First Page
92
Last Page
128
Document Type
Article
Abstract
The Supreme Court granted certiorari in SEC v. Jarkesy to consider whether good-cause removal protections for SEC administrative law judges violate the Constitution, but ultimately left the question unanswered. The lower court holding that the removal protections are unconstitutional remains on the books for now, neither affirmed nor reversed. And a circuit split lives on. The removal power question is likely headed back to the Supreme Court before long. This Essay examines a key premise of the Jarkesy litigation and its leading precedent, the 2010 case Free Enterprise Fund v. Public Co. Accounting Oversight Board. In both cases, the parties assumed that the SEC is an independent agency. No court second-guessed them. In fact, the Supreme Court in Free Enterprise Fund and the lower court in Jarkesy relied on that assumption to declare an act of Congress unconstitutional. On closer examination, though, no statute actually makes the SEC Commissioners removable for cause. Indeed, the Securities Exchange Act’s legislative history evinces a baseline norm of at-will removal. SEC independence is a myth. This phenomenon raises larger questions of judicial power, getting to the heart of the case-resolution versus law-declaration models of Article III. It also raises questions about the reach of the adversarial system and party presentation. From a certain viewpoint, stipulating to the existence (or nonexistence) of a statute asks a court to rule on hypothetical law. And a ruling on hypothetical law might be an advisory opinion. As the removal power question again percolates through the lower courts, the judiciary would do well to reflect on the limits of its own power, as well as that of Congress and the President.
Recommended Citation
Jack Ferguson
Stipulations of Law and Agency Independence,
2024 Pepp. L. Rev.
92
(2024)
Available at:
https://digitalcommons.pepperdine.edu/plr/vol2024/iss1/5
