Dan King
Dan King · July 7, 2022

ARLINGTON, Va.—Today, the Institute for Justice (IJ) filed an amicus brief in the United States Supreme Court, which aims to uphold a basic principle of the American system of government: the separation of powers. 

At stake in the case is whether or not federal courts retain their jurisdiction to determine if an executive agency’s structure or procedures are unconstitutional, or if litigants must first go through the very unconstitutional process they are challenging. Typically, when a federal official violates the law, someone injured by that action can sue in federal court to stop the illegal conduct. But as it currently stands, many courts refuse to hear cases when the federal officials accused of violating the Constitution work for federal agencies.   

In 2016, the U.S. Securities and Exchange Commission (SEC) accused Michelle Cochran of violating federal accounting standards, as part of a larger investigation into her former employer. Her case was not heard by an independent court, but rather by the SEC’s own Administrative Law Judges (ALJs). These judges were hired by SEC staff in violation of the Appointments Clause. Cochran already had to defend herself in front of an unconstitutional ALJ once, and now the SEC wants her to go through the process a second time before she can ask a court to rule that the ALJs are still unconstitutional.   

Cochran’s case started before an ALJ because the SEC gets to choose whether it wants to file charges with its own ALJs, rather than in federal court. If the agency chooses to go the ALJ route, an expensive and timely administrative proceeding occurs. Only after that process is complete can the losing party appeal the decision to a federal court of appeals to finally challenge the constitutionality of the process they had to go through. No law requires this unnecessary process. But under a judge-made doctrine called “implied jurisdiction stripping,” the courts choose to infer from a law’s complexity that Congress would prefer that the courts withhold their jurisdiction until after the conclusion of this lengthy administrative process. 

“Under our system of government, the federal courts have an obligation to stop federal officials when they violate the Constitution. But the Supreme Court’s ‘implied jurisdiction stripping’ doctrine requires courts to abdicate that duty when faced with allegations that the executive branch is acting unconstitutionally,” said IJ Attorney Jared McClain. “Closing the court doors in constitutional cases violates the separation of powers and denies due process to people who are guaranteed their day in court.” 

Since 2012, federal appeals courts have refused to let people bring constitutional challenges to the SEC’s structure and procedures directly in federal court. Then, in December 2021, the 5th U.S. Circuit Court of Appeals ruled that the judicial branch did indeed have jurisdiction to review constitutional claims like the one Cochran raised. The circuit split that decision created led the Supreme Court to grant review. IJ’s brief urges the Supreme Court to return the judiciary to its constitutional role by ruling that Congress never silently strips the courts of their jurisdiction—especially in constitutional cases.  

IJ has fought back against other forms of administrative overreach, including a case in New Jersey where a family farm was issued a $550,000 citation from the Department of Labor (DOL) based primarily on a single paperwork violation. When the owners attempted to challenge the fine, they were subjected to a series of hearings in front of DOL judges, not real judges. With IJ’s help, they’re fighting for their day in a real court.