, arguing it stifles innovation, as discussed on the All-In Podcast. (Source: Related Documents)
2024-XX-XX
Wikipedia
View on WikipediaRegulation through litigation
Regulation through litigation refers to changes in society (particularly those that affect industries) brought about by litigation, rather than legislation or self-regulation. Some laws have "private attorney general" provisions that permit individuals to file suit in court to vindicate important rights. Many laws for addressing consumer protection, civil rights and employment discrimination provide incentives for the private enforcement of laws by allowing the prevailing party to recover a reasonable attorney's fee. Regulation through litigation may at times overlap with judicial activism.
Web Search Results
- [PDF] Using Tort Litigation to Enhance Regulatory Policy Making
Using Tort Litigation to Enhance Regulatory Policy Making: Evaluating Climate-Change Litigation in Light of Lessons from Gun-Industry and Clergy-Sexual-Abuse Lawsuits Timothy D. First, using two examples—gun-industry and clergy-sexual-abuse litigation—the Article highlights six distinct ways in which litigation influences policy making: by (1) framing issues in terms of institutional failure and the need for institutional reform; (2) generating policy-relevant information; (3) placing issues on the agendas of policy-making institutions; (4) filling gaps in statutory or administrative regulatory schemes; (5) encouraging self-regulation; and (6) allowing for diverse regulatory approaches in different jurisdictions.
- Regulation Through Litigation
A Public Choice Comparison of Litigation and the Regulatory State Center for Legal Policy at The Manhattan Institute The Federalist Society U.S. Chamber of Commerce Institute for Legal Reform Sponsored by: Opening Letter Panel One: Litigation or Government Regulation? Pendell Director, Center for Legal Policy, The Manhattan Institute Leonard Leo Director, Lawyers Division, The Federalist Society James Wootton President, Institute for Legal Reform, U.S. Chamber of Commerce Opening Letter 1 Panel One: Litigation or Government Regulation? It also gets you close to the appropriate role for getting the incentives right at the private 59 Panel Two: A Public Choice Comparison of Litigation and the Regulatory State level; entrepreneurs can figure out cost effective means of achiev-ing their objectives either by selling excess allowances, purchasing them on the market, or making intrafirm transfers among their different pollution sources.
- Downstream Due Diligence: Regulation through Litigation
Drimmer, Tara K. Giunta, Nicola Bonucci and Renata Parras Outside of Norway’s Transparency Law, which covers the full value chain, recent domestic mandatory due diligence laws – including Germany’s Supply Chain Act, France’s Duty of Vigilance Law and the Swiss Ordinance on Due Diligence and Transparency in the Sectors of Minerals and Metals from Conflict Areas and Child Labour – likewise turn their gaze upstream, largely ignoring the human rights implications of company products and services.
- [PDF] The Damaging Effect of Regulation of Insurance by the Courts
..........................................................................................................19 Requiring Use of Original Equipment Manufacturer Parts.....................................................19 Punishing Conduct Beyond the State Line.............................................................................21 Expanding Uninsured/Underinsured Motorist Coverage........................................................22 Requiring Overtime Pay for Insurance Adjusters...................................................................26 Requiring Coverage of “Toxic Mold” Claims........................................................................26 Permitting Extraordinary Medical Malpractice Verdicts........................................................28 One Solution: The Fair Notice and Market Stability Model Act.................................31 The Fair Notice and Market Stability Model Act...................................................................31 Legislative Findings..............................................................................................................31 Definitions............................................................................................................................32 Permissible Scope of a Judgment ..........................................................................................32 Remedies ..............................................................................................................................33 Regulatory Authority and Duties...........................................................................................34 Defenses ...............................................................................................................................34 Conclusion............................................................................................................................35 Page 4 of 36 THE NATIONAL ASSOCIATION OF MUTUAL INSURANCE COMPANIES The Damaging Effect of Regulation of Insurance by the Courts By Peter A. 4. The judgment of a court in another state may only extend to a regulated party in this state if the party attempting to apply the judgment shows that: Page 33 of 36 THE NATIONAL ASSOCIATION OF MUTUAL INSURANCE COMPANIES a.
- Cost of Non-Compliance Regulatory Violations & Litigation
# The Cost of Non-Compliance: How Regulatory Violations Can Lead to Business Litigation Regulatory compliance is a critical aspect of running a business, ensuring that companies adhere to industry-specific laws, labor regulations, environmental standards, and financial reporting requirements. Understanding the risks of non-compliance and taking proactive steps to ensure adherence can help businesses avoid financial losses, reputational damage, and legal disputes. Businesses in all industries face compliance risks, but some violations are more common than others. Regulatory non-compliance carries significant financial, operational, and reputational risks for businesses. However, businesses can mitigate these risks by taking proactive compliance measures, staying informed about legal requirements, and fostering a culture of regulatory awareness.
DBPedia
View on DBPediaRegulation through litigation refers to changes in society (particularly those that affect industries) brought about by litigation, rather than legislation or self-regulation. Some laws have "private attorney general" provisions that permit individuals to file suit in court to vindicate important rights. Many laws for addressing consumer protection, civil rights and employment discrimination provide incentives for the private enforcement of laws by allowing the prevailing party to recover a reasonable attorney's fee. Regulation through litigation may at times overlap with judicial activism.