SEC’s Appointments of ALJs Held Unconstitutional
June 27, 2018
By a 7-2 vote in Lucia v. Securities and Exchange Commission, the U.S. Supreme Court held that the SEC’s cadre of administrative law judges (ALJs) are “inferior officers” who may be appointed by the President, the courts or heads of departments…but not SEC staff. The Commission has delegated ALJ appointments to its staff for years. The opinion could have major consequences for past decisions by improperly-appointed ALJs, not only at the SEC but across many federal agencies.