Supreme Court to SEC: Use of in-house administrative law judges unconstitutional
SEC: no longer above the law
The Supreme Court today ruled 6-3 that the SEC has violated the Constitution with its use of in-house administrative law judges to rule on its various securities fraud cases.
The agency, like other regulators, brings some enforcement actions in internal tribunals rather than in federal courts. The S.E.C.’s practice, Chief Justice John G. Roberts Jr. wrote for a six-justice majority in a decision divided along ideological lines, violated the right to a jury trial. “A defendant facing a fraud suit has the right to be tried by a jury of his peers before a neutral adjudicator,” the chief justice wrote.
This ruling against the use of administrative law judges has a direct bearing on SpaceX’s own lawsuit [pdf] against the National Labor Relations Board (NLRB). In January the NLRB filed a complaint against SpaceX, accusing it of firing eight employees illegally for writing a public letter criticizing the company in 2022. Rather than fight that complaint directly, SpaceX’s response was to file a lawsuit challenging the very legal structure of the NLRB itself, including its use of administrative law judges.
That the Supreme Court now has made it clear that the SEC’s use of such administrative law judges is unconstitutional, it is very likely it will rule the same in regard to SpaceX’s lawsuit. Or the case might not get that far, as lower courts will be required to accept the Supreme Court’s decision here as a precedent that must be followed, and rule in favor of SpaceX. Any appeal by the NLRB will face steep headwinds based on today’s decision.
This decision itself does major damage to the powers of these quasi-government agencies, that for decades have ruled like tyrants over American business owners. As SpaceX’s complaint notes, the members of the NLRB not only filed the complaint against SpaceX, those “same NLRB Members would later preside in a quasi-legislative, quasi-judicial capacity in the unfair labor practice proceeding … and then issue the agency’s ultimate order on whether SpaceX has violated federal labor law.”
In other words, proceedings that used administrative law judges allowed government agencies to act as prosecutor, judge, and jury, all in one. No wonder the accused in these cases almost always had to pay fines.
Forcing them now to go through proper legal channels to enforce their fines and punishments will make it much more difficult for them to win their cases. It might in fact completely undercut their power to regulate anything.
To this I say Hallalujah!
On Christmas Eve 1968 three Americans became the first humans to visit another world. What they did to celebrate was unexpected and profound, and will be remembered throughout all human history. Genesis: the Story of Apollo 8, Robert Zimmerman's classic history of humanity's first journey to another world, tells that story, and it is now available as both an ebook and an audiobook, both with a foreword by Valerie Anders and a new introduction by Robert Zimmerman.
The ebook is available everywhere for $5.99 (before discount) at amazon, or direct from my ebook publisher, ebookit. If you buy it from ebookit you don't support the big tech companies and the author gets a bigger cut much sooner.
The audiobook is also available at all these vendors, and is also free with a 30-day trial membership to Audible.
"Not simply about one mission, [Genesis] is also the history of America's quest for the moon... Zimmerman has done a masterful job of tying disparate events together into a solid account of one of America's greatest human triumphs."--San Antonio Express-News
SEC: no longer above the law
The Supreme Court today ruled 6-3 that the SEC has violated the Constitution with its use of in-house administrative law judges to rule on its various securities fraud cases.
The agency, like other regulators, brings some enforcement actions in internal tribunals rather than in federal courts. The S.E.C.’s practice, Chief Justice John G. Roberts Jr. wrote for a six-justice majority in a decision divided along ideological lines, violated the right to a jury trial. “A defendant facing a fraud suit has the right to be tried by a jury of his peers before a neutral adjudicator,” the chief justice wrote.
This ruling against the use of administrative law judges has a direct bearing on SpaceX’s own lawsuit [pdf] against the National Labor Relations Board (NLRB). In January the NLRB filed a complaint against SpaceX, accusing it of firing eight employees illegally for writing a public letter criticizing the company in 2022. Rather than fight that complaint directly, SpaceX’s response was to file a lawsuit challenging the very legal structure of the NLRB itself, including its use of administrative law judges.
That the Supreme Court now has made it clear that the SEC’s use of such administrative law judges is unconstitutional, it is very likely it will rule the same in regard to SpaceX’s lawsuit. Or the case might not get that far, as lower courts will be required to accept the Supreme Court’s decision here as a precedent that must be followed, and rule in favor of SpaceX. Any appeal by the NLRB will face steep headwinds based on today’s decision.
This decision itself does major damage to the powers of these quasi-government agencies, that for decades have ruled like tyrants over American business owners. As SpaceX’s complaint notes, the members of the NLRB not only filed the complaint against SpaceX, those “same NLRB Members would later preside in a quasi-legislative, quasi-judicial capacity in the unfair labor practice proceeding … and then issue the agency’s ultimate order on whether SpaceX has violated federal labor law.”
In other words, proceedings that used administrative law judges allowed government agencies to act as prosecutor, judge, and jury, all in one. No wonder the accused in these cases almost always had to pay fines.
Forcing them now to go through proper legal channels to enforce their fines and punishments will make it much more difficult for them to win their cases. It might in fact completely undercut their power to regulate anything.
To this I say Hallalujah!
On Christmas Eve 1968 three Americans became the first humans to visit another world. What they did to celebrate was unexpected and profound, and will be remembered throughout all human history. Genesis: the Story of Apollo 8, Robert Zimmerman's classic history of humanity's first journey to another world, tells that story, and it is now available as both an ebook and an audiobook, both with a foreword by Valerie Anders and a new introduction by Robert Zimmerman.
The ebook is available everywhere for $5.99 (before discount) at amazon, or direct from my ebook publisher, ebookit. If you buy it from ebookit you don't support the big tech companies and the author gets a bigger cut much sooner.
The audiobook is also available at all these vendors, and is also free with a 30-day trial membership to Audible.
"Not simply about one mission, [Genesis] is also the history of America's quest for the moon... Zimmerman has done a masterful job of tying disparate events together into a solid account of one of America's greatest human triumphs."--San Antonio Express-News
Sic Semper Tyrannus. An excellentand major, even if not entirely sufficient, first step toward disassembling the Deep State.
Related, its the government who makes rules for thee.
https://www.msn.com/en-us/news/politics/california-lawmakers-exempt-their-new-office-building-from-state-environmental-law/ar-BB1oZgOC
But you make sure that if you are building a new building that adhere to the rules that they will not and even refuse or are unable to follow.
A reminder: those adminstrative law judges, whatever their faults and now unconstitutional, did do a lot of work. Many federal agencies have a cadre of them, and of course some (SEC, NRLC, etc.) have a large cadre.
Assume for the moment that these agencies decide to file as many complaints as they have in the recent past against citizens and businesses. All such complaints now must be reviewed in an Article III court. Said district courts will be overwhelmed, unless, of course, you hire many, many more prosecutors, clerks, and (importantly) new district court judges. The latter are presidential nominees confirmed by the Senate; the rest are DOJ personnel.
See where this is headed? The next Congress has to authorize and pay for all this, and the next president will need to nominate several hundred new judges.
Whatever the stakes yesterday, today the stakes for control of the next Congress and the White House are that much higher. The Deep State will not want Mr. Trump to nominate all those judges.
The NLRB should have stopped offshoring and outsourcing
Jeff, the best way to stop offshoring and outsourcing, is for working Americans to stop considering themselves victims, stop voting for government to “protect” them in its various ways, and take the initiative to deliver the productivity that will keep those jobs here.
It can be done. Otherwise there would be no American manufacturing left – including businesses that have employed me in the past and present.
There is a time and place for trade restrictions – to diminish how much rope we buy from tyrannies like China, so they will be less able to fund the force to hang us. And to enforce fair dealing with nations that love our free markets, but won’t open their markets up to our competition.
Going beyond that, is how we slouched into the Administrative Law State this decision addresses … among other problems, past and present.
NLRB Judge = ” Bring the guilty SOB in for a fair trial”
Steve White,
A lot of the “work” the executive branch regulatory agencies do could fairly be characterized as politically-motivated harassment of businesses and individuals who won’t toe the various lines demanded by the overwhelmingly left-wing administrators and rank and file employees of said agencies. This SCOTUS decision will make such “work” more difficult, time-consuming, expensive and less effective from the standpoint of pursuing leftist political agendas from within the government apparat. There will, accordingly, be less of it – far less it is to be hoped. Certainly there should be no basis for wholesale expansion of Article III courts.
To drive the total of politically-motivated agency “actions” down to zero will require the next Trump administration to do three more things:
1. Eliminate government employee unions.
2. Polygraph all current federal employees and all future applicants to find those whose main motive is to further “progressive change” from within the government bureaucracy.
3. Fire all of the latter currently employed by the federal government, cancel their pensions and blackball all such would-be subversive applicants from any future federal employment.
“Supreme Court overturns Chevron decision, curtailing federal agencies’ power in major shift”
“Washington — The Supreme Court on Friday overturned a landmark 40-year-old decision that gave federal agencies broad regulatory power, upending their authority to issue regulations unless Congress has spoken clearly.”
https://www.cbsnews.com/news/supreme-court-chevron-deference-power-of-federal-agencies/
We just had an election in Utah to choose the Republican candidates to run this fall.
(The party put out a recommendation brochure of who the party wants in, to replace the woke governor, and a conservative to replace mitt Romney, among other strong conservatives.)
The results are in, the Democrats won.
Utah is considered the most conservative state in the union and yet no conservatives won. “Just rhinos”, Including Chris Stewart’s temporary house replacement (his secretary whom nobody knows) after he step down a few months ago citing health concerns for his wife then promptly started campaigning for Senator…
This man was once head of the Utah County Democrat party.
How could this happen? They’re claiming low voter turn out due to vacation season, and the fact that most of the Democrats in Utah are registered as Republicans because no Democrat registration required. Hanky-panky is also suspected.
If you can’t beat them, join them!
Gavin Newsom is the DNC Mitt Romney–right down to the brylcream…I half expect those two male fembots on a McCain/Lieberman type ticket, since Ro Khanna would make too much sense
Meanwhile, I’ll have to say White House Press Secretary KJP was absolutely right about cheap fakes.
I saw evidence of Tom Savini’s work…eyes rolling back, veins swelling…
I thought I had tuned into the Presidential Debate–but clearly I was watching SCANNERS.
Wasn’t Michael Ironside in the back row?
@Jester, I used to believe that. Unfortunately, it’s just not true.
Believe in magic and assume that every American worker can just wave his hand to accomplish his task, whatever it might be.
We still can’t compete because we cannot build the factories. Of course, we “can”, but the process is so wrapped up in regulatory red-tape and lawfare that it’s not economical in many cases.
It’s the same reason we have no new nuclear power plants. It’s not that we have unproductive plant operators.
That’s also why we only do high value-added manufacturing. The counter-argument to my incessant “Musk should just leave” comments is that one cannot build rocket engines in Mexico (or wherever). Because it can only be done here, the costs are not relevant. If you’re going to do it all, you must accept them. Jet engines are another example (who knew that turbine blades were so hard to make).
We still can’t compete because we cannot build the factories. Of course, we “can”, but the process is so wrapped up in regulatory red-tape and lawfare that it’s not economical in many cases.
Mark, why is that the case? Perhaps because they (we) made the choice in voting for government to “protect” them in its various ways.
At one time, fracking on Federal lands was restricted in the name of such “protection” … until we elected a President who was willing, to the extent of his authority, to reject that in favor of using our own resources instead of OPEC’s.
Unfortunately, followed by another President who reversed such prudence in the name of “protecting the planet.”
But even that last President is now signing off on expanded use of nuclear power. Things CAN change, when we stop wishing for an effortless/non-profit-driven/risk-free Utopia in our conditioned helplessness and instead exercise our responsibility to assure that government does nothing but act to secure our rights – so we are free to make the efforts and take the risks to get ahead as individuals and neighbors.