January 18, 2018 Practice Points

Supreme Court to Decide Whether SEC’s ALJs Have Been Properly Appointed Under the Constitution

The uncertainty surrounding this issue is clear from the circuit split that currently exists.

By Joshua D. Jones

On Jan 12, 2018, the U.S. Supreme Court granted a petition for a writ of certiorari in Lucia v. Securities and Exchange Commission. Based on this order, it appears that the Court will address the issue of whether the SEC’s administrative law judges were appointed in violation of the U.S. Constitution. Specifically, the Court will determine whether the SEC’s ALJs are Officers of the United States within the meaning of the Appointments Clause. The uncertainty surrounding this issue is clear from the circuit split that currently exists as well as the proceedings below, in which both the panel of the D.C. circuit court of appeals as well as the en banc court of appeals were divided, the en banc panel evenly so. Indeed, the SEC itself had reversed course in its briefing and argued that ALJs are officers subject to the Appointments Clause and urged the high court to hear the case while noting that the legal uncertainty is stalling the SEC’s enforcement of the nation’s securities laws. The importance of resolving the issue was also highlighted by petitioners, as well as amici curiae including The Chamber of Commerce of the United States, Pacific Legal Foundation, Mark Cuban, and the Cato Institute. Be sure to check the Securities Litigation Committee’s website and LinkedIn page for additional developments.

Joshua D. Jones is with Bressler, Amery & Ross PC in Birmingham, Alabama.


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Joshua D. Jones – January 18, 2018