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2 

LUCIA v. SEC 

Syllabus 

not “Officers of the United States,” but are instead mere employees—
officials  with  lesser  responsibilities  who  are  not  subject  to  the  Ap-
pointments Clause. 

Held: The Commission’s  ALJs  are “Officers of the  United States,” sub-

ject to the Appointments Clause.  Pp. 5–13.

(a) This  Court’s  decisions  in  United  States  v.  Germaine,  99  U. S. 
508,  and  Buckley  v.  Valeo,  424  U. S.  1,  set  out  the  basic  framework 
for  distinguishing  between officers and  employees.    To  qualify  as  an
officer,  rather  than  an  employee,  an  individual  must  occupy  a  “con-
tinuing” position established by law, Germaine, 99 U. S., at 511, and 
must  “exercis[e]  significant  authority  pursuant  to  the  laws  of  the 
United States,” Buckley, 424 U. S., at 126. 

In  Freytag  v. Commissioner,  501  U. S.  868,  the  Court  applied  this
framework  to  “special  trial  judges”  (STJs)  of  the  United  States  Tax 
Court.  STJs could issue the final decision of the Tax Court in “com-
paratively  narrow  and  minor  matters.”    Id.,  at  873.  In  more  major 
matters, they could preside over the hearing but could not issue a fi-
nal decision.  Instead, they were to “prepare proposed findings and an
opinion”  for  a  regular  Tax  Court  judge  to  consider.    Ibid.   The  pro-
ceeding  challenged  in  Freytag  was  a  major  one.  The  losing  parties 
argued on appeal that the  STJ who presided over their hearing was 
not constitutionally appointed. 

This Court held that STJs are officers.  Citing Germaine, the Frey-
tag  Court  first  found  that  STJs  hold  a  continuing  office  established
by law.  See 501 U. S., at 881.  The Court then considered, as Buckley 
demands, the “significance” of the “authority” STJs wield.  501 U. S., 
at 881.  The Government had argued that STJs are employees in all
cases  in  which  they  could  not  enter  a  final  decision.    But  the  Court 
thought that the Government’s focus on finality “ignore[d] the signifi-
cance  of  the  duties  and  discretion  that  [STJs]  possess.”    Ibid.    De-
scribing  the  responsibilities  involved  in  presiding  over  adversarial
hearings,  the  Court  said:  STJs  “take  testimony,  conduct  trials,  rule 
on the admissibility of evidence, and have the power to enforce com-
pliance  with  discovery  orders.”    Id.,  at  881–882.    And  the  Court  ob-
served  that  “[i]n  the  course  of  carrying  out  these  important  func-
tions,” STJs “exercise significant discretion.”  Id., at 882. 

Freytag’s analysis decides  this case.  The Commission’s ALJs, like 
the  Tax  Court’s  STJs,  hold  a  continuing  office  established  by  law.
SEC ALJs “receive[ ] a career appointment,” 5 CFR §930.204(a), to a
position  created  by  statute,  see  5  U. S. C.  §§556–557,  5372,  3105.
And they exercise the same “significant discretion” when carrying out
the  same  “important  functions”  as  STJs  do.    Freytag,  501  U. S.,  at 
882.  Both sets of officials have all the authority needed to ensure fair
and orderly adversarial hearings—indeed, nearly all the tools of fed-