Without skipping a beat, the Securities and Exchange Commission has abandoned plans to appeal the federal appellate court ruling throwing out its hedge fund registration requirement, and may instead introduce new rules as early as this week. "Since the appellate court's decision was based on multiple grounds and was unanimous, further appeal would be futile and would simply delay and distract from our goal of advancing investor protection," said SEC Chairman Christopher Cox in a statement. Cox said he plans to propose a new anti-fraud rule under the Investment Advisers Act that would have the effect of “looking though” a hedge fund to its investors and would “reverse the side effect” of the ruling that the anti-fraud provisions of the act apply only to “clients” as defined by the court and not to investors in hedge funds. The SEC guidance, said Cox, will also address “the grandfathering, transition and other miscellaneous relief necessitated” by the tossing of the rule. The chairman suggested that this would help “eliminate disincentives for voluntary registration” and enable registered hedge fund to remain registered. Cox emphasized that hedge fund will remain subject to the SEC, which “will continue to vigorously enforce” federal securities rules against hedge fund violators.