SEC In-House Judges Decision Will Come in High Court’s Last Weeks

A dispute over the appointment of the SEC’s in-house judges is among the 21 cases the U.S. Supreme Court still needs to decide before its 2017 term ends in the coming weeks.

Investment adviser Raymond J. Lucia said a Securities and Exchange Commission administrative law judge’s decision barring him from the securities industry shouldn’t stand because the ALJ was a constitutional officer who hadn’t been properly appointed. Of the roughly 60 cases the Supreme Court heard this term, it has yet to issue opinions in about a third. The court will release its next round of opinions June 14.

The justices seemed unsure about how best to resolve the case when they heard oral arguments April 23. The government during the Obama administration had defended the SEC’s position that its ALJs were employees, not officers. In a November 2017 brief, the government reversed its position, conceded the SEC’s ALJs were officers, and retroactively ratified their appointments. U.S. Solicitor General Noel J. Francisco added an argument in that brief about the president’s authority to remove constitutional officers, which could have implications for Special Counsel Robert Mueller’s investigation into Russian election interference.

The case is Lucia v. SEC, U.S., No. 17-00130, oral argument heard 4/23/18.

To contact the reporter on this story: Jennifer Bennett in Washington at jbennett@bloomberglaw.com

To contact the editor responsible for this story: Seth Stern at sstern@bloomberglaw.com