Myers v. United States (1926)
272 U.S. 52 (1926)
Majority: Taft, joined by Van Devanter, Sutherland, Butler, Sanford, Stone
MR. CHIEF JUSTICE TAFT delivered the opinion of the Court.
This case presents the question whether, under the Constitution, the President has the exclusive power of removing executive officers of the United States whom he has appointed by and with the advice and consent of the Senate.
Myers … was, on July 21, 1917, appointed by the President, by and with the advice and consent of the Senate, to be a postmaster of the first class at Portland, Oregon, for a term of four years. On January 20, 1920, Myers’ resignation was demanded. He refused the demand. On February 2, 1920, he was removed from office by order of the Postmaster General, acting by direction of the President. February 10th, Myers sent a petition to the President and another to the Senate Committee on Post Offices, asking to be heard if any charges were filed. He protested to the Department against his removal, and continued to do so until the end of his term. He pursued no other occupation, and drew compensation for no other service during the interval. On April 21, 1921, he brought this suit in the Court of Claims for his salary from the date of his removal, which, as claimed by supplemental petition filed after July 21, 1921, the end of his term, amounted to $8,838.71 …
[By the law] under which Myers was appointed with the advice and consent of the Senate as a first-class postmaster, it is provided that
“Postmasters of the first, second and third classes shall be appointed and may be removed by the President by and with the advice and consent of the Senate and shall hold their offices for four years unless sooner removed or suspended according to law.”
The Senate did not consent to the President’s removal of Myers during his term. If this statute, in its requirement that his term should be four years unless sooner removed by the President by and with the consent of the Senate, is valid, the appellant, Myers’ administratrix, is entitled to recover his unpaid salary for his full term, and the judgment of the Court of Claims must be reversed. The Government maintains that the requirement is invalid for the reason that, under Article II of the Constitution the President’s power of removal of executive officers appointed by him with the advice and consent of the Senate is full and complete without consent of the Senate … We are therefore confronted by the constitutional question, and cannot avoid it …
The question where the power of removal of executive officers appointed by the President by and with the advice and consent of the Senate was vested was presented early in the first session of the First Congress. There is no express provision respecting removals in the Constitution, except as Section 4 of Article II … provides for removal from office by impeachment …
It was pointed out in this great debate [constitutional convention] that the power of removal, though equally essential to the executive power is different in its nature from that of appointment. Madison, 1 Annals of Congress, 497 et seq.; Clymer, 1 Annals, 489; Sedgwick, 1 Annals, 522; Ames, 1 Annals, 541, 542; Hartley, 1 Annals, 481. A veto by the Senate-a part of the legislative branch of the government-upon removals is a much greater limitation upon the executive branch, and a much more serious blending of the legislative with the executive, than a rejection of a proposed appointment. It is not to be implied. The rejection of a nominee of the President for a particular office does not greatly embarrass him in the conscientious discharge of his high duties in the selection of those who are to aid him, because the President usually has an ample field from which to select for office, according to his preference, competent and capable men. The Senate has full power to reject newly proposed appointees whenever the President shall remove the incumbents. Such a check enables the Senate to prevent the filling of offices with bad or incompetent men, or with those against whom there is tenable objection.
The power to prevent the removal of an officer who has served under the President is different from the authority to consent to or reject his appointment. When a nomination is made, it may be presumed that the Senate is, or may become, as well advised as to the fitness of the nominee as the President, but in the nature of things the defects in ability or intelligence or loyalty in the administration of the laws of one who has served as an officer under the President are facts as to which the President, or his trusted subordinates, must be better informed than the Senate, and the power to remove him may therefor be regarded as confined for very sound and practical reasons, to the governmental authority which has administrative control. The power of removal is incident to the power of appointment, not to the power of advising and consenting to appointment, and when the grant of the executive power is enforced by the express mandate to take care that the laws be faithfully executed, it emphasizes the necessity for including within the executive power as conferred the exclusive power of removal.
The vesting of the executive power in the President was essentially a grant of the power to execute the laws. But the President, alone and unaided, could not execute the laws. He must execute them by the assistance of subordinates. This view has since been repeatedly affirmed by this Court. Wilcox v. Jackson (1839) … It was urged that the natural meaning of the term “executive power” granted the President included the appointment and removal of executive subordinates. If such appointments and removals were not an exercise of the executive power, what were they? They certainly were not the exercise of legislative or judicial power in government as usually understood …
It is true that the remedy for the evil of political executive removals of inferior offices is with Congress by a simple expedient, but it includes a change of the power of appointment from the President with the consent of the Senate. Congress must determine first that the office is inferior, and second that it is willing that the office shall be filled by appointment by some other authority than the President with the consent of the Senate. That the latter may be an important consideration is manifest, and is the subject of comment by this Court in its opinion in the case of Shurtleff v. United States, (1903), where this Court said:
“To take away this power of removal in relation to an inferior office created by statute, although that statute provided for an appointment thereto by the President and confirmation by the Senate, would require very clear and explicit language. It should not be held to be taken away by mere inference or implication … ”
[P]ostmasters were all by law appointed by the Postmaster General. This was because Congress … so provided. But thereafter, Congress required certain classes of them to be, as they now are, appointed by the President with the consent of the Senate. This is an indication that Congress deemed appointment by the President with the consent of the Senate essential to the public welfare, and, until it is willing to vest their appointment in the head of the Department, they will be subject to removal by the President alone, and any legislation to the contrary must fall as in conflict with the Constitution.
Summing up, then, the facts as to acquiescence by all branches of the Government in the legislative decision of 1789, as to executive officers, whether superior or inferior, we find that from 1789 until 1863, a period of 74 years, there was no act of Congress, no executive act, and no decision of this Court at variance with the declaration of the First Congress, but there was, as we have seen, clear, affirmative recognition of it by each branch of the Government.
Article II grants to the President … the general administrative control of those executing the laws, including the power of appointment and removal of executive officers … the President’s power of removal is further established as an incident to his specifically enumerated function of appointment by and with the advice of the Senate, but that such incident does not, by implication, extend to removals the Senate’s power of checking appointments, and … to hold otherwise would make it impossible for the President, in case of political or other differences with the Senate or Congress, to take care that the laws be faithfully executed …
While this Court has studiously avoided deciding the issue until it was presented in such a way that it could not be avoided, in the references it has made to the history of the question, and in the presumptions it has indulged in favor of a statutory construction not inconsistent with the legislative decision of 1789, it has indicated a trend of view that we should not and cannot ignore. When, on the merits, we find our conclusion strongly favoring the view which prevailed in the First Congress, we have no hesitation in holding that conclusion to be correct, and it therefore follows that the Tenure of Office Act of 1867, insofar as it attempted to prevent the President from removing executive officer who had been appointed by him by and with the advice and consent of the Senate, was invalid, and that subsequent legislation of the same effect was equally so.
For the reasons given, we must therefore hold that the provision of the law of 1876, by which the unrestricted power of removal of first class postmasters is denied to the President, is in violation of the Constitution, and invalid. This leads to an affirmance of the judgment of the Court of Claims.
Humphrey’s Executor v. United States (1935)
295 U.S. 602 (1935)
Majority: Sutherland, joined by Hughes, Van Devanter, McReynolds, Brandeis, Butler, Stone, Roberts, and Cardozo
Mr. Justice SUTHERLAND delivered the opinion of the Court.
Plaintiff brought suit in the Court of Claims against the United States to recover a sum of money alleged to be due the deceased for salary as a Federal Trade Commissioner from October 8, 1933, when the President undertook to remove him from office, to the time of his death on February 14, 1934. The court below has certified to this court two questions … in respect of the power of the President to make the removal. The material facts which give rise to the questions are as follows:
William E. Humphrey, the decedent, on December 10, 1931, was nominated by President Hoover to succeed himself as a member of the Federal Trade Commission, and was confirmed by the United States Senate. He was duly commissioned for a term of seven years, expiring September 25, 1938; and, after taking the required oath of office, entered upon his duties. On July 25, 1933, President Roosevelt addressed a letter to the commissioner asking for his resignation, on the ground ‘that the aims and purposes of the Administration with respect to the work of the Commission can be carried out most effectively with personnel of my own selection,’ but disclaiming any reflection upon the commissioner personally or upon his services. The commissioner replied, asking time to consult his friends. After some further correspondence upon the subject, the President on August 31, 1933, wrote the commissioner expressing the hope that the resignation would be forthcoming, and saying: ‘You will, I know, realize that I do not feel that your mind and my mind go along together on either the policies or the administering of the Federal Trade Commission, and, frankly, I think it is best for the people of this country that I should have a full confidence.’
The commissioner declined to resign; and on October 7, 1933, the President wrote him: ‘Effective as of this date you are hereby removed from the office of Commissioner of the Federal Trade Commission.’
Humphrey never acquiesced in this action, but continued thereafter to insist that he was still a member of the commission, entitled to perform its duties and receive the compensation provided by law at the rate of $10,000 per annum. Upon these and other facts set forth in the certificate, which we deem it unnecessary to recite, the following questions are certified:
- Do the provisions of section 1 of the Federal Trade Commission Act, stating that ‘any commissioner may be removed by the President for inefficiency, neglect of duty, or malfeasance in office’, restrict or limit the power of the President to remove a commissioner except upon one or more of the causes named?
If the foregoing question is answered in the affirmative, then—
- If the power of the President to remove a commissioner is restricted or limited as shown by the foregoing interrogatory and the answer made thereto, is such a restriction or limitation valid under the Constitution of the United States?’
The Federal Trade Commission Act … creates a commission of five members to be appointed by the President by and with the advice and consent of the Senate, and section 1 provides: ‘Not more than three of the commissioners shall be members of the same political party. … ‘
[The Act] in part provides that:
‘Unfair methods of competition in commerce are declared unlawful.
The commission is empowered and directed to prevent persons, partnerships, or corporations, except banks, and common carriers subject to the Acts to regulate commerce, from using unfair methods of competition in commerce … ‘
First. The question first to be considered is whether, by the provisions of section 1 … the President’s power is limited to removal for the specific causes enumerated therein. The negative contention of the government is based principally upon the decision of this court in Shurtleff v. United States, (1903) …
The situation here presented is plainly and wholly different. The statute fixes a term of office, in accordance with many precedents … The words of the act are definite and unambiguous.
… The fixing of a definite term subject to removal for cause, unless there be some countervailing provision or circumstance indicating the contrary, which here we are unable to find, is enough to establish the legislative intent that the term is not to be curtailed in the absence of such cause. But if the intention of Congress that no removal should be made during the specified term except for one or more of the enumerated causes were not clear upon the face of the statute, as we think it is, it would be made clear by a consideration of the character of the commission and the legislative history which accompanied and preceded the passage of the act.
The commission is to be nonpartisan; and it must, from the very nature of its duties, act with entire impartiality. It is charged with the enforcement of no policy except the policy of the law. Its duties are neither political nor executive, but predominantly quasi judicial and quasi legislative. Like the Interstate Commerce Commission, its members are called upon to exercise the trained judgment of a body of experts ‘appointed by law and informed by experience’ …
The legislative reports in both houses of Congress clearly reflect the view that a fixed term was necessary to the effective and fair administration of the law …
[T]he language of the act, the legislative reports, and the general purposes of the legislation as reflected by the debates, all combine to demonstrate the congressional intent to create a body of experts who shall gain experience by length of service; a body which shall be independent of executive authority, except in its selection, and free to exercise its judgment without the leave or hindrance of any other official … To the accomplishment of these purposes, it is clear that Congress was of opinion that length and certainty of tenure would vitally contribute. And to hold that, nevertheless, the members of the commission continue in office at the mere will of the President, might be to thwart, in large measure, the very ends which Congress sought to realize by definitely fixing the term of office.
… Second. To support its contention that the removal provision … is an unconstitutional interference with the executive power of the President, the government’s chief reliance is Myers v. United States (1926) … [T]he narrow point actually decided was only that the President had power to remove a postmaster of the first class, without the advice and consent of the Senate as required by act of Congress. In the course of the opinion of the court, expressions occur which tend to sustain the government’s contention, but these are beyond the point involved and, therefore, do not come within the rule of stare decisis …
The office of a postmaster is so essentially unlike the office now involved that the decision in the Myers case cannot be accepted as controlling our decision here. A postmaster is an executive officer restricted to the performance of executive functions. He is charged with no duty at all related to either the legislative or judicial power. The actual decision in the Myers case finds support in the theory that such an officer is merely one of the units in the executive department and, hence, inherently subject to the exclusive and illimitable power of removal by the Chief Executive, whose subordinate and aid he is. Putting aside dicta, which may be followed if sufficiently persuasive but which are not controlling, the necessary reach of the decision goes far enough to include all purely executive officers. It goes no farther; much less does it include an officer who occupies no place in the executive department and who exercises no part of the executive power vested by the Constitution in the President.
The Federal Trade Commission is an administrative body created by Congress to carry into effect legislative policies embodied in the statute in accordance with the legislative standard therein prescribed, and to perform other specified duties as a legislative or as a judicial aid. Such a body cannot in any proper sense be characterized as an arm or an eye of the executive. Its duties are performed without executive leave and, in the contemplation of the statute, must be free from executive control. In administering the provisions of the statute in respect of ‘unfair methods of competition,’ that is to say, in filling in and administering the details embodied by that general standard, the commission acts in part quasi legislatively and in part quasi judicially … To the extent that it exercises any executive function, as distinguished from executive power in the constitutional sense, it does so in the discharge and effectuation of its quasi legislative or quasi judicial powers, or as an agency of the legislative or judicial departments of the government … If Congress is without authority to prescribe causes for removal of members of the trade commission and limit executive power of removal accordingly, that power at once becomes practically all-inclusive in respect of civil officers with the exception of the judiciary provided for by the Constitution … We are thus confronted with the serious question whether not only the members of these quasi legislative and quasi judicial bodies, but the judges of the legislative Court of Claims, exercising judicial power … continue in office only at the pleasure of the President.
We think it plain under the Constitution that illimitable power of removal is not possessed by the President in respect of officers of the character of those just named. The authority of Congress, in creating quasi legislative or quasi judicial agencies, to require them to act in discharge of their duties independently of executive control cannot well be doubted; and that authority includes, as an appropriate incident, power to fix the period during which they shall continue, and to forbid their removal except for cause in the meantime. For it is quite evident that one who holds his office only during the pleasure of another cannot be depended upon to maintain an attitude of independence against the latter’s will …
A reading of the debates shows that the President’s illimitable power of removal was not considered in respect of other than executive officers. And it is pertinent to observe that when, at a later time, the tenure of office for the Comptroller of the Treasury was under consideration, Mr. Madison quite evidently thought that, since the duties of that office were not purely of an executive nature but partook of the judiciary quality as well, a different rule in respect of executive removal might well apply. 1 Annals of Congress, cols. 611-612 …
The result of what we now have said is this: Whether the power of the President to remove an officer shall prevail over the authority of Congress to condition the power by fixing a definite term and precluding a removal except for cause will depend upon the character of the office; the Myers decision, affirming the power of the President alone to make the removal, is confined to purely executive officers; and as to officers of the kind here under consideration, we hold that no removal can be made during the prescribed term for which the officer is appointed, except for one or more of the causes named in the applicable statute.
To the extent that, between the decision in the Myers case, which sustains the unrestrictable power of the President to remove purely executive officers, and our present decision that such power does not extend to an office such as that here involved, there shall remain a field of doubt, we leave such cases as may fall within it for future consideration and determination as they may arise.
In accordance with the foregoing, the questions submitted are answered:
Question No. 1, Yes.
Question No. 2, Yes.
It is so ordered.
Morrison v. Olson (1988)
487 U.S. 654 (1988)
Majority: Rehnquist, joined by Brennan, White, Marshall, Blackmun, Stevens, and O’Connor
CHIEF JUSTICE REHNQUIST delivered the opinion of the Court.
This case presents us with a challenge to the independent counsel provisions of the Ethics in Government Act of 1978 … We hold today that these provisions of the Act do not violate the Appointments Clause of the Constitution, Art. II, § 2, cl. 2, or the limitations of Article III, nor do they impermissibly interfere with the President’s authority under Article II in violation of the constitutional principle of separation of powers.
Briefly stated, Title VI of the Ethics in Government Act … allows for the appointment of an “independent counsel” to investigate and, if appropriate, prosecute certain high-ranking Government officials for violations of federal criminal laws … The Act requires the Attorney General, upon receipt of information that he determines is “sufficient to constitute grounds to investigate whether any person [covered by the Act] may have violated any Federal criminal law,” to conduct a preliminary investigation of the matter … If … the Attorney General has determined that there are “reasonable grounds to believe that further investigation or prosecution is warranted,” then he “shall apply to the division of the court for the appointment of an independent counsel … ”
With respect to all matters within the independent counsel’s jurisdiction, the Act grants the counsel “full power and independent authority to exercise all investigative and prosecutorial functions and powers of the Department of Justice, the Attorney General, and any other officer or employee of the Department of Justice … ” The functions of the independent counsel include conducting grand jury proceedings and other investigations, participating in civil and criminal court proceedings and litigation, and appealing any decision in any case in which the counsel participates in an official capacity … the counsel’s powers include “initiating and conducting prosecutions in any court of competent jurisdiction, framing and signing indictments, filing informations, and handling all aspects of any case, in the name of the United States … ” … An independent counsel has “full authority to dismiss matters within [his or her] prosecutorial jurisdiction without conducting an investigation or at any subsequent time before prosecution, if to do so would be consistent” with Department of Justice policy …
Two statutory provisions govern the length of an independent counsel’s tenure in office. The first defines the procedure for removing an independent counsel. Section 596(a)(1) provides:
“An independent counsel appointed under this chapter may be removed from office, other than by impeachment and conviction, only by the personal action of the Attorney General … ”
If an independent counsel is removed pursuant to this section, the Attorney General is required to submit a report to both the Special Division and the Judiciary Committees of the Senate and the House “specifying the facts found and the ultimate grounds for such removal.” § 596(a)(2). Under the current version of the Act, an independent counsel can obtain judicial review of the Attorney General’s action by filing a civil action in the United States District Court for the District of Columbia … The reviewing court is authorized to grant reinstatement or “other appropriate relief.” § 596(a)(3) …
The other provision governing the tenure of the independent counsel defines the procedures for “terminating” the counsel’s office. Under § 596(b)(1), the office of an independent counsel terminates when he or she notifies the Attorney General that he or she has completed or substantially completed any investigations or prosecutions undertaken pursuant to the Act …
Finally, the Act provides for congressional oversight of the activities of independent counsel …
On April 23, 1986, the Special Division appointed James C. McKay as independent counsel to investigate “whether the testimony of … Olson and his revision of such testimony on March 10, 1983, violated either 18 U. S. C. § 1505 or § 1001, or any other provision of federal law … ”
McKay later resigned as independent counsel, and on May 29, 1986, the Division appointed appellant Morrison as his replacement, with the same jurisdiction …
[I]n May and June 1987, appellant caused a grand jury to issue and serve … on appellees. All three appellees moved to quash the subpoenas, claiming, among other things, that the independent counsel provisions of the Act were unconstitutional and that appellant accordingly had no authority to proceed …
The initial question is, accordingly, whether appellant is an “inferior” or a “principal” officer … If she is the latter, as the Court of Appeals concluded, then the Act is in violation of the Appointments Clause. The line between “inferior” and “principal” officers is one that is far from clear, and the Framers provided little guidance into where it should be drawn … [I]n our view appellant clearly falls on the “inferior officer” side of that line. Several factors lead to this conclusion.
First, appellant is subject to removal by a higher Executive Branch official. Although appellant may not be “subordinate” to the Attorney General (and the President) insofar as she possesses a degree of independent discretion to exercise the powers delegated to her under the Act, the fact that she can be removed by the Attorney General indicates that she is to some degree “inferior” in rank and authority. Second, appellant is empowered by the Act to perform only certain, limited duties … Admittedly, the Act delegates to appellant “full power and independent authority to exercise all investigative and prosecutorial functions and powers of the Department of Justice,” § 594(a), but this grant of authority does not include any authority to formulate policy for the Government or the Executive Branch, nor does it give appellant any administrative duties outside of those necessary to operate her office. The Act specifically provides that in policy matters appellant is to comply to the extent possible with the policies of the Department …
Third, appellant’s office is limited in jurisdiction. Not only is the Act itself restricted in applicability to certain federal officials suspected of certain serious federal crimes, but an independent counsel can only act within the scope of the jurisdiction that has been granted by the Special Division pursuant to a request by the Attorney General. Finally, appellant’s office is limited in tenure. There is concededly no time limit on the appointment of a particular counsel. Nonetheless, the office of independent counsel is “temporary” in the sense that an independent counsel is appointed essentially to accomplish a single task, and when that task is over the office is terminated, either by the counsel herself or by action of the Special Division. Unlike other prosecutors, appellant has no ongoing responsibilities that extend beyond the accomplishment of the mission that she was appointed for and authorized by the Special Division to undertake. In our view, these factors relating to the “ideas of tenure, duration … and duties” of the independent counsel, Germaine, are sufficient to establish that appellant is an “inferior” officer in the constitutional sense.
This conclusion is consistent with our few previous decisions that considered the question whether a particular Government official is a “principal” or an “inferior” officer …
Appellees argue that even if appellant is an “inferior” officer, the Clause does not empower Congress to place the power to appoint such an officer outside the Executive Branch. They contend that the Clause does not contemplate congressional authorization of “interbranch appointments,” in which an officer of one branch is appointed by officers of another branch. The relevant language of the Appointments Clause is worth repeating. It reads: ” … but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the courts of Law, or in the Heads of Departments.” On its face, the language of this “excepting clause” admits of no limitation on interbranch appointments. Indeed, the inclusion of “as they think proper” seems clearly to give Congress significant discretion to determine whether it is “proper” to vest the appointment of, for example, executive officials in the “courts of Law … ”
We also note that the history of the Clause provides no support for appellees’ position …
We do not mean to say that Congress’ power to provide for interbranch appointments of “inferior officers” is unlimited. In addition to separation-of-powers concerns, which would arise if such provisions for appointment had the potential to impair the constitutional functions assigned to one of the branches, Ex parte Siebold (1879) itself suggested that Congress’ decision to vest the appointment power in the courts would be improper if there was some “incongruity” between the functions normally performed by the courts and the performance of their duty to appoint … In this case, however, we do not think it impermissible for Congress to vest the power to appoint independent counsel in a specially created federal court …
We now turn to consider whether the Act is invalid under the constitutional principle of separation of powers. Two related issues must be addressed: The first is whether the provision of the Act restricting the Attorney General’s power to remove the independent counsel to only those instances in which he can show “good cause,” taken by itself, impermissibly interferes with the President’s exercise of his constitutionally appointed functions. The second is whether, taken as a whole, the Act violates the separation of powers by reducing the President’s ability to control the prosecutorial powers wielded by the independent counsel.
Unlike both Bowsher and Myers, this case does not involve an attempt by Congress itself to gain a role in the removal of executive officials other than its established powers of impeachment and conviction. The Act instead puts the removal power squarely in the hands of the Executive Branch; an independent counsel may be removed from office, “only by the personal action of the Attorney General, and only for good cause.” § 596(a)(1) … There is no requirement of congressional approval of the Attorney General’s removal decision, though the decision is subject to judicial review. § 596(a)(3). In our view, the removal provisions of the Act make this case more analogous to Humphrey’s Executor v. United States, (1935), and Wiener v. United States, (1958), than to Myers or Bowsher …
Appellees contend that Humphrey’s Executor and Wiener are distinguishable from this case because they did not involve officials who performed a “core executive function.” They argue that our decision in Humphrey’s Executor rests on a distinction between “purely executive” officials and officials who exercise “quasi-legislative” and “quasi-judicial” powers. In their view, when a “purely executive” official is involved, the governing precedent is Myers, not Humphrey’s Executor. And, under Myers, the President must have absolute discretion to discharge “purely” executive officials at will …
We undoubtedly did rely on the terms “quasi-legislative” and “quasi-judicial” to distinguish the officials involved in Humphrey’s Executor and Wiener from those in Myers, but our present considered view is that the determination of whether the Constitution allows Congress to impose a “good cause”-type restriction on the President’s power to remove an official cannot be made to turn on whether or not that official is classified as “purely executive … ” The analysis contained in our removal cases is designed not to define rigid categories of those officials who may or may not be removed at will by the President … but to ensure that Congress does not interfere with the President’s exercise of the “executive power” and his constitutionally appointed duty to “take care that the laws be faithfully executed” under Article II. Myers was undoubtedly correct in its holding, and in its broader suggestion that there are some “purely executive” officials who must be removable by the President at will if he is to be able to accomplish his constitutional role … But as the Court noted in Wiener:
“The assumption was short-lived that the Myers case recognized the President’s inherent constitutional power to remove officials no matter what the relation of the executive to the discharge of their duties and no matter what restrictions Congress may have imposed regarding the nature of their tenure … ”
[T]he real question is whether the removal restrictions are of such a nature that they impede the President’s ability to perform his constitutional duty, and the functions of the officials in question must be analyzed in that light.
Considering for the moment the “good cause” removal provision in isolation from the other parts of the Act at issue in this case, we cannot say that the imposition of a “good cause” standard for removal by itself unduly trammels on executive authority. There is no real dispute that the functions performed by the independent counsel are “executive” in the sense that they are law enforcement functions that typically have been undertaken by officials within the Executive Branch. As we noted above, however, the independent counsel is an inferior officer under the Appointments Clause … we simply do not see how the President’s need to control the exercise of that discretion is so central to the functioning of the Executive Branch as to require as a matter of constitutional law that the counsel be terminable at will by the President …
Nor do we think that the “good cause” removal provision at issue here impermissibly burdens the President’s power to control or supervise the independent counsel, as an executive official, in the execution of his or her duties under the Act. This is not a case in which the power to remove an executive official has been completely stripped from the President, thus providing no means for the President to ensure the “faithful execution” of the laws. Rather, because the independent counsel may be terminated for “good cause,” the Executive, through the Attorney General, retains ample authority to assure that the counsel is competently performing his or her statutory responsibilities in a manner that comports with the provisions of the Act … Here, as with the provision of the Act conferring the appointment authority of the independent counsel on the special court, the congressional determination to limit the removal power of the Attorney General was essential, in the view of Congress, to establish the necessary independence of the office. We do not think that this limitation as it presently stands sufficiently deprives the President of control over the independent counsel to interfere impermissibly with his constitutional obligation to ensure the faithful execution of the laws …
The final question to be addressed is whether the Act, taken as a whole, violates the principle of separation of powers by unduly interfering with the role of the Executive Branch. Time and again we have reaffirmed the importance in our constitutional scheme of the separation of governmental powers into the three coordinate branches … We have not hesitated to invalidate provisions of law which violate this principle. On the other hand, we have never held that the Constitution requires that the three branches of Government “operate with absolute independence … ” In the often-quoted words of Justice Jackson:
“While the Constitution diffuses power the better to secure liberty, it also contemplates that practice will integrate the dispersed powers into a workable government. It enjoins upon its branches separateness but interdependence, autonomy but reciprocity.” Youngstown Sheet & Tube Co. v. Sawyer, (1952) (concurring opinion).
We observe first that this case does not involve an attempt by Congress to increase its own powers at the expense of the Executive Branch … Indeed, with the exception of the power of impeachment — which applies to all officers of the United States — Congress retained for itself no powers of control or supervision over an independent counsel. The Act does empower certain Members of Congress to request the Attorney General to apply for the appointment of an independent counsel, but the Attorney General has no duty to comply with the request, although he must respond within a certain time limit. § 592(g). Other than that, Congress’ role under the Act is limited to receiving reports or other information and oversight of the independent counsel’s activities, § 595(a), functions that we have recognized generally as being incidental to the legislative function of Congress …
Similarly, we do not think that the Act works any judicial usurpation of properly executive functions. As should be apparent from our discussion of the Appointments Clause above, the power to appoint inferior officers such as independent counsel is not in itself an “executive” function in the constitutional sense, at least when Congress has exercised its power to vest the appointment of an inferior office in the “courts of Law.” … In addition, once the court has appointed a counsel and defined his or her jurisdiction, it has no power to supervise or control the activities of the counsel. … [T]he various powers delegated by the statute to the Division are not supervisory or administrative, nor are they functions that the Constitution requires be performed by officials within the Executive Branch. The Act does give a federal court the power to review the Attorney General’s decision to remove an independent counsel, but in our view this is a function that is well within the traditional power of the Judiciary.
Finally, we do not think that the Act “impermissibly undermine[s]” the powers of the Executive Branch … or “disrupts the proper balance between the coordinate branches [by] prevent[ing] the Executive Branch from accomplishing its constitutionally assigned functions … ” It is undeniable that the Act reduces the amount of control or supervision that the Attorney General and, through him, the President exercises over the investigation and prosecution of a certain class of alleged criminal activity … The Act … gives the Executive a degree of control over the power to initiate an investigation by the independent counsel. In addition, the jurisdiction of the independent counsel is defined with reference to the facts submitted by the Attorney General, and once a counsel is appointed, the Act requires that the counsel abide by Justice Department policy unless it is not “possible” to do so. Notwithstanding the fact that the counsel is to some degree “independent” and free from executive supervision to a greater extent than other federal prosecutors, in our view these features of the Act give the Executive Branch sufficient control over the independent counsel to ensure that the President is able to perform his constitutionally assigned duties.
In sum, we conclude today that it does not violate the Appointments Clause for Congress to vest the appointment of independent counsel in the Special Division; that the powers exercised by the Special Division under the Act do not violate Article III; and that the Act does not violate the separation-of-powers principle by impermissibly interfering with the functions of the Executive Branch. The decision of the Court of Appeals is therefore
JUSTICE KENNEDY took no part in the consideration or decision of this case.
NLRB v. Canning (2014)
573 U.S. 513 (2014)
Majority: Breyer, joined by Kennedy, Ginsburg, Sotomayor, and Kagan
Concurrence: Scalia (in judgment), joined by Roberts, Thomas, and Alito
Note: A pro forma session is defined as “From the Latin, meaning ‘as a matter of form,’ a pro forma session is a brief meeting of the Senate, often only a few minutes in duration.” https://www.senate.gov/general/Features/Sessions.htm#:~:text=Pro%20Forma%20Session%3A%20From%20the,following%20the%20November%20general%20elections.
Visit https://www.c-span.org/video/?526638-1/senate-pro-forma-session to see the c-span to view a pro forma session.
Justice Breyer delivered the opinion of the Court.
Ordinarily the President must obtain “the Advice and Consent of the Senate” before appointing an “Office[r] of the United States.” U. S. Const., Art. II, §2, cl. 2. But the Recess Appointments Clause creates an exception. It gives the President alone the power “to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.” Art. II, §2, cl. 3. We here consider three questions about the application of this Clause.
The first concerns the scope of the words “recess of the Senate.” Does that phrase refer only to an inter-session recess (i.e., a break between formal sessions of Congress), or does it also include an intra-session recess, such as a summer recess in the midst of a session? We conclude that the Clause applies to both kinds of recess.
The second question concerns the scope of the words “vacancies that may happen.” Does that phrase refer only to vacancies that first come into existence during a recess, or does it also include vacancies that arise prior to a recess but continue to exist during the recess? We conclude that the Clause applies to both kinds of vacancy.
The third question concerns calculation of the length of a “recess.” The President made the appointments here at issue on January 4, 2012. At that time the Senate was in recess pursuant to a December 17, 2011, resolution providing for a series of brief recesses punctuated by “pro forma session[s],” with “no business … transacted,” every Tuesday and Friday through January 20, 2012 … In calculating the length of a recess are we to ignore the pro forma sessions, thereby treating the series of brief recesses as a single, month-long recess? We conclude that we cannot ignore these pro forma sessions.
Our answer to the third question means that, when the appointments before us took place, the Senate was in the midst of a 3-day recess. Three days is too short a time to bring a recess within the scope of the Clause. Thus we conclude that the President lacked the power to make the recess appointments here at issue.
The case before us arises out of a labor dispute. The National Labor Relations Board (NLRB) found that a Pepsi-Cola distributor, Noel Canning, had unlawfully refused to reduce to writing and execute a collective-bargaining agreement with a labor union. The Board ordered the distributor to execute the agreement and to make employees whole for any losses …
The Pepsi-Cola distributor subsequently asked the Court of Appeals for the District of Columbia Circuit to set the Board’s order aside. It claimed that three of the five Board members had been invalidly appointed, leaving the Board without the three lawfully appointed members necessary for it to act …
The three members in question were Sharon Block, Richard Griffin, and Terence Flynn. In 2011 the President had nominated each of them to the Board. As of January 2012, Flynn’s nomination had been pending in the Senate awaiting confirmation for approximately a year. The nominations of each of the other two had been pending for a few weeks. On January 4, 2012, the President, invoking the Recess Appointments Clause, appointed all three to the Board.
The distributor argued that the Recess Appointments Clause did not authorize those appointments. It pointed out that on December 17, 2011, the Senate, by unanimous consent, had adopted a resolution providing that it would take a series of brief recesses beginning the following day … Pursuant to that resolution, the Senate held pro forma sessions every Tuesday and Friday until it returned for ordinary business on January 23, 2012 … The President’s January 4 appointments were made between the January 3 and January 6 pro forma sessions. In the distributor’s view, each pro forma session terminated the immediately preceding recess. Accordingly, the appointments were made during a 3-day adjournment, which is not long enough to trigger the Recess Appointments Clause.
The Court of Appeals agreed that the appointments fell outside the scope of the Clause. But the court set forth different reasons … Since the second session of the 112th Congress began on January 3, 2012, the day before the President’s appointments, those appointments occurred during an intra-session recess, and the appointments consequently fell outside the scope of the Clause …
We asked the parties to address not only the Court of Appeals’ interpretation of the Clause but also the distributor’s initial argument, namely, “[w]hether the President’s recess-appointment power may be exercised when the Senate is convening every three days in pro forma sessions … ”
… [T]he Recess Appointments Clause reflects the tension between, on the one hand, the President’s continuous need for “the assistance of subordinates,” Myers v. United States, (1926), and, on the other, the Senate’s practice, particularly during the Republic’s early years, of meeting for a single brief session each year … We seek to interpret the Clause as granting the President the power to make appointments during a recess but not offering the President the authority routinely to avoid the need for Senate confirmation.
Second, in interpreting the Clause, we put significant weight upon historical practice. For one thing, the interpretive questions before us concern the allocation of power between two elected branches of Government. Long ago Chief Justice Marshall wrote that
“a doubtful question, one on which human reason may pause, and the human judgment be suspended, in the decision of which the great principles of liberty are not concerned, but the respective powers of those who are equally the representatives of the people, are to be adjusted; if not put at rest by the practice of the government, ought to receive a considerable impression from that practice.” McCulloch v. Maryland, (1819) …
The first question concerns the scope of the phrase “the recess of the Senate … ” The Constitution provides for congressional elections every two years. And the 2-year life of each elected Congress typically consists of two formal 1-year sessions, each separated from the next by an “inter-session recess … ” The Senate or the House of Representatives announces an inter-session recess by approving a resolution stating that it will “adjourn sine die,” i.e., without specifying a date to return (in which case Congress will reconvene when the next formal session is scheduled to begin).
The Senate and the House also take breaks in the midst of a session. The Senate or the House announces any such “intra-session recess” by adopting a resolution stating that it will “adjourn” to a fixed date, a few days or weeks or even months later. All agree that the phrase “the recess of the Senate” covers inter-session recesses. The question is whether it includes intra-session recesses as well.
In our view, the phrase “the recess” includes an intra-session recess of substantial length …
History … shows only that Congress generally took long breaks between sessions, while taking no significant intra-session breaks at all (five times it took a break of a week or so at Christmas) … In 1867 and 1868, Congress for the first time took substantial, nonholiday intra-session breaks, and President Andrew Johnson made dozens of recess appointments. The Federal Court of Claims upheld one of those specific appointments, writing “[w]e have no doubt that a vacancy occurring while the Senate was thus temporarily adjourned” during the “first session of the Fortieth Congress” was “legally filled by appointment of the President alone.” Gould v. United States, (1884) …
… [R]estricting the Clause to inter-session recesses would frustrate its purpose. It would make the President’s recess-appointment power dependent on a formalistic distinction of Senate procedure. Moreover, the President has consistently and frequently interpreted the word “recess” to apply to intra-session recesses, and has acted on that interpretation. The Senate as a body has done nothing to deny the validity of this practice for at least three-quarters of a century …
[A] 3-day recess would be too short … The Adjournments Clause reflects the fact that a 3-day break is not a significant interruption of legislative business. As the Solicitor General says, it is constitutionally de minimis. A Senate recess that is so short that it does not require the consent of the House is not long enough to trigger the President’s recess-appointment power.
In sum, we conclude that the phrase “the recess” applies to both intra-session and inter-session recesses. If a Senate recess is so short that it does not require the consent of the House, it is too short to trigger the Recess Appointments Clause. See Art. I, §5, cl. 4. And a recess lasting less than 10 days is presumptively too short as well.
The second question concerns the scope of the phrase “vacancies that may happen during the recess of the Senate.” Art. II, §2, cl. 3 … All agree that the phrase applies to vacancies that initially occur during a recess. But does it also apply to vacancies that initially occur before a recess and continue to exist during the recess? In our view the phrase applies to both kinds of vacancy …
This power is important. The Congressional Research Service is “unaware of any official source of information tracking the dates of vacancies in federal offices … ” Nonetheless, we have enough information to believe that the Presidents since Madison have made many recess appointments filling vacancies that initially occurred prior to a recess …
[T]he President has consistently and frequently interpreted the Recess Appointments Clause to apply to vacancies that initially occur before, but continue to exist during, a recess of the Senate. The Senate as a body has not countered this practice for nearly three-quarters of a century, perhaps longer …
In light of some linguistic ambiguity, the basic purpose of the Clause, and the historical practice we have described, we conclude that the phrase “all vacancies” includes vacancies that come into existence while the Senate is in session.
The third question concerns the calculation of the length of the Senate’s “recess.” On December 17, 2011, the Senate by unanimous consent adopted a resolution to convene “pro forma session[s]” only, with “no business … transacted,” on every Tuesday and Friday from December 20, 2011, through January 20, 2012 … At the end of each pro forma session, the Senate would “adjourn until” the following pro forma session. Ibid. During that period, the Senate convened and adjourned as agreed. It held pro forma sessions on December 20, 23, 27, and 30, and on January 3, 6, 10, 13, 17, and 20; and at the end of each pro forma session, it adjourned until the time and date of the next …
The Solicitor General argues that we must treat the pro forma sessions as periods of recess. He says that these “sessions” were sessions in name only because the Senate was in recess as a functional matter. The Senate, he contends, remained in a single, unbroken recess from January 3, when the second session of the 112th Congress began by operation of the Twentieth Amendment, until January 23, when the Senate reconvened to do regular business.
In our view, however, the pro forma sessions count as sessions, not as periods of recess. We hold that, for purposes of the Recess Appointments Clause, the Senate is in session when it says it is, provided that, under its own rules, it retains the capacity to transact Senate business. The Senate met that standard here …
[W]e conclude that we must give great weight to the Senate’s own determination of when it is and when it is not in session. But our deference to the Senate cannot be absolute. When the Senate is without the capacity to act, under its own rules, it is not in session even if it so declares … In that circumstance, the Senate is not simply unlikely or unwilling to act upon nominations of the President. It is unable to do so. The purpose of the Clause is to ensure the continued functioning of the Federal Government while the Senate is unavailable … This purpose would count for little were we to treat the Senate as though it were in session even when it lacks the ability to provide its “advice and consent.” Art. II, §2, cl. 2. Accordingly, we conclude that when the Senate declares that it is in session and possesses the capacity, under its own rules, to conduct business, it is in session for purposes of the Clause.
Applying this standard, we find that the pro forma sessions were sessions for purposes of the Clause. First, the Senate said it was in session. The Journal of the Senate and the Congressional Record indicate that the Senate convened for a series of twice-weekly “sessions” from December 20 through January 20 …
Second, the Senate’s rules make clear that during its pro forma sessions, despite its resolution that it would conduct no business, the Senate retained the power to conduct business. During any pro forma session, the Senate could have conducted business simply by passing a unanimous consent agreement … It is consequently unsurprising that the Senate has enacted legislation during pro forma sessions even when it has said that no business will be transacted. Indeed, the Senate passed a bill by unanimous consent during the second pro forma session after its December 17 adjournment …
The Recess Appointments Clause responds to a structural difference between the Executive and Legislative Branches: The Executive Branch is perpetually in operation, while the Legislature only acts in intervals separated by recesses. The purpose of the Clause is to allow the Executive to continue operating while the Senate is unavailable. We believe that the Clause’s text, standing alone, is ambiguous. It does not resolve whether the President may make appointments during intra-session recesses, or whether he may fill pre-recess vacancies. But the broader reading better serves the Clause’s structural function. Moreover, that broader reading is reinforced by centuries of history, which we are hesitant to disturb. We thus hold that the Constitution empowers the President to fill any existing vacancy during any recess—intra-session or inter-session—of sufficient length.
Given our answer to the last question before us, we conclude that the Recess Appointments Clause does not give the President the constitutional authority to make the appointments here at issue. Because the Court of Appeals reached the same ultimate conclusion (though for reasons we reject), its judgment is affirmed.
It is so ordered.
Justice Scalia, with whom The Chief Justice, Justice Thomas, and Justice Alito join, concurring in the judgment.
Except where the Constitution or a valid federal law provides otherwise, all “Officers of the United States” must be appointed by the President “by and with the Advice and Consent of the Senate.” U. S. Const., Art. II, §2, cl. 2. That general rule is subject to an exception: “The President shall have Power to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.” Id., §2, cl. 3. This case requires us to decide whether the Recess Appointments Clause authorized three appointments made by President Obama to the National Labor Relations Board in January 2012 without the Senate’s consent.
To prevent the President’s recess-appointment power from nullifying the Senate’s role in the appointment process, the Constitution cabins that power in two significant ways. First, it may be exercised only in “the Recess of the Senate,” that is, the intermission between two formal legislative sessions. Second, it may be used to fill only those vacancies that “happen during the Recess,” that is, offices that become vacant during that intermission. Both conditions are clear from the Constitution’s text and struc ture, and both were well understood at the founding. The Court of Appeals correctly held that the appointments here at issue are invalid because they did not meet either condition …
The Court’s decision transforms the recess-appointment power from a tool carefully designed to fill a narrow and specific need into a weapon to be wielded by future Presidents against future Senates. To reach that result, the majority casts aside the plain, original meaning of the constitutional text in deference to late-arising historical practices that are ambiguous at best. The majority’s insistence on deferring to the Executive’s untenably broad interpretation of the power is in clear conflict with our precedent and forebodes a diminution of this Court’s role in controversies involving the separation of powers and the structure of government. I concur in the judgment only …
The first question presented is whether “the Recess of the Senate,” during which the President’s recess-appointment power is active, is (a) the period between two of the Senate’s formal sessions, or (b) any break in the Senate’s proceedings. I would hold that “the Recess” is the gap between sessions and that the appointments at issue here are invalid because they undisputedly were made during the Senate’s session. The Court’s contrary conclusion—that “the Recess” includes “breaks in the midst of a session,” ante, at 9—is inconsistent with the Constitution’s text and structure, and it requires judicial fabrication of vague, unadministrable limits on the recess-appointment power (thus defined) that overstep the judicial role. And although the majority relies heavily on “historical practice,” no practice worthy of our deference supports the majority’s conclusion on this issue …
What does all this amount to? In short: Intra-session recess appointments were virtually unheard of for the first 130 years of the Republic, were deemed unconstitutional by the first Attorney General to address them, were not openly defended by the Executive until 1921, were not made in significant numbers until after World War II, and have been repeatedly criticized as unconstitutional by Senators of both parties. It is astonishing for the majority to assert that this history lends “strong support,” ante, at 11, to its interpretation of the Recess Appointments Clause.
The second question presented is whether vacancies that “happen during the Recess of the Senate,” which the President is empowered to fill with recess appointments, are (a) vacancies that arise during the recess, or (b) all vacancies that exist during the recess, regardless of when they arose. I would hold that the recess-appointment power is limited to vacancies that arise during the recess in which they are filled, and I would hold that the appointments at issue here—which undisputedly filled pre-recess vacancies—are invalid for that reason as well as for the reason that they were made during the session. The Court’s contrary conclusion is inconsistent with the Constitution’s text and structure, and it further undermines the balance the Framers struck between Presidential and Senatorial power. Historical practice also fails to support the majority’s conclusion on this issue …
In sum: Washington’s and Adams’ Attorneys General read the Constitution to restrict recess appointments to vacancies arising during the recess, and there is no evidence that any of the first four Presidents consciously departed from that reading. The contrary reading was first defended by an executive official in 1823, was vehemently rejected by the Senate in 1863, was vigorously resisted by legislation in place from 1863 until 1940, and is arguably inconsistent with legislation in place from 1940 to the present. The Solicitor General has identified only about 100 appointments that have ever been made under the broader reading, and while it seems likely that a good deal more have been made in the last few decades, there is good reason to doubt that many were made before 1940 (since the appointees could not have been compensated). I can conceive of no sane constitutional theory under which this evidence of “historical practice”—which is actually evidence of a long-simmering inter-branch conflict—would require us to defer to the views of the Executive Branch …
What the majority needs to sustain its judgment is an ambiguous text and a clear historical practice. What it has is a clear text and an at-best-ambiguous historical practice …
The real tragedy of today’s decision is not simply the abolition of the Constitution’s limits on the recess-appointment power and the substitution of a novel framework invented by this Court. It is the damage done to our separation-of-powers jurisprudence more generally. It is not every day that we encounter a proper case or controversy requiring interpretation of the Constitution’s structural provisions. Most of the time, the interpretation of those provisions is left to the political branches—which, in deciding how much respect to afford the constitutional text, often take their cues from this Court. We should therefore take every opportunity to affirm the primacy of the Constitution’s enduring principles over the politics of the moment. Our failure to do so today will resonate well beyond the particular dispute at hand. Sad, but true: The Court’s embrace of the adverse-possession theory of executive power (a characterization the majority resists but does not refute) will be cited in diverse contexts, including those presently unimagined, and will have the effect of aggrandizing the Presidency beyond its constitutional bounds and undermining respect for the separation of powers.
I concur in the judgment only.
Lucia v. SEC (2018)
585 U.S. ___ (2018)
Decision: Reversed and remanded
Majority: Kagan, joined by Roberts, Kennedy, Thomas, Alito, and Gorsuch
Concurrence: Thomas, joined by Gorsuch
Concur/dissent: Breyer, joined by Ginsburg, and Sotomayor (Part III only)
Dissent: Sotomayor, joined by Ginsburg
Justice Kagan delivered the opinion of the Court.
The Appointments Clause of the Constitution lays out the permissible methods of appointing “Officers of the United States,” a class of government officials distinct from mere employees … This case requires us to decide whether administrative law judges (ALJs) of the Securities and Exchange Commission (SEC or Commission) qualify as such “Officers.” In keeping with Freytag v. Commissioner, (1991), we hold that they do …
The SEC has statutory authority to enforce the nation’s securities laws. One way it can do so is by instituting an administrative proceeding against an alleged wrongdoer. By law, the Commission may itself preside over such a proceeding … But the Commission also may, and typically does, delegate that task to an ALJ … The SEC currently has five ALJs. Other staff members, rather than the Commission proper, selected them all …
An ALJ assigned to hear an SEC enforcement action has extensive powers—the “authority to do all things necessary and appropriate to discharge his or her duties” and ensure a “fair and orderly” adversarial proceeding … As that list suggests, an SEC ALJ exercises authority “comparable to” that of a federal district judge conducting a bench trial. Butz v. Economou, (1978) …
This case began when the SEC instituted an administrative proceeding against petitioner Raymond Lucia and his investment company. Lucia marketed a retirement savings strategy called “Buckets of Money.” In the SEC’s view, Lucia used misleading slideshow presentations to deceive prospective clients. The SEC charged Lucia under the Investment Advisers Act, and assigned ALJ Cameron Elliot to adjudicate the case. After nine days of testimony and argument, Judge Elliot issued an initial decision concluding that Lucia had violated the Act and imposing sanctions, including civil penalties of $300,000 and a lifetime bar from the investment industry …
On appeal to the SEC, Lucia argued that the administrative proceeding was invalid because Judge Elliot had not been constitutionally appointed. According to Lucia, the Commission’s ALJs are “Officers of the United States” and thus subject to the Appointments Clause … [T]he Commission had left the task of appointing ALJs, including Judge Elliot, to SEC staff members … As a result, Lucia contended, Judge Elliot lacked constitutional authority to do his job …
The sole question here is whether the Commission’s ALJs are “Officers of the United States” or simply employees of the Federal Government. The Appointments Clause prescribes the exclusive means of appointing “Officers.” Only the President, a court of law, or a head of department can do so.
Two decisions set out this Court’s basic framework for distinguishing between officers and employees. Germaine v. US (1879) held that “civil surgeons” (doctors hired to perform various physical exams) were mere employees because their duties were “occasional or temporary” rather than “continuing and permanent … ” Stressing “ideas of tenure [and] duration,” the Court there made clear that an individual must occupy a “continuing” position established by law to qualify as an officer. Buckley v. Valeo (1976) then set out another requirement, central to this case. It determined that members of a federal commission were officers only after finding that they “exercis[ed] significant authority pursuant to the laws of the United States … ” The inquiry thus focused on the extent of power an individual wields in carrying out his assigned functions.
Both the amicus and the Government urge us to elaborate on Buckley’s “significant authority” test, but another of our precedents makes that project unnecessary … [I]n Freytag v. Commissioner, (1991), we applied the unadorned “significant authority” test to adjudicative officials who are near-carbon copies of the Commission’s ALJs. As we now explain, our analysis there (sans any more detailed legal criteria) necessarily decides this case.
The officials at issue in Freytag were the “special trial judges” (STJs) of the United States Tax Court. The authority of those judges depended on the significance of the tax dispute before them. In “comparatively narrow and minor matters,” they could both hear and definitively resolve a case for the Tax Court … In more major matters, they could preside over the hearing, but could not issue the final decision; instead, they were to “prepare proposed findings and an opinion” for a regular Tax Court judge to consider …
This Court held that the Tax Court’s STJs are officers, not mere employees. Citing Germaine, the Court first found that STJs hold a continuing office established by law … They serve on an ongoing, rather than a “temporary [or] episodic[,] basis”; and their “duties, salary, and means of appointment” are all specified in the Tax Code.
For all the reasons we have given, and all those Freytag gave before, the Commission’s ALJs are “Officers of the United States,” subject to the Appointments Clause … This Court has held that “one who makes a timely challenge to the constitutional validity of the appointment of an officer who adjudicates his case” is entitled to relief. Ryder v. United States, (1995). Lucia made just such a timely challenge: He contested the validity of Judge Elliot’s appointment before the Commission, and continued pressing that claim in the Court of Appeals and this Court. So what relief follows? This Court has also held that the “appropriate” remedy for an adjudication tainted with an appointments violation is a new “hearing before a properly appointed” official … And we add today one thing more. That official cannot be Judge Elliot, even if he has by now received (or receives sometime in the future) a constitutional appointment. Judge Elliot has already both heard Lucia’s case and issued an initial decision on the merits. He cannot be expected to consider the matter as though he had not adjudicated it before. To cure the constitutional error, another ALJ (or the Commission itself) must hold the new hearing to which Lucia is entitled.
We accordingly reverse the judgment of the Court of Appeals and remand the case for further proceedings consistent with this opinion.
It is so ordered.
Note: In June of 2020, Lucia entered a settlement with the SEC which banned Lucia from the securities industry, though he could reapply for admittance, and included a fine of $25,000.00. (see https://www.investmentnews.com/sec-ray-lucia-settle-lawsuit-194238, last accessed on April 27, 2023.)