Supreme Court 9, Administrative State 0 The Justices rule that individuals can take a constitutional challenge to federal agencies directly to federal court.
The Supreme Court on Friday dealt the administrative state another blow with a 9-0 decision holding that individuals and businesses harpooned by an independent agency don’t have to suffer a torturous government adjudication to challenge its constitutionality in federal court (Axon Enterprise v. FTC and SEC v. Cochran).
The private litigants in these cases want to challenge Federal Trade Commission and Securities and Exchange Commission actions on grounds that the agencies are unconstitutionally structured. But the discrete question before the Court was whether they had to run through the agencies’ long and costly administrative process before they could go to federal court.
The government claimed they did, but a unanimous Court disagreed. In the controlling opinion, Justice Elena Kagan explained that both parties in the two cases allege they are “‘being subjected’ to ‘unconstitutional agency authority’—a ‘proceeding by an unaccountable [administrative law judge].’”
“This Court has made clear that it is ‘a here-and-now injury,’” she writes, citing its Seila Law (2020) precedent. “And—here is the rub—it is impossible to remedy once the proceeding is over, which is when appellate review kicks in.” Judicial review after cases are adjudicated by the government “would come too late to be meaningful.”
Both defendants in Friday’s cases claim that the agency administrative law judges are insufficiently accountable to the President in violation of the separation of powers. One also challenges the combination of prosecutorial and judicial functions in a single agency. As Justice Kagan notes, “the challenges are fundamental, even existential.”
She adds that the two agencies aren’t suited to judge constitutional claims. The FTC “knows a good deal about competition policy, but nothing special about the separation of powers,” she writes, in a line that should be taken to heart by the agencies but probably won’t be.
Independent agencies have a vested interest in protecting their power. And no agency is going to rule that its procedures or structure are unconstitutional. The recourse has to be in federal court, where the normal standard of judicial review applies, to vindicate the constitutional rights of individuals who challenge agency actions.
The FTC this month dismissed constitutional challenges raised by gene-sequencing giant Illumina to its administrative proceeding. But the Court’s ruling on Friday means that defendants will be able to challenge an agency’s constitutionality in court before getting run through the government grinder. So expect more such challenges.
Friday’s ruling is part of the current Court’s project to reassert the proper understanding of the separation of powers. The Court has tried to rein in administrative agencies that have taken on the power to rewrite laws without Congressional authority, enforce those laws as they see fit, and then review them as if they were an Article III court. That’s why Friday’s ruling is so important to individual liberty.
Comments are closed.
