Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca11-15-13738/USCOURTS-ca11-15-13738-0/pdf.json

Nature of Suit Code: 899
Nature of Suit: Other Statutes - Administrative Procedure Act/Review or Appeal of Agency Decision
Cause of Action: 

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[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

________________________

No. 15-12831

________________________

D.C. Docket No. 1:15-cv-01801-LMM

CHARLES L. HILL, JR., 

 Plaintiff - Appellee,

versus

SECURITIES AND EXCHANGE COMMISSION, 

 Defendant - Appellant.

________________________

No. 15-13738

________________________

D.C. Docket No. 1:15-cv-00492-LMM

GRAY FINANCIAL GROUP, INC., 

LAURENCE O. GRAY, 

ROBERT C. HUBBARD, IV, 

 Plaintiffs - Appellees,

versus

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2

U.S. SECURITIES AND EXCHANGE COMMISSION, 

 Defendant - Appellant.

________________________

Appeals from the United States District Court

for the Northern District of Georgia

________________________

(June 17, 2016)

Before ED CARNES, Chief Judge, JILL PRYOR and RIPPLE,

* Circuit Judges.

JILL PRYOR, Circuit Judge: 

Congress authorized the Securities and Exchange Commission (“SEC” or 

the “Commission”) to bring civil actions to enforce violations of the Securities 

Exchange Act of 1934 (the “Exchange Act”) and regulations promulgated 

thereunder. The Commission is empowered to bring such an action either in 

federal district court or in an administrative proceeding before the Commission. 

See 15 U.S.C. §§ 78u(d), 78u-1, 78u-2, 78u-3. An SEC administrative 

enforcement action culminates in a final order of the Commission, which in turn is 

reviewable exclusively by the appropriate federal court of appeals. 15 U.S.C. 

§ 78y. 

 * Honorable Kenneth F. Ripple, United States Circuit Judge for the Seventh Circuit, 

sitting by designation.

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The issue presented in this consolidated appeal is whether respondents in an 

SEC administrative enforcement action can bypass the Exchange Act’s review 

scheme by filing a collateral lawsuit in federal district court challenging the 

administrative proceeding on constitutional grounds. In both now-consolidated 

cases, the district court held that it had jurisdiction to entertain such challenges. 

The court further concluded that at least one of the constitutional claims presented 

was substantially likely to succeed on the merits. To avoid what it determined

would be irreparable harm, the district court enjoined the administrative 

proceedings. The Commission appealed. 

After consideration of the parties’ briefs and with the benefit of oral 

argument, we conclude that the district court lacked jurisdiction over the 

respondents’ collateral attacks. We find it “fairly discernible” from the review

scheme provided in 15 U.S.C. § 78y that Congress intended the respondents’ 

claims to be resolved first in the administrative forum, not the district court, and 

then, if necessary, on appeal to the appropriate federal court of appeals. Thunder 

Basin Coal Co. v. Reich, 510 U.S. 200, 207 (1994) (internal quotation marks 

omitted). We see no indication that Congress intended to exempt the type of 

claims the respondents raise here from the review process it created. See id.; Elgin 

v. Dep’t of Treasury, 132 S. Ct. 2126, 2136-40 (2012). Accordingly, we vacate the 

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district court’s preliminary injunction orders and remand with instructions to 

dismiss the actions for lack of jurisdiction.

I. BACKGROUND

A. SEC Administrative Proceedings and Judicial Review

SEC administrative actions differ from cases brought in federal district court 

in several respects. The administrative action begins when the Commission serves 

the respondent with an Order Instituting Proceedings (“OIP”). The Commission 

then presides over the action, but it typically delegates review to an Administrative 

Law Judge (“ALJ”). See 15 U.S.C. § 78d-1(a)-(b); 17 C.F.R. § 201.110. Unlike 

an action brought in federal court, in a proceeding before the Commission the 

Federal Rules of Civil Procedure and Evidence do not apply, and the respondent 

does not enjoy the right to a jury trial. Instead, the SEC’s Rules of Practice, 17 

C.F.R. § 201.100 et seq., govern administrative proceedings. Among other 

differences, the Rules of Practice provide for more limited discovery. For 

example, the Rules of Practice allow the taking of depositions at the Commission’s 

discretion, only upon a finding that the prospective witnesses will be unavailable to 

testify at the hearing. Id. §§ 201.233(b), 201.234(a). The Rules of Practice also do 

not provide for routine document production, instead requiring parties to request 

that the ALJ issue subpoenas. See id. § 201.232. Administrative actions proceed 

relatively quickly along fixed timelines set by the rules. See id. § 201.360(a)(2). 

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When the Commission delegates review to an ALJ, the ALJ holds an 

evidentiary hearing and then renders an initial decision with factual findings and 

conclusions of law. Id. § 201.360(a)(1), (b). Either party may appeal the initial 

decision to the Commission, id. § 201.410, or the Commission may review it on its 

own initiative. Id. § 201.411(c). The Commission’s review authority is broad. 

“[It] may affirm, reverse, modify, set aside or remand for further proceedings, in 

whole or in part, an initial decision by a hearing officer and may make any findings 

or conclusions that in its judgment are proper and on the basis of the record.” Id.

§ 201.411(a). Conversely, if there is no appeal to the Commission, and the 

Commission declines to exercise its right to review sua sponte, the ALJ’s initial 

decision becomes the final decision of the Commission for all purposes. 15 U.S.C. 

§ 78d-1(c). Regardless of whether the initial decision is appealed, the 

administrative process culminates in a final order of the Commission.

The aggrieved party may then seek review in the United States Court of 

Appeals either for the circuit in which she resides or has her principal place of 

business or for the District of Columbia Circuit. 15 U.S.C. § 78y(a)(1). The 

aggrieved party may request that the Commission stay enforcement of its order 

pending judicial review. 17 C.F.R. § 201.401. Section 78y then provides a 

detailed scheme for appellate court review of final Commission orders. 

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The process of obtaining judicial review begins with the filing of a petition 

in the court of appeals that triggers the court’s jurisdiction. 15 U.S.C. § 78y(a)(1), 

(3). Upon the filing of the record in the court of appeals, the court’s jurisdiction 

becomes exclusive. Id. § 78y(a)(3). Although other provisions of the Exchange 

Act provide limited district court jurisdiction over some types of securities-related 

claims,1 the Act contains no express authorization for district court review of a 

final Commission order.

Section 78y then details how the court of appeals reviews a final order of the 

Commission. The statute grants the reviewing court broad authority “to affirm or 

modify and enforce or to set aside the [final Commission] order in whole or in 

part.” Id. § 78y(a)(3). The reviewing court must accept the Commission’s factual 

findings that are supported by substantial evidence, but, if appropriate, the court 

may remand to the Commission for additional fact finding. Id. § 78y(a)(4)-(5). 

The statute prohibits the reviewing court from considering a newly-raised 

objection to a final Commission order unless there was “reasonable ground” for 

failing to raise the objection first before the Commission. Id. § 78y(c)(1). The 

statute generally authorizes the reviewing court to stay enforcement of the 

 1 See, e.g., id. §§ 78u(d), 78u-1, and 78u-3 (authorizing the Commission to seek, in 

federal district court, injunctive relief, civil penalties, or a temporary escrow order).

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Commission’s order pending judicial review “to the extent necessary to prevent 

irreparable injury.” Id. § 78y(c)(2).

B. Factual Background

1. Charles L. Hill, Jr.

The respondent in the first case in this consolidated appeal is Charles L. Hill,

Jr., a real estate developer in Georgia who is not registered with the SEC. In June 

and early July, 2011, Mr. Hill purchased several thousand shares of stock in a 

company called Radiant Systems, Inc. (“Radiant”). On July 11, 2011, after the 

markets closed, Radiant announced a merger agreement with NCR Corporation. 

The next day, Mr. Hill sold all of his Radiant shares, profiting in the amount of 

approximately $744,000. Mr. Hill maintained that he was unaware of the merger 

before its public announcement. Nonetheless, in February 2015, after a two-year 

investigation in which Mr. Hill cooperated fully with the SEC, the Commission 

served him with an OIP. The SEC sought a cease and desist order, a civil penalty, 

and disgorgement, alleging that Mr. Hill unlawfully profited from non-public 

information.

The ALJ scheduled a hearing on the OIP for June 15, 2015. In the 

meantime, Mr. Hill filed two motions for summary disposition, the first 

challenging the merits of the claims against him and the second raising as 

affirmative defenses constitutional arguments going to the heart of the 

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administrative process itself. Specifically, in the second motion Mr. Hill argued 

that (1) the administrative proceeding violates the removal protections of Article II 

of the United States Constitution because ALJs are protected by two layers of 

tenure, (2) administrative enforcement actions before an ALJ violate the nondelegation doctrine under Article I of the Constitution, and (3) the grant of 

discretion to the Commission to bring this action in an administrative forum

violates his Seventh Amendment right to a jury trial. In separate orders, the ALJ 

denied both motions. As regards the constitutional issues, the ALJ concluded that 

he lacked authority to rule on the constitutionality of a particular provision of the 

Exchange Act and thus could not resolve Mr. Hill’s second and third arguments. 

The ALJ also expressed doubt that he had the authority to reach Mr. Hill’s first 

argument, but nonetheless rejected it on the merits.

Five days after the ALJ issued his order on Mr. Hill’s constitutional 

challenges, Mr. Hill filed in federal district court a complaint and motion for a 

temporary restraining order seeking to enjoin the SEC proceedings. Mr. Hill raised 

the same constitutional arguments in the district court that he had raised before the 

ALJ and, in an amended complaint, added an additional claim under the

Appointments Clause of Article II of the Constitution. This new claim asserted

that, as constitutional inferior officers, the ALJs must be appointed by the 

President, department heads, or courts of law. Because the SEC conceded that 

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ALJs are not appointed in that manner, Mr. Hill contended that the appointment of 

the ALJ in his case was unconstitutional. The SEC countered that the district court 

lacked jurisdiction over these claims because Congress designated the 

administrative forum and appeal procedure of § 78y as the exclusive avenue for 

deciding them. The SEC also disputed the merits of Mr. Hill’s claims.

After oral argument, the district court issued a thorough order rejecting the 

SEC’s jurisdictional argument and holding that the Commission’s ALJs were 

inferior officers subject to the Appointments Clause. Because the ALJ was not 

appointed by the President, department heads, or courts of law, the district court

held, the ALJ’s appointment likely was unconstitutional.2

 On this basis, the court 

granted Mr. Hill’s motion for a temporary restraining order. Hill v. SEC, 114 F. 

Supp. 3d 1297, 1320 (N.D. Ga. 2015). The Commission appealed.

2. The Gray Respondents

The second case in this consolidated appeal was brought by Gray Financial 

Group, Inc. (“Gray Financial”), its founder and principal Laurence O. Gray, and its 

Co-Chief Executive Officer Robert C. Hubbard (collectively the “Gray 

respondents”). Gray Financial is an investment advisory firm registered with the 

SEC and the States of Georgia and Michigan. The firm provides financial 

 2 The court declined to reach whether the ALJ’s two-layer tenure system violated Article 

II’s removal protections and rejected Mr. Hill’s remaining arguments.

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consulting services to a variety of public and private entities. In August 2013, the 

Commission began investigating whether Gray Financial complied with the 

Georgia Public Retirement Systems Investment Authority Law (“Georgia Pension 

Law”), O.C.G.A. § 47-20-87. After about a year, the SEC reached a preliminary 

conclusion that the Gray respondents had violated federal securities laws by 

offering an investment fund not in compliance with the Georgia Pension Law. The 

SEC urged the Gray respondents to settle or else they would risk an enforcement 

action brought in an administrative proceeding.

Based on the SEC’s threat, in February 2015 the Gray respondents filed a 

complaint in federal district court seeking to enjoin the impending SEC 

administrative proceeding and requesting a declaratory judgment that the dual 

layer of tenure for SEC ALJs violates the removal protections of Article II. In 

May 2015, the Commission served the Gray respondents with an OIP, initiating an 

administrative enforcement action against them. The Gray respondents then filed 

an amended complaint, adding the allegation that the appointments process for 

SEC ALJs also violates Article II. Then, on June 15, 2015, the Gray respondents 

filed a motion for preliminary injunction.

After oral argument, the district court—with the same judge presiding as in 

Mr. Hill’s case—again concluded that it had subject matter jurisdiction and that the 

hiring of SEC ALJs violated the Appointments Clause because the ALJs were 

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inferior officers under the Constitution. The district court thus granted the Gray 

respondents’ motion for a preliminary injunction. Gray Fin. Grp., Inc. v. SEC, No. 

1:15-cv-0492-LMM, 2015 WL 10579873, at *16 (N.D. Ga. Aug. 4, 2015). The 

Commission appealed. Upon the respondents-appellees’ consent motion, we 

consolidated the Commission’s two appeals.

II. ANALYSIS

We review the district court’s determination of subject matter jurisdiction de 

novo. Doe v. FAA, 432 F.3d 1259, 1261 (11th Cir. 2005). Federal district courts 

generally have jurisdiction over claims raising constitutional challenges that seek

declaratory and injunctive relief. See 28 U.S.C. §§ 1331, 2201. Congress may

allocate initial review of such claims to an administrative body, however. See 

Thunder Basin, 510 U.S. at 207. To determine whether Congress has done so, we 

first decide whether its intent to preclude initial review in the district court is 

“fairly discernible in the statutory scheme.” Id. (internal quotation marks omitted); 

see also Elgin, 132 S. Ct. at 2133-33. We then ask whether the litigants’ “claims 

are of the type Congress intended to be reviewed within this statutory structure.” 

Thunder Basin, 510 U.S. at 212; accord Elgin, 132 S. Ct. at 2136-40. The second 

part of our analysis focuses on whether the litigant’s claims will receive 

meaningful judicial review within the statutory structure. See Thunder Basin, 510 

U.S. at 212-14; Free Enter. Fund v. Pub. Co. Accounting Oversight Bd., 561 U.S. 

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477, 490-91 (2010). We also consider whether “agency expertise could be brought 

to bear on the . . . questions presented” and the extent to which the litigants’ claims 

are “wholly collateral to [the] statute’s review provisions.” Thunder Basin, 510 

U.S. at 212, 214-15 (alteration adopted and internal quotation marks omitted).

The Supreme Court applied this framework in three cases that guide our 

analysis here. In the first, Thunder Basin Coal Company v. Reich, the Court held 

that a statutory review procedure applicable to regulations promulgated under the

Federal Mine Safety and Health Amendments Act of 1977, 30 U.S.C. § 801 et seq.

(the “Mine Act”), which is nearly identical to the review procedure under the 

Exchange Act at issue here, precluded preenforcement judicial review in the 

district court of a constitutional challenge to a Mine Act regulation. Thunder 

Basin, 510 U.S. at 218. The Court reached a contrary conclusion in Free 

Enterprise Fund v. Public Company Accounting Oversight Board, however. 561 

U.S. 477. There, the Supreme Court held that 15 U.S.C. § 78y, the same statutory 

review procedure at issue in this case, did not clearly indicate Congressional intent 

to preclude initial review in the district court of a challenge to the existence of the 

Public Company Accounting Oversight Board (the “PCAOB”), a private nonprofit 

corporation under the SEC’s oversight, whose actions do not necessarily result in a 

final Commission order or rule. Id. at 489-91. And finally, in Elgin v. Department 

of the Treasury, the Court held that it was fairly discernible from the review

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process in the Civil Service Reform Act of 1978 (“CSRA”), 5 U.S.C. § 1101 et 

seq., that Congress intended to preclude district court jurisdiction over a 

constitutional challenge to a statute authorizing the termination of federal 

employees who failed to register for the Selective Service. 132 S. Ct. at 2140.

Applying the Thunder Basin two-part framework based on our reading of 

these three Supreme Court cases, discussed in more detail below, persuades us that 

the respondents’ claims in this case must proceed initially in the administrative 

forum and then through the judicial review scheme Congress established in § 78y. 

We therefore conclude, consistent with three of our sister circuits, that the district 

court lacked subject matter jurisdiction. See Tilton, et al. v. SEC, __ F.3d__, No. 

15-2103, 2016 WL 3084795 (2d Cir. June 1, 2016); Jarkesy v. SEC, 803 F.3d 9 

(D.C. Cir. 2015); Bebo v. SEC, 799 F.3d 765 (7th Cir. 2015), cert. denied, 136 S. 

Ct. 1500 (2016).

3

A. Whether Congressional Intent to Preclude District Court Review of 

SEC Administrative Proceedings Is “Fairly Discernible in the Statutory 

Scheme”

Applying the test established in Thunder Basin, we first must decide whether 

it is “fairly discernible” from the “text, structure, and purpose” of § 78y that 

Congress intended this statute to provide the exclusive means for judicial review of 

 3 The decisions in Bebo and Jarkesy were unanimous. The Fourth Circuit is also 

considering this jurisdictional issue. See Bennett v. SEC, No. 15-2584 (4th Cir. appeal docketed 

Dec. 28, 2015).

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an SEC administrative action. Elgin, 132 S. Ct. at 2133 (internal quotation marks 

omitted). We discern from the text of the statute that Congress sought to foreclose 

district court review of administrative proceedings. See id.; Thunder Basin, 510 

U.S. at 207-09. 

Thunder Basin is particularly instructive. At issue there was 30 U.S.C. 

§ 816(a), the statutory scheme Congress provided for reviewing decisions of the 

Federal Mine Safety and Health Review Commission (the “Mine Safety 

Commission”). Id. at 207-12. The Mine Safety Commission is authorized to 

impose civil monetary penalties for, among other infractions, violations of the 

regulations promulgated under the Mine Act. Id. at 204, 208. The petitioner, 

Thunder Basin Coal Company (“Thunder Basin”), filed a lawsuit in federal district 

court to challenge one such regulation, arguing among other points that requiring it 

to undergo a statutory review process similar to the process set forth in § 78y 

violated its rights under the Due Process Clause of the Fifth Amendment. Id. at 

204-05. The Court held that the text and structure of the Mine Act demonstrated 

Congress’s intent to preclude the petitioner’s challenge in federal district court. Id.

at 207-09.

As the District of Columbia Circuit recognized in Jarkesy, the text of the 

Mine Act’s judicial review provisions at issue in Thunder Basin are “nearly 

identical” to those governing SEC final orders at issue here. Jarkesy, 803 F.3d at 

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16-17. Both schemes provide exclusive jurisdiction upon the filing of the record in 

the appropriate court of appeals and grant broad authority to that court to affirm, 

modify, enforce, or set aside a final agency order in whole or in part. Compare 15 

U.S.C. § 78y(a)(1)-(3), with 30 U.S.C. § 816(a)(1). The Mine Act and the 

Exchange Act both also circumscribe, in essentially the same manner, the appellate 

court’s authority to consider new arguments, reject findings of fact, remand for 

additional fact finding, or issue a stay. Compare 15 U.S.C. § 78y(a), with 30 

U.S.C. § 816(a). We agree with Jarkesy that § 78y is materially indistinguishable 

from § 816(a) and thus evinces Congressional intent to resolve challenges to 

Commission orders first in the administrative forum and then on appeal to the 

appropriate courts of appeal.

We find Elgin similarly helpful. In Elgin, the Supreme Court considered the 

CSRA’s “comprehensive system for reviewing personnel action taken against 

federal employees.” Elgin, 132 S. Ct. at 2130 (internal quotation marks omitted). 

The CSRA set forth in “painstaking detail” the method for covered employees to 

obtain review of adverse employment actions, first before the Merit Systems 

Protection Board (“MSPB”) and then on appeal exclusively to the United States 

Court of Appeals for the Federal Circuit. Id. at 2134; see also id. at 2130-31 

(citing 5 U.S.C. §§ 7513(d), 7701(a)(1)-(2), 7703(b)(1); 28 U.S.C. § 1295(a)(9)). 

The CSRA’s review provision applies to “[a]ny employee or applicant for 

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employment adversely affected or aggrieved by a final order or decision of the 

[MSPB].” 5 U.S.C. § 7703(a)(1). The Supreme Court held that given the 

comprehensive and detailed statutory review scheme set forth in the CSRA, it was 

“fairly discernible that Congress intended to deny [covered] employees an 

additional avenue of review in district court.” Elgin, 132 S. Ct. at 2134. 

Likewise, § 78y makes it clear that Congress intended to preclude parallel 

federal district court litigation involving challenges to final Commission orders. 

Although perhaps not painstaking, the detail in § 78y indicates that Congress 

intended to deny aggrieved parties another avenue for review. Moreover, like the 

CSRA, § 78y is comprehensive, covering all final Commission orders without 

exception. We are thus convinced that Congress intended any challenge to a final 

Commission order, even one framed as a constitutional challenge to the 

administrative process itself, to receive judicial review under § 78y.

The Supreme Court’s decision in Free Enterprise Fund, which construed 

§ 78y’s reach, does not require a contrary conclusion. There, the PCAOB began a 

formal investigation into the auditing practices of an accounting firm. Free Enter. 

Fund, 561 U.S. at 487. The firm and an associated nonprofit organization then 

sued the PCAOB in federal district court, arguing that the PCAOB’s existence was 

unconstitutional because, among other reasons, its members were not properly 

appointed pursuant to the Appointments Clause. Id. The PCAOB responded that 

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§ 78y governed the petitioner’s challenge, and therefore the case must be dismissed 

for lack of jurisdiction. The Supreme Court disagreed. “Section 78y provides only 

for judicial review of Commission action,” the Court reasoned, “and not every 

[PCAOB] action is encapsulated in a final Commission order or rule.” Id. at 490. 

In other words, although the text of § 78y covered all final Commission orders, it 

did not cover all PCAOB action. Thus, the Supreme Court summarily rejected the 

government’s argument that § 78y indicated Congressional intent to direct the 

petitioner’s challenge into the administrative forum. Id. at 489. 

Here, in contrast, the respondents do challenge Commission action—action 

which, if allowed to proceed, necessarily will result in a final Commission order. 

Section 78y provides that respondents must raise all objections to an order of the

Commission before it becomes final or risk waiving the objection on appeal. See 

15 U.S.C. § 78y(c)(1). The respondents’ constitutional challenges are essentially 

objections to forthcoming Commission orders; thus, they fall within the fairly 

discernible scope of § 78y’s review procedures. 

The respondents argue, and the district court concluded, that because the 

Exchange Act contemplates that some SEC violations may be resolved in district 

court rather than administrative proceedings, we cannot fairly discern 

Congressional intent to foreclose the respondents’ challenges in this case. See Hill, 

114 F. Supp. 3d at 1306 (“There can be no ‘fairly discernible’ Congressional intent 

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to limit jurisdiction away from district courts when the text of the statute provides 

the district court as a viable forum.”). We disagree. 

Most of the provisions on which the respondents rely expressly grant the 

government, not the respondent, the discretion to bring the action in the district 

court. See, e.g., 15 U.S.C. §§ 78u(d), 78u-1, 78u-3 (the Commission); Id. §§ 78dd2(d), 78dd-3(d) (the Attorney General). We agree with the D.C. Circuit in Jarkesy

that “Congress granted the choice of forum to the [government], and that authority 

could be for naught if respondents . . . could countermand the [government’s]

choice by filing a court action.” Jarkesy, 803 F.3d at 17; see also Tilton, 2016 WL 

3084795, at *3 n.3 (“Congress’s decision to vest the SEC with a choice between 

forums does not imply that the chosen forum should not be exclusive of the other. 

To the contrary—without such exclusivity, the SEC’s statutory power to choose 

would be illusory.”).

The remaining provisions the respondents highlight grant limited district 

court jurisdiction in special circumstances, standing in sharp contrast to § 78y’s 

broad scope. As two examples, § 78u-3(d) grants the federal district courts narrow 

jurisdiction to review and, if appropriate, set aside, limit, or suspend a temporary 

cease-and-desist order entered by the Commission, and § 78u-6(h)(1)(B) 

authorizes a whistleblower to file a civil action in district court. See also 15 U.S.C. 

§ 78bb(f)(2) (authorizing removal of securities class actions from state court to 

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federal district court). That Congress carved out limited instances in which the 

district courts have jurisdiction over actions under the Exchange Act does not 

persuade us that Congress also intended for challenges to forthcoming Commission 

orders in administrative enforcement actions to be heard in district court. 

We also find unpersuasive the respondents’ reliance on Abbott Laboratories

v. Gardner and the Exchange Act’s savings clause, 15 U.S.C. § 78bb(a)(2). In 

Abbott Laboratories, the Supreme Court held that a preenforcement challenge to 

regulations promulgated under one section of the Federal Food, Drug, and 

Cosmetic Act, as amended, 21 U.S.C. § 301 et seq. (“FDCA”), could be brought in 

federal district court despite a statutory review procedure applicable to a different 

section of the FDCA. Abbott Labs. v Gardner, 387 U.S. 136, 144-45 (1967), 

abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1977). This 

decision rested on the narrow nature of the review statute at issue, which provided

“special-review procedures,” id. at 142 (emphasis added), only for “certain 

enumerated kinds of regulations, not encompassing those of the kind involved” in 

that case, id. at 141 (footnote omitted). Based on this limiting language, the Court 

concluded that the “special-review procedures” should be read narrowly; only

those special agency decisions covered by the statute must be resolved under the 

review scheme. Id. at 144-145. And the FDCA’s savings clause—which stated 

that “‘[t]he remedies provided for in this subsection shall be in addition to and not 

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in substitution for any other remedies provided by law,’”—“buttressed” the Court’s 

conclusion. Id. at 144 (quoting 5 U.S.C. § 701(f)(6) (1966)).

The respondents assert that, like the savings clause in Abbott Laboratories, 

the savings clause in the Exchange Act, 15 U.S.C. § 78bb(a)(2), supports the 

conclusion that Congress intended to preserve the district court’s authority to hear 

constitutional challenges like the ones they raise here. It is true that the two 

savings clauses are substantially similar.4

 But unlike the narrow review statute in 

Abbott Laboratories, § 78y covers all timely-raised objections to a Commission’s 

final order, without qualification. By its terms, § 78y includes the constitutional 

objections respondents raise here. Abbott Laboratories is therefore inapposite.5

 

Finally, we are unpersuaded by Mr. Hill’s argument that had Congress 

wanted to preclude judicial review of his claims in the district court, it could have 

been clearer. Under the first step of our analysis, we do not require absolute

clarity. Instead, we simply ask whether Congress’s intent to preclude district court 

 4 Section 78bb(a)(2) states, “Except as provided in subsection (f), [which is inapplicable 

here,] the rights and remedies provided by this chapter shall be in addition to any and all other 

rights and remedies that may exist at law or in equity.”

5 McNary v. Haitian Refugee Center, Inc., 498 U.S. 479 (1991), also does not compel a 

different conclusion. In McNary, the Supreme Court held that the limited judicial review 

provision of § 210(e) of the Immigration and Nationality Act, U.S.C. § 1160(e), which applies 

only to “‘a determination respecting an application for adjustment of status,’” did not preclude 

“general collateral challenges to unconstitutional practices and policies used by the agency in 

processing applications.” McNary, 498 U.S. at 492 (quoting 8 U.S.C. § 1160(e)(1)). The text of 

the statute indicated that it was meant to cover a “single act rather than a group of decisions or a 

practice or procedure.” Id. Conversely, as noted above, § 78y contemplates review of any 

objection to a final Commission order, without limitation. See 15 U.S.C. § 78y(c)(1).

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review of the administrative proceeding is “fairly discernible in the statutory 

scheme.” Thunder Basin, 510 U.S. at 207 (internal quotation marks omitted). We 

conclude that it is.

B. Whether the Respondents’ Claims “Are of the Type Congress Intended 

to Be Reviewed within the Statutory Structure”

We next turn to whether the specific claims the respondents raise “are of the 

type Congress intended to be reviewed within this statutory structure.” Id. at 212. 

To make this determination, we first consider whether “a finding of preclusion 

could foreclose all meaningful judicial review” of the respondents’ claims. Id. at 

212-13; see also Free Enter. Fund, 561 U.S. at 489. We agree with the Second 

and Seventh Circuits that the first factor—meaningful judicial review—is “the 

most critical thread in the case law.” Bebo, 799 F.3d at 774; accord Tilton, 2016 

WL 3084795, at *4. Thus, we focus our inquiry there. We conclude without doubt 

that the respondents’ claims can receive meaningful judicial review under § 78y; 

thus, this first factor strongly favors the procedure the statute provides. We then 

briefly consider the remaining two factors: whether the claims are “outside the 

agency’s expertise” and “wholly collateral to a statute’s review provisions.”

Thunder Basin, 510 U.S. at 212 (internal quotation marks omitted). Although 

these two factors are less conclusive, neither of them convinces us that Congress 

intended to exempt from the statutory review scheme the type of claims 

respondents raise.

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1. Availability of Meaningful Judicial Review

The respondents argue that § 78y fails to offer meaningful judicial review of 

their claims. Their primary contention is that § 78y only comes into play after the 

allegedly unlawful administrative process has run its course, at which time they

will have suffered the very injury they seek to avoid, and no amount of 

postdeprivation relief can remedy it. Obviously, a court cannot enjoin a process 

that has already been completed. Thus, the argument goes, because § 78y cannot 

cure the injury they will suffer—enduring an unconstitutional administrative 

process—the respondents are entitled to bring their claims in the district court. 

The respondents’ argument fails at the outset. Enduring an unwanted 

administrative process, even at great cost, does not amount to an irreparable injury 

on its own. See FTC v. Standard Oil Co. of Cal., 449 U.S. 232, 244 (1980) 

(holding that the substantial burden of defending oneself in an unlawful 

administrative proceeding does not constitute irreparable injury); see also Bebo, 

799 F.3d at 775 (“Every person hoping to enjoin an ongoing administrative 

proceeding could make this argument, yet courts consistently require plaintiffs to 

use the administrative review schemes established by Congress.”). 

The respondents do not contest this point. They instead assert that the 

administrative process here is not just unlawful—as the petitioner in Standard Oil 

had contended—but unconstitutional. We fail to see what difference that makes 

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here. Whether an injury has constitutional dimensions is not the linchpin in 

determining its capacity for meaningful judicial review. See Thunder Basin, 510 

U.S. at 213-215. In Thunder Basin, the Supreme Court held that the petitioner 

could obtain meaningful judicial review through the administrative process, even 

though the petitioner challenged as unconstitutional that very process itself. Id. at 

215. At issue was a provision of the Mine Act granting “‘[a] representative of the 

[mine] operator and a representative authorized by his miners . . . an opportunity to 

accompany the Secretary [of Labor] . . . during the physical inspection of any coal 

or other mine.’” Id. at 203 (quoting 30 U.S.C. § 813(f)). The representatives were 

also entitled to “certain health and safety information” and could “promote health 

and safety enforcement.” Id. A Mine Act regulation then authorized the miners to 

designate “‘[a]ny person or organization’” to serve as their representative to 

participate in the “walk-around” physical inspection when it occurs. Id. (quoting

30 C.F.R. § 40.1(b)(1)). A related regulation required that the mine post the 

names, addresses, and telephone numbers of the designees. Id. at 203-204 (citing 

30 C.F.R. § 40.4).

The miners at Thunder Basin designated employees of their union to 

represent them; Thunder Basin believed this designation violated collectivebargaining principles and its right to exclude union organizers from the property. 

Id. at 204. Thunder Basin thus objected to posting the names of the designees. Id.

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at 204-05. Thunder Basin apparently could have complied with the posting 

regulation and then sought review of the regulation. See id. at 221 (Scalia, J., 

concurring in part and concurring in the judgment). Or it could have refused to 

comply, begun to incur daily penalties, and meanwhile challenged the regulation 

through the statutory review process. Id. at 217-18 (majority opinion). Instead, 

Thunder Basin filed a lawsuit in federal district court raising its collectivebargaining arguments and adding a claim that requiring it to challenge the 

regulation through the statutory review process would violate due process. Id. at 

205. 

The Supreme Court held that even if the claims could not be addressed by 

the agency, the “petitioner’s statutory and constitutional claims . . . [could] be 

meaningfully addressed in the Court of Appeals” under 30 U.S.C. § 816(a). Id. at 

215. The Court rejected the argument that due process required initial review in 

the district court because “neither compliance with, nor continued violation of, the 

statute [would] subject [Thunder Basin] to a serious prehearing deprivation.” Id. at 

216. In particular, the Court determined that the alleged harm was “entirely 

hypothetical,” in part because the designees would not receive advance notice of 

the physical inspection, and thus the nonemployee union representatives—

individuals who were unlikely to be on site when the unannounced inspection 

occurred—were unlikely to be present to exercise walk-around rights. Id. at 217. 

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And to the extent the petitioner would suffer any prehearing deprivation, the 

petitioner failed to “ma[ke] a colorable showing that full postdeprivation relief 

could not be obtained.” See id. at 213. 

Likewise, the respondents here have failed to show they will suffer any 

serious deprivation that the court of appeals cannot remedy under § 78y. For one 

thing, the Commission might decide that the respondents violated no securities 

laws and thus grant the SEC no relief. But even if the Commission imposes 

sanctions in its final order, the respondents will have two opportunities to obtain a 

stay of the Commission’s final order pending judicial review, once before the 

Commission, 17 C.F.R. § 201.401, and a second time before the court of appeals, 

15 U.S.C. § 78y(c)(2). It is therefore entirely possible the respondents will suffer 

no deprivation before receiving judicial review. Like the petitioner in Thunder 

Basin, the respondents’ alleged pre-review injury is speculative at best. Moreover,

even if the respondents are unable to obtain a stay pending judicial review, they 

have made no showing that full relief cannot be obtained after judicial review. To 

the contrary, § 78y grants the court of appeals the power to vacate a Commission 

order in whole, relieving the respondents of any liability. 15 U.S.C. § 78y(a)(3). 

This case simply does not present a situation where the respondents are likely to 

suffer irreparable injury while awaiting judicial review. See Thunder Basin, 510 

U.S. at 218; Tilton, 2016 WL 3084795, at *6 (“Subsequent judicial review cannot

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26

restore [financial and emotional resources of litigation], but it can vacate the

resulting judgment and remand for a new proceeding. That post-proceeding relief,

although imperfect, suffices to vindicate the litigant’s constitutional claim.”).

The respondents’ reliance on Mathews v. Eldridge, 424 U.S. 319 (1976), and 

its progeny is misplaced. In Eldridge, the Supreme Court held that a recipient of 

Social Security disability benefits was permitted to raise in federal district court a 

due process challenge to the administrative exhaustion requirements under 42 

U.S.C. § 405(g)—providing judicial review for adverse social security benefits

determinations—in part because the plaintiff otherwise would suffer irreparable 

injury. Id. at 331-32. The Court reached its conclusion in Eldridge based not on 

the constitutional nature of the plaintiff’s claims but instead on his “physical 

condition and dependency upon the disability benefits.” Id. at 331. The Court 

observed that an “erroneous termination would damage [the plaintiff] in a way not 

recompensable through retroactive payments.” Id.; accord Bowen v. City of N.Y., 

476 U.S. 467, 483-84 (1986) (crediting the district court’s finding that disabled 

claimants, like the plaintiff in Eldridge, would suffer irreparable injury not only 

because they were denied the benefits they sought, but also because they would 

experience the “ordeal of having to go through the administrative appeal process[,]

[which] may trigger a severe medical setback,” and thus “[i]nterim benefits 

[would] not adequately protect [the] plaintiffs from this harm” (internal quotation 

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27

marks omitted)); Kreschollek v. S. Stevedoring Co., 78 F.3d 868, 873-75 (3d Cir. 

1996) (concluding that despite Congress’s fairly discernible intent to preclude 

district court jurisdiction over ordinary challenges to a worker’s compensation 

decision, the administrative process was insufficient to provide full relief to a 

person whose benefits had been terminated). The respondents have made no 

showing that they will suffer a similar irreparable injury here.

Contrary to their assertions, the respondents are not in the type of precarious 

position the Supreme Court found unacceptable in Free Enterprise Fund. 561 U.S. 

at 489-90. There, the petitioners sought to bring a constitutional challenge to the 

existence of the PCAOB, which, among other tasks, “promulgates auditing and 

ethics standards, performs routine inspections of all accounting firms, demands 

documents and testimony, and initiates formal investigations and disciplinary 

proceedings.” Id. at 485. The government argued that rather than bring a

challenge in federal district court, the petitioners should simply ignore a request by 

the PCAOB, voluntarily “incur a sanction (such as a sizeable fine),” and then 

challenge that sanction in the administrative forum. Id. at 490. The Court held 

that this process did not offer a “meaningful avenue of relief.” Id. at 490-91

(internal quotation marks omitted). Plaintiffs should not be required “to bet the 

farm by taking the violative action before testing the validity of the law.” Id. at 

490 (alteration adopted and internal quotation marks omitted). 

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Unlike the petitioners in Free Enterprise Fund, however, the respondents 

here need not bet the farm to test the constitutionality of the ALJs’ appointment 

process. On the contrary, the respondents have already taken the actions that 

allegedly violated securities laws. See Jarkesy, 803 F.3d at 20 (“Jarkesy is already 

properly before the Commission by virtue of his alleged violations of those laws. 

Indeed, the existence of the enforcement proceedings gave rise to Jarkesy’s 

challenges.”); Bebo, 799 F.3d at 774 (observing that the “key factor in Free 

Enterprise Fund that rendered § 78y inadequate is missing” where the plaintiff 

does not “need to risk incurring a sanction voluntarily just to bring her 

constitutional challenges before a court of competent jurisdiction”); McNary, 498 

U.S. at 496-97 (holding that because most undocumented aliens would need to 

“voluntarily surrender themselves for deportation” in order to ensure judicial 

review through the statutory review process, their claims escaped meaningful 

judicial review). In other words, to challenge the constitutional adequacy of the 

appointments of the SEC ALJs before the Commission, as opposed to the district 

court, the respondents must take no additional risks.

We are also unmoved by the Gray respondents’ contention that the timing of 

their complaint in federal court—before the Commission initiated an 

administrative enforcement proceeding—grants them license to bypass the review 

procedures set out in § 78y. We rejected a similar argument in Doe v. FAA. 432 

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F.3d 1259. There, aircraft mechanics received certification from a school that, 

according to the Federal Aviation Administration (“FAA”), had fraudulently 

examined and certified some of its applicants. Id. at 1260. Because the FAA 

could not determine which mechanics had received fraudulent certificates, the 

agency decided to reexamine all mechanics who received their certificates from the 

school during the relevant time. Id. The respondents filed a federal lawsuit, 

seeking an injunction instructing the FAA how to reexamine the mechanics. Id. 

We found meritless the mechanics’ argument that the administrative review 

process was inapplicable because the plaintiffs filed their lawsuit before the FAA 

took any certification action. Id. at 1262-63. “The mechanics,” we concluded, 

“simply cannot avoid the statutorily established administrative-review process by 

rushing to the federal courthouse for an injunction preventing the very action that 

would set the administrative-review process in motion.” Id. at 1263; see also 

Thunder Basin, 510 U.S. at 208, 216 (recognizing that the “[p]etitioner’s claims 

are ‘pre-enforcement’ only because the company sued before a citation was issued”

and noting that the statutory judicial review procedure “does not distinguish 

between preenforcement and postenforcement challenges”). Similarly, here, it 

makes no difference that the Gray respondents filed their complaint in the face of 

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an impending, rather than extant, enforcement action.6

 The critical fact is that the 

Gray respondents can seek full postdeprivation relief under § 78y.

Finally, we reject the Gray respondents’ contention that their claims will 

escape meaningful judicial review because of the “paltry discovery” available to 

them in the administrative forum. Gray Respondents’ Br. at 26. On this point, 

Elgin is instructive. The petitioners in Elgin were former federal competitive 

service employees who wished to challenge in federal court the constitutionality of 

a law under which they were fired for failing to register for the Selective Service. 

Elgin, 132 S. Ct. at 2131. They asserted that the agency could not develop a

sufficient factual record because it lacked the authority to decide the legal question 

 6 Unlike the Gray respondents, we do not read the conclusions drawn in Bebo, Jarkesy, 

and Tilton as resting on the timing of the respondents’ federal lawsuit. In Bebo, the court simply 

stressed that as a “respondent in a pending enforcement proceeding, [the plaintiff] does not need 

to risk incurring a sanction voluntarily just to bring her constitutional challenges before a court 

of competent jurisdiction.” Bebo, 799 F.3d at 774. As explained above, the same is true for a 

person who faces an impending enforcement proceeding. The courts in Jarkesy and Tilton 

tangentially addressed the timing of the plaintiff’s complaint when they considered the “wholly 

collateral” factor. But in Jarkesy, the court merely theorized in dicta that “[t]he result might be 

different if a constitutional challenge were filed in court before the initiation of any 

administrative proceeding (and the plaintiff could establish standing to bring the judicial 

action).” Jarkesy, 803 F.3d at 23. Likewise, in Tilton, the court simply observed that unlike the 

Appointments Clause claim in Free Enterprise, which “was not moored to any proceeding that 

would provide for an administrative adjudication and subsequent judicial review,” the analogous 

claim in Tilton targeted an aspect of an ongoing proceeding. Tilton, 2016 WL 3084795, at *8.

We are confident that the outcome would not have been different in Jarkesy or Tilton had the 

Appointments Clause claim challenged an aspect of a specific, forthcoming proceeding. In any 

event, we disagree with Jarkesy and Tilton to the extent they suggest that a district court might 

have jurisdiction to hear a constitutional challenge simply because it was filed before an 

impending administrative enforcement action.

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and that the appellate court lacked any factfinding capabilities whatsoever. Id. at 

2138. The Supreme Court was unpersuaded. “Even without factfinding 

capabilities,” the Court reasoned, “the [appellate court] may take judicial notice of 

facts relevant to the constitutional question.” Id. Moreover, the CSRA “empowers 

the [agency] to take evidence and find facts for [appellate] review.” Id. As the 

Court explained, it made no difference if the agency lacked the authority to rule on 

the legal question because there was “nothing extraordinary in a statutory scheme 

that vests reviewable factfinding authority in a non-Article III entity that has 

jurisdiction over an action but cannot finally decide the legal question to which the 

facts pertain.” Id.

We are equally confident that the respondents here can develop a sufficient 

factual record for meaningful appellate review under § 78y of their constitutional 

claims. The administrative process includes adequate tools for the Gray 

respondents to draw out the facts necessary to mount their constitutional challenge 

relating to the ALJs’ status as inferior officers. The Gray respondents may call 

witnesses to testify, for example, and if a witness is unavailable to testify, the 

respondents may seek leave to take that witness’s deposition at the Commission’s 

discretion. See 17 C.F.R. §§ 201.233, 201.234. The respondents may also request 

that the ALJ issue subpoenas when appropriate. See id. § 201.232. These tools, 

although less robust than those provided by the Federal Rules of Civil Procedure, 

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do not leave the Gray respondents without a meaningful avenue to develop the 

record.

Moreover, to the extent the Commission fails to develop a sufficient factual 

record, the reviewing court not only may take judicial notice of facts relevant to the 

constitutional questions, see Fed. R. Evid. 201, but under § 78y(a)(5) it may also 

remand to the Commission for further factfinding. Section 78y(a)(5) provides that

if the appellate court determines, on a party’s motion, that “additional evidence is 

material and that there was reasonable ground for failure to adduce it before the 

Commission, the court may remand the case to the Commission for further 

proceedings, in whatever manner and on whatever conditions the court considers 

appropriate.” 15 U.S.C. § 78y(a)(5). The combined effect of these mechanisms 

adequately allows for the development of a sufficient factual record. In sum, we 

are without doubt that under § 78y the respondents can receive meaningful judicial 

review of their claims.

2. The “Wholly Collateral” and Agency Expertise Factors

The remaining two factors do not cut strongly either way and thus do not 

persuade us that the respondents claims fall outside the scope of § 78y’s review 

scheme. See Tilton, 2016 WL 3084795, at *4 (“[A]lthough [the wholly collateral 

and agency expertise factors] present closer questions in this case, they do not 

persuasively demonstrate that the Appointments Clause claim falls outside the 

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33

scope of the SEC’s overarching scheme.”). We first consider whether “agency 

expertise [could] be brought to bear on the . . . questions presented.” Thunder 

Basin, 510 U.S. at 215 (internal quotation marks omitted). Elgin tells us that it can 

here. See Elgin, 132 S. Ct. at 2140. In Elgin, the Supreme Court held that, if the

agency can decide the merits of an underlying substantive claim and thus “obviate 

the need to address the constitutional challenge,” its expertise sufficiently “could 

be brought to bear” on the constitutional issues. Id. (internal quotation marks 

omitted); see also Thunder Basin, 510 U.S. at 215 (holding that even if the agency 

is powerless to address the constitutional question, so long as the claims “can be 

meaningfully addressed in the Court of Appeals,” the Court will not disregard the 

fairly discernible intent of Congress). 

As in Elgin, here the Commission might decide that the SEC’s substantive 

claims are meritless and thus would have no need to reach the constitutional 

claims. See Tilton, 2016 WL 3084795, at *10 (“[T]he Commission could rule that

the appellants did not violate the Investment Advisers Act, in which case the

constitutional question would become moot.”).7

 We are thus satisfied that the 

 7 In his dissenting opinion in Tilton, Judge Droney argued that unlike the constitutional 

claim at issue in Elgin, the Appointments Clause challenge is similar to a jurisdictional one, and 

thus should precede a decision on the merits. Tilton, 2016 WL 3084795, at *15 (Droney, J., 

dissenting). In other words, he suggests that the ALJ cannot simply punt on the Article II issue 

and go straight to the merits of the alleged securities law violations. Even if this were true, we 

don’t think it matters. Perhaps the ALJ cannot obviate the need to decide the Article II question, 

but she can obviate the need for a court of appeals to decide it. Indeed, if a respondent wins on 

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Commission’s expertise could be brought to bear in this way, even if its expertise 

could offer no added benefit to the resolution of the constitutional claims 

themselves. Thus, it is of no moment that respondents’ Article II claims 

themselves are outside the agency’s expertise. See Free Enter. Fund, 561 U.S. at 

491 (holding that an Appointments Clause challenge to the PCAOB, which 

challenge was materially similar to the constitutional challenges raised here, did 

not require the type of “fact-bound inquir[y]” that called for agency expertise).

8 In 

short, the agency expertise factor gives us “no reason to conclude that Congress 

intended to exempt [the respondents’] claims from exclusive review before” the 

Commission and the appropriate court of appeals. Elgin, 132 S. Ct. at 2140.

Nor does the final factor—whether the respondents’ claims are wholly 

collateral to the statute’s review provisions—tip the scales in favor of judicial 

review outside of the procedures set forth in § 78y. As the court in Bebo 

 

the merits before the Commission, the respondent has not suffered an adverse decision entitling 

him to appellate review. See 15 U.S.C. § 78y(a)(1) (authorizing only “aggrieved” persons to

appeal an adverse order of the Commission). This point “dovetails with our analysis of the 

availability of meaningful judicial review.” Tilton, 2016 WL 3084795, at *10 (majority op.) We 

agree with the majority opinion in Tilton that “a favorable Commission order, including one on 

statutory grounds, would provide an acceptable resolution of the Appointments claim and 

obviate any need for judicial review.” Id.

8 We note that during oral argument in this case, the SEC conceded that Free Enterprise 

Fund compels the conclusion that the respondents’ Appointments Clause challenge is outside the 

Commission’s expertise.

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recognized, there are several ways to understand this factor. Bebo, 799 F.3d at 

773; see Tilton, 2016 WL 3084795, at *8. We could simply compare the merits of 

the respondents’ constitutional claims to the substance of the charges against them. 

See Eldridge, 424 U.S. at 330 (concluding that the petitioner’s assertion that the 

Due Process Clause entitled him to a hearing before the termination of his 

disability benefits was “entirely collateral to his substantive claim of entitlement”). 

This approach arguably supports the respondents’ position: even if the respondents 

were to prevail on their constitutional claims challenging the status of ALJs, they 

could still face a civil enforcement action in federal district court. See Gupta v. 

SEC, 796 F. Supp. 2d 503, 513 (S.D.N.Y. 2011) (“These allegations . . . would 

state a claim even if [the respondent] were entirely guilty of the charges made 

against him in the OIP.”). In this sense, the respondents’ claims are collateral to 

the SEC’s substantive allegations.

We could focus instead on whether the respondents’ claims are “wholly 

collateral to [the] statute’s review provisions.” Elgin, 132 S. Ct. at 2136 (emphasis 

added) (internal quotation marks omitted). The Court took this approach in Elgin, 

where federal employees did not dispute the merits of the charges against them but 

instead challenged their removal by attacking the statute under which they were 

terminated. Id. at 2139-40. The Court observed that the constitutional claims were 

“the vehicle by which they [sought] to reverse the removal decisions, to return to 

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federal employment, and to receive the compensation they would have earned but 

for the adverse employment action.” Id. Their “challenge to [a] CSRA-covered 

employment action brought by CSRA-covered employees requesting relief that the 

CSRA routinely affords,” therefore, was not wholly collateral to the CSRA review 

scheme. Id. at 2140.

Viewed through this lens, it is less clear whether the respondents’ 

constitutional claims are wholly collateral to the review procedure set forth in 

§ 78y. The respondents attack the constitutionality of the ALJs and the 

administrative process as a vehicle to challenge the SEC’s decision to bring the 

case before the Commission, suggesting that their constitutional challenges are not 

wholly collateral to the SEC’s review provisions. But the respondents’ challenge 

is not a means to avoid liability altogether; as explained above, even if they prevail 

on their constitutional claims, they could face a civil enforcement action in federal 

district court. Thus, their constitutional arguments are not a “vehicle by which 

they seek” to prevail on the merits. In any event, whether we characterize the 

respondents’ claims as wholly collateral, this factor does not convince us that 

Congress intended to grant the respondents a license to bypass § 78y in the face of 

our conclusion that the statute guarantees meaningful judicial review. See Thunder 

Basin, 510 U.S. at 215 (deciding the jurisdictional issue without concluding that 

the claims were wholly collateral). We agree with the Seventh Circuit that “it is 

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37

‘fairly discernible’ that Congress intended [the respondents] to proceed exclusively 

through the statutory review scheme established by § 78y because that scheme 

provides for meaningful judicial review in ‘an Article III court fully competent to 

adjudicate petitioners’ claims.’” Bebo, 799 F.3d at 774 (quoting Elgin, 132 S. Ct. 

at 2137)). We thus conclude that the respondents’ claims are of the type Congress 

intended § 78y to govern.

III.CONCLUSION

Congress set forth a detailed process for exclusive judicial review of final 

Commission orders in the federal courts of appeals. 15 U.S.C. § 78y. From the 

text of the statute, we fairly discern Congress’s general intent to channel all 

objections to a final Commission order—including challenges to the 

constitutionality of the SEC ALJs or the administrative process itself—into the 

administrative forum and to preclude parallel federal district court litigation. We 

find no indication that the respondents’ constitutional challenges are outside the 

type of claims that Congress intended to be reviewed within this statutory scheme. 

Accordingly, the district court erred in exercising jurisdiction. We vacate the 

district court’s preliminary injunction orders and remand with instructions to 

dismiss each case for lack of jurisdiction. 

VACATED AND REMANDED WITH INSTRUCTIONS TO DISMISS 

FOR LACK OF JURISDICTION.

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