Peter M. Shane is the Jacob E. Davis and Jacob E. Davis II Chair in Law at the Ohio State University Moritz College of Law. He was part of an amicus brief of constitutional and administrative law scholars in support of the SEC in Lucia v. Securities and Exchange Commission. In 2004, Harvard law professor […]
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Peter M. Shane is the Jacob E. Davis and Jacob E. Davis II Chair in Law at the Ohio State University Moritz College of Law. He was part of an amicus brief of constitutional and administrative law scholars in support of the SEC in Lucia v. Securities and Exchange Commission.
In 2004, Harvard law professor Mark Tushnet wrote an influential article called “Constitutional Hardball.” By that term, he was referring to moves by the political branches of government that are “without much question within the bounds of existing constitutional doctrine,” but that conspicuously violate the conventional assumptions or conventions about institutional behavior that underlie that doctrine. A recent example Tushnet might have been able to foretell would be the 2016 decision of the Republican Senate majority to hold open Justice Antonin Scalia’s Supreme Court seat rather than consider the nomination of Chief Judge Merrick Garland to be Scalia’s successor.
The Supreme Court’s decision today in Lucia v. Securities and Exchange Commission, along with its other much-anticipated decisions, Masterpiece Cakeshop, Ltd. v. Colorado Civil Rights Commission and Gill v. Whitford, seems to be playing a different game, which I’ll call “Constitutional dodgeball.” It is roughly akin to what Alexander Bickel called the “passive virtues” or what Cass Sunstein has labeled “judicial minimalism,” although, in each of these three cases, the court did reach and decide a question of constitutional magnitude. It is just that the justices chose and decided the constitutional issue in front of them in a way that conspicuously appeared to avoid, at least temporarily, the questions of constitutional interpretation that, in each case, were most ideologically laden.
Tushnet attributed what he called hardball to its practitioners’ perception of the stakes at play: “[P]ractitioners see themselves as playing for keeps in a special kind of way; they believe the stakes of the political controversy their actions provoke are quite high, and that their defeat and their opponents’ victory would be a serious, perhaps permanent setback to the political positions they hold.” In a time of intense political polarization, Constitutional dodgeball may appear an attractive strategy for justices who are aware that the cases involved also have very high stakes politically — perhaps even more than legally — and who do not want to be associated with legal reasoning that could also be interpreted as “a serious, perhaps permanent setback” to one or another political faction.
It may seem surprising to cast Lucia in these terms because, surely for most citizens, the case hardly seems to implicate the intensity of either partisan fights over gerrymandering or culture-war fights over gay marriage and religious belief. Yet the case did become a target for high-octane disputation because of its potential place in bolstering a view of government known as presidentialism and an ideology of constitutional interpretation called originalism.
The specific issue in Lucia was, of course, narrow — whether Administrative Law Judges reporting to the Securities and Exchange Commission are “officers,” who must be appointed through some method spelled out in Article II of the Constitution, or just “employees,” whose appointment could follow some other process designed by Congress. Had the SEC members — collectively, the “head of a Department,” in Article II terms — appointed the ALJ for Lucia’s case, there would have been no appointments controversy. All sides agreed that, even if the SEC ALJs are officers, they would be “inferior” officers whom Congress may permit the head of a department to appoint. What created the constitutional problem was the SEC’s decision to delegate its appointment authority for ALJs to its Office of Human Resources, a method Article II does not approve.
Deciding, as the Supreme Court did, that the SEC must itself appoint its ALJs would seem a matter of limited practical consequence — a point to which I will return. But, as the majority reflects in a footnote, the Trump administration’s solicitor general, having abandoned the Obama administration’s defense of the SEC, also asked the court to decide that the ALJs could not constitutionally be insulated from the possibility of at-will removal or its very near equivalent. Though the court declined to pose the removability question to the parties, the solicitor general briefed it anyway. And the court, in a footnote, “once more decline[d]” the invitation to discuss the issue.
Had the justices entered the removal controversy, the Lucia opinion could have had profound practical consequences, and would certainly have had considerable ideological significance. That is, had the Supreme Court determined that an independent agency’s ALJs had to be removable more or less at will, Lucia would have potentially upended a large swath of the federal administrative adjudicatory bureaucracy, which includes over 1,300 tenure-protected ALJs working for the Social Security Administration.
But however it decided the removal issue, the Supreme Court would also have had to take sides, implicitly or not, in the heated debate over legitimate methods for constitutional interpretation. Very strikingly, the court’s majority not only sidestepped the removal question, but it carefully disdained any talk of interpretive method in reaching its conclusion on the appointments controversy. Justice Elena Kagan’s opinion relies entirely on stare decisis – or adherence to the court’s own precedent. In a 1991 case, Freytag v. Commissioner, the court held that special trial judges of the United States Tax Court were officers, not employees. Concluding now that the special trial judges were “near-carbon copies of the Commission’s ALJs,” the majority goes on to declare, “Freytag says everything necessary to decide this case.”
The only opinion to delve into constitutional method is the concurrence of Justices Clarence Thomas and Neil Gorsuch, who write separately to declare their preference for a version of originalist constitutional interpretation that purportedly rests on the “original public meaning” of the Constitution’s terms. Eschewing any earlier Supreme Court decision’s more nuanced approach to the identification of officers, they would hold that the word “officer” “encompass[es] all federal civil officials who perform an ongoing, statutory duty—no matter how important or significant the duty.”
Had a majority of the court embraced the Thomas-Gorsuch approach, it would have been a very big deal — for some observers, maybe even a bigger deal than the limited practical consequence now facing the SEC, namely, appointing its ALJs directly and giving Lucia another hearing.
The clues to the “bigness” of the deal lie in the solicitor general’s unconventional advocacy and in the fact that amici weighing in for Lucia’s view included the U.S. Chamber of Commerce, the Pacific Legal Foundation and the Cato Institute. Advocating for a more politicized appointment of administrative judges might at first seem an odd stance for the business community; the whole point of putting administrative adjudication in the hands of quasi-independent functionaries was to afford respondents like Lucia an adjudicator not “in the pocket” of the accusing agency. Wanting ALJs to be more directly accountable to the SEC would seem, from a fairness point of view, to be against, rather than for, the interests of investment firms.
I can imagine at least two possible reasons why investing in Lucia’s case would seem worthwhile for regulated businesses. First, they may believe in their own ability to “capture” the agencies that regulate them. Certainly, the Trump administration is awash in administrators friendlier to business than the chamber might ever have hoped for. To the extent Americans choose conservative presidents, those presidents are likely to choose more pro-business regulators. Putting the choice of administrative adjudicators in their hands may seem an appealing goal.
But playing a long game, the appeal of a case like Lucia may have lain also with the hope that a fully staffed post-Scalia court would offer a full-throated endorsement of originalism in a separation-of-powers case that could play itself out across a range of other issues. In the halls of academe (and the Federalist Society), there is no shortage of originalist arguments that purport to demonstrate the unconstitutionality of the regulatory state itself. As someone who is not an originalist in the Scalia-Thomas-Gorsuch mold and who also thinks the constitutional arguments against the regulatory state to be unfounded, I consider the stakes in a case like Lucia to be very high indeed. To paraphrase Tushnet, I would regard the ideological defeat of constitutional pragmatism and the originalists’ victory as “a serious, perhaps permanent setback” to sensible constitutional thinking about the administrative state.
Kagan, as it happens, is not an originalist. She is a pragmatist, who — unfortunately, from my standpoint — probably takes the view (as reflected in her earlier scholarship) that linking public administration more closely to presidential oversight improves administrative performance and bureaucratic accountability. I do not doubt that Lucia’s constitutional claim would resonate with her on pragmatist grounds, which may help explain why she would not join Justice Stephen Breyer’s suggestion to resolve the case based entirely on the wording of the Administrative Procedure Act. Yet as I have written elsewhere and at length, I think that position is incorrect — also on pragmatist grounds — and so I find myself grateful for the court’s game of dodgeball in Lucia. One problem with dodgeball is that no one can play it forever, but today, at least, no one got seriously bruised.
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