The Supreme Court heard oral arguments in Lucia v. Securities and Exchange Commission April 23. An audio of the arguments will be released April 27, but the transcript of the arguments, which can be found here, allow us to see why types of questions the justices asked to possibly give some sort of roadmap on how the court will rule. In a previous blog, we informed that this case involves the constitutionality of Administrative Law Judges (ALJs) issuing final decisions despite the fact the Constitution’s appointments clause requires all officers be appointed by the president, the courts or heads of departments. Currently, ALJs are not appointed by any of these authorities and the petitioner, Lucia, is questioning the ALJs authority to offer final decisions.
Although this case directly deals with ALJs in the SEC, it could impact ALJs in other agencies like the Social Security Administration, something Justice Anthony Kennedy brought up during arguments. Kennedy asked if ALJs were ruled unconstitutional to offer final decisions, how would it impact SSA’s ALJs? “If we follow your theory of the case and – you prevail,” Kennedy asked the petitioner, “what effect, if any, will that have on ALJs in other agencies, Social Security ALJs?”
The petitioner’s attorney indicated Social Security ALJs are different from the case being decided. He said that about 150 ALJs would be impacted, but just ALJs in the SEC because those cases are “adversarial” meaning it involves “a private citizen [who is] brought against his or her will before a government body to have his or her fate decided,” the petitioner argued. He said the vast majority of Social Security ALJ determinations are “when a citizen voluntarily goes to the agency and seeks benefits from the government.”
A final point was made by Justice Sonia Sotomayor who questioned the petitioner about how many cases might be impacted if ALJs are ruled officers, but lack the authority to author final decisions due to the appointments clause. The petitioner indicated about 106 cases would be impacted in the SEC, but Sotomayor interjected, “well, if we’re talking just about your agency. But if we’re taking about all the other agencies, we’re – we’re taking in the thousands?”
Oral Argument Summary
The official blogger of the Supreme Court, Ronald Munn, a law professor at Columbia University offered a summary of the arguments made in Lucia v. SEC. Here are some of Munn’s thoughts on the case. His entire summary can be found here.
The problem comes from the Constitution’s appointments clause, which requires that all “officers” of the United States be appointed by the president, by the “courts of law,” or by the “heads of departments.” As Chief Justice John Roberts emphasized repeatedly during the argument, the clause reflects the concern of the Constitution’s drafters with “accountability” – the idea that some readily identifiable official could be held accountable for the selection of any “officer” of the United States. There is considerable tension between that principle, which necessarily ties all who qualify as constitutional “officers” to political appointees, and the principles that undergird the Administrative Procedure Act’s conception of administrative law judges, who are established by design as a base of activity independent from political influence.
In sum, the defenders of the administrative state are not entirely out of the woods. Although some of the justices are sympathetic to the goals that motivate independent appointments, it is not at all clear that five of them will agree that those goals pass muster under the constitutional framework the court’s decisions establish.
