RAYMOND J. LUCIA, ET AL., Petitioners, v. SECURITIES AND EXCHANGE COMMISSION, Respondent
Interviewer(s): Anthony M. Kennedy, Samuel A. Alito, Jr., Stephen G. Breyer, Elena Kagan, John G. Roberts, Jr., Ruth Bader Ginsburg, Neil Gorsuch, Sonia Sotomayor
Interviewee(s): Anton Metlitsky, Jeffrey B. Wall, Mark A. Perry

John G. Roberts, Jr.: We'll hear argument first this morning in Case 17-130, Lucia versus the Securities and Exchange Commission. Mr. Perry.

Mark A. Perry: Thank you, Mr. Chief Justice, and may it please the Court: SEC ALJs have been invested with the sovereign power to preside over formal adjudications.

They are officers under all of this Court's precedents, particularly Freytag and Edmond, and any textually and historically accurate construction of the Appointments Clause, which --

Ruth Bader Ginsburg: Inferior officers -- you're not contesting that -- that they are more than inferior officers?

Mark A. Perry: Justice Ginsburg, we are contesting they are inferior officers, not principal officers, correct, in part because their work is supervised by principal officers, the commissioners of the SEC, and that relationship of director and then supervision is what marks them as inferior but not as employees. And that's important to note that, in exercising those duties under the direction of the SEC, they have independence in their decisional functions, their hearing functions, and their evidentiary functions.

These are all sovereign powers that we give to judges, that governments give to judges.

The puissance de juger, as Montesquieu put it.

And that is -- those are powers that ordinary citizens, private citizens, simply do not have, absent agreement of the parties, and that governments when they delegate them must do to officers. All of those powers together makes one an officer, as this Court quite firmly and clearly recognized in Freytag.

John G. Roberts, Jr.: Well, of course, the decisions of the ALJs in every case aren't operative until the Commission issues an order of finality, right?

Mark A. Perry: Well, Your Honor, the Commission by regulation does issue a finality order.

The -- by statute, the decisions of the ALJs are deemed the decision of the Commission if not reviewed, and the review period by regulation expires after 42 days. And Congress, importantly, gave the -- the ALJs the power to make final decisions. That's in the APA Section 557(b).

And -- and the right of review in the statute, in the Exchange Act, is discretionary. So that when Congress says here is an office of the ALJ that can make a final decision on behalf of the agency, unless the agency chooses to review it, that officer must be invested with the power to enter a final decision, whether or not the -- the agency actually allows that officer to exercise it. There's two levels of authority here, and the one that Congress gave -- because tomorrow the Commission could adopt a new regulation that says: We're not going to -- we're not going to review any initial decisions in investment adviser cases under our discretion.

Every this -- such decision would become final.

And we know as a matter of fact that 90 percent of ALJ decisions do become final with no review by the Commission.

So this -- these -- these judgments --

Sonia Sotomayor: I'm sorry, that -- that figure is somewhat misleading.

Every petition for review that has been filed has been accepted for review.

The only cases -- that 90 percent encompasses default petitions. If people don't show up and nobody contests what's going on, why don't we take the SEC at its word that it's looking at the default judgment? On its face, don't see anything wrong with it.

Nobody's pointing out that there's anything wrong with it, and they're the ones who submit or adopt it as final. It doesn't become final except by the actions of the SEC officers.

Mark A. Perry: Two answers, Justice Sotomayor: First, those defaults it -- itself recognize an exercise of sovereign power.

The ALJ issues a notice, a hearing notice, that says: Appear at this time and this place or you will suffer the consequences. And if the person --

Sonia Sotomayor: Now, most of the time, I don't know of many judges -- well, judges sign order to show causes.

But it's usually prepared by a function -- functionary in the court.

Why is merely issuing the order to show cause a sovereign enough power to designate someone a -- a officer rather than an employee, when it's being done on behalf of, not in the name of, on behalf of the SEC?

Mark A. Perry: Well, first, Your Honor, the -- the hearing -- the note -- the hearing notice, which is different than an order to show cause, is issued in the name of the ALJ and goes out under the name of the ALJ, if that matters, as does the subpoena, as does all the document requirements, as does everything related to the hearing. After the order instituting proceedings is issued and it is delegated to an ALJ, the ALJ issues every order in the case. It -- it -- it oversees -- he oversees or she oversees the gathering of the evidence, the admission or exclusion of the evidence, the hearing -- the taking of the depositions, the hearing of the testimony, the convening of the hearing, compulsory settlement, if the settlement conference -- if the ALJ chooses, and the preparation of a decision.

And --

Ruth Bader Ginsburg: If -- if the provision had been that the bottom line is the ALJ recommends -- everything else is the same, they conduct the hearing, decide what evidence will be admitted, all that.

The only change would be that their bottom line is: We recommend that the Commission do so and so.

Mark A. Perry: Yes, Your Honor.

Ruth Bader Ginsburg: If -- if that were -- if that were so, then -- then they would be employees?

Mark A. Perry: No, Your Honor.

That's the FDIC scenario.

That's not permitted by statute in the SEC, but there are agencies that have that model.

557(b) of the APA provides for two modes of ALJ decision-making: Initial decisions and recommended decisions. Both have to be functioned by 3105 officers because of all the hearing-related and evidentiary-related powers in 556(c).

Those decisions, whether recommended or initial, are the agency's decision.

And the decisional process, of course, is the capstone of the adjudication, but it is not the adjudication itself.

And the -- the package of powers, the evidentiary powers, the hearing powers, the regulation of the parties' powers, which is very important in all formal proceedings, also are exercised by ALJs even in purely recommendatory cases. But in SEC cases, the only choice by statute is an initial decision, which by statute becomes the decision of the agency absent discretionary review.

Anthony M. Kennedy: If -- if we follow your theory of the case and -- and you prevail, what effect, if any, will that have on ALJs in other agencies, Social Security ALJs?

Mark A. Perry: Justice Kennedy, our submission is limited to ALJs who decide adversarial proceedings subject to Sections 556 and 557 of the APA.

There are approximately 150 ALJs who fit that definition, which is not Social Security ALJs, by the way, in the federal government, in 25 agencies. Some of those may well have already been appointed.

One of the interesting things about this case is, as we have all dug into it, it's very obscure how these ALJs are appointed, when we have a constitutional clause that is designed to promote transparency and accountability, not obscurity and opacity. But 150 is the answer to your question, and some of those may already have been properly appointed, and those are the ones who perform the judge-like characters that Congress specified in the APA.

And the Exchange Act, Section 78d-1(a), explicitly adopts Section 556 of the APA for the judges. And I think it's important in the APA, Congress said that a formal adjudication, an on-the-record adjudication under the APA, can be done by three people only: The agency, a member of the agency, or an ALJ.

And words are known by the company they keep.

These are all officers. We know the agency and its members are officers and -- and -- and they didn't say the agency -- a member of the agency or some random person you find on the street.

They said an ALJ and defined that office by the duties in 556(c).

Ruth Bader Ginsburg: Who --

Elena Kagan: Other --

Ruth Bader Ginsburg: Who is left out? You said 150 ALJs.

What -- what about Social Security ALJs?

Mark A. Perry: Our understanding, Your Honor, is Social Security ALJs do not conduct adversarial hearings.

They are not subject to 556(c) and 557 of the APA.

They are outside that under the organic statute of the Social Security Administration. These questions involve the intersection of two statutes: The APA and the organic statute of the agency.

In the SEC --

Sonia Sotomayor: I'm sorry, could you define adversarial for me?

Mark A. Perry: Yes, Your Honor.

Sonia Sotomayor: And let's go through the various agencies.

Virtually all of them -- the SEC have -- it's adversarial because it's the government versus the individual, correct?

Mark A. Perry: Yes, Your Honor.

Sonia Sotomayor: So why isn't Social Security and the Veterans Administration, the Veterans' Board, and some of the others are all investigations by the government or benefits that the government's going to give -- but they are investigating. Social Security can issue subpoenas for -- for documents.

It can call witnesses.

It could do just about everything that happens in a -- in -- in a hearing.

So what's the difference again?

Mark A. Perry: Justice Sotomayor, the way we are using the term is adversarial -- by adversarial, I mean those cases -- enforcement cases are a good example -- where a private citizen is brought against his or her will before a government body to have his or her fate decided. The Social Security Administration -- the vast majority of ALJ determinations are when a citizen voluntarily goes to the agency and seeks benefits from the government. They are applicants and --

Elena Kagan: So, Mr. Perry, if I asked you why is it important for purposes of deciding who's an officer that the person conduct an adversarial hearing, is that what you would say, that the stakes are very high, that a person has liberty on the line?

Mark A. Perry: I think the stakes, Justice Kagan, are important, but I would go to the statute actually as the definition.

I think 556(c) gives us those characteristics, those sovereign powers that can only be exercised by an officer. So that a statutory officer appointed under 3105, whose organic statute permits him or her to conduct a formal hearing, an on-the-record adjudication, which this Court has said has collateral estoppel effect, right, in -- in other proceedings, those are due process related.

Those are sovereign --

Elena Kagan: See, there's something that strikes me as -- as a little bit odd about this argument because, if you -- if you -- we just take a step back a little bit.

I mean, you have some real complaints about this process and how it happened and the bias that you think the ALJ showed. And if that's a problem, it's a hard context in which to think that the solution to the problem is greater -- the greater political accountability that comes from the Appointments Clause.

In other words, this is a situation where we have adjudications, where we typically think we want the decision-maker to be insulated from political pressures. So wouldn't putting those decision-makers even closer to the political body only exacerbate the problem that you're complaining of?

Mark A. Perry: Justice Kagan, there's a difference between decisional independence, which is guaranteed by 554(b) of the APA and the Due Process Clause, and structural independence, which the Appointments Clause is designed to ensure responsibility, accountability, transparency, and ultimately liberty, freedom.

So that we know --

Anthony M. Kennedy: So then you're saying assume, as Justice Kagan's question indicates, that it's important to the perception of justice that the adjudicator be independent.

Which way does that cut as to your argument? I think that's --

Mark A. Perry: Your Honor, as to structural independence, it's important for regulated entities, the Commission, the judges, and the courts that review their decisions to know that they are not structurally independent, that they are structurally dependent even if they have statutory decisional independence. So that we believe tying them together as the Appointments Clause requires shows the lines of authority so that reviewing courts and all those stakeholders in the process can participate. If I may reserve the remainder of my time, Your Honor.

John G. Roberts, Jr.: Thank you, counsel. General Wall.

Jeffrey B. Wall: Mr. Chief Justice, and may it please the Court: If I could just start with the government's test, the one that we hope the Court will adopt. Under Buckley and Freytag, a constitutional officer occupies a continuing position that's been vested by law with significant discretion to do one of two things: Either to bind to the government or third-parties on important matters or to undertake other important sovereign functions. Here, the Commission's ALJs have been vested by statute with both powers.

They adjudicate disputes that impose liability and sanctions on private individuals, and they can and do issue binding decisions.

There is, thus, no meaningful difference between this case and Freytag.

John G. Roberts, Jr.: How many --

Stephen G. Breyer: There are a lot of -- a lot of civil servants who have -- fit within that definition.

I -- I -- I won't give a list, but I think there are. And I think, frankly, I don't know how to decide this case for the following reason: I don't think it would make much difference but for the decision in the PCAOB case, Free Enterprise.

When I read that decision and combine it with this, then I think, if I adopt your approach, goodbye to the merit civil service at the higher levels and good-bye to independence of ALJs. But it requires both.

And you propose a test as to when we can get rid of the ALJs on, I think it's Point 17 of your reply brief, that seems to me does not guarantee them the independence that the APA hoped for. So how do I decide this case? If I'm going to decide the PCAOB application first, I would say, as I dissented, no, and at that point, it doesn't matter very much and I can go into the totally contradictory mess of what our precedent is on this, I think. But if the answer is yes, then I think I have to look for new approaches as to who is a civil servant and who is an officer of the United States, in which Congress might play a great role. Now I've been very honest in describing what I'm thinking at the moment, which doesn't help you or hurt you. (Laughter.)

Stephen G. Breyer: And I'm looking to you for advice.

Jeffrey B. Wall: I -- so two -- I -- two things, Justice Breyer.

You said in dissent in Free Enterprise Fund that all ALJs are executive officers.

Stephen G. Breyer: I know that, but I was taking the SG's test and I was going back to --

Jeffrey B. Wall: Yes.

Stephen G. Breyer: -- the -- the Freytag and -- and --

Jeffrey B. Wall: Right.

Stephen G. Breyer: -- and it was not in front of us, and I was looking for the horribles and listed about, you know, 4,000 horribles as a result of a decision that I disagreed with. (Laughter.)

Stephen G. Breyer: So I -- I don't feel that those words are absolutely written in stone.

But maybe you're right, provide that I have to know first about PCAOB before I can say whether I really want to say it does not appear to me now as it appears to have appeared to me then. (Laughter.)

Jeffrey B. Wall: Well, I -- here's why I don't think it's a horrible.

And we obviously have urged the Court to address the removal issue and what we've tried to say in our brief is we think there's a way to read the statute that avoids the constitutional concerns from the PCAOB case.

Stephen G. Breyer: Yes, the way to read the statute that you think is that you can dismiss the ALJ for failing to follow policy that may not be written into a rule that they're legally applied, required, or -- and once -- once there is a basis in the record, facts, the MS -- the -- the Systems Protection Board can't even look at it. Well, they're looking -- now that to me is not the kind of protection that the people who wrote the APA intended.

Jeffrey B. Wall: Justice Breyer --

Stephen G. Breyer: That's why I say I need to know about that before I can decide this.

Jeffrey B. Wall: With all respect, we -- I think the Court has got to distinguish what the -- what the -- the drafters of the APA were worried about, and Mr. Perry got at this a little bit, was decisional independence in Section 554 of the APA.

And we've been very clear in -- in both of our briefs that we don't think the agencies can impinge on the decisional independence of ALJs.

But Congress, of course, in 3105 said the agency can appoint the ALJ.

So we know Congress didn't mean to --

Stephen G. Breyer: All right.

So maybe that's what you mean.

Jeffrey B. Wall: -- limit it beyond the department head.

Stephen G. Breyer: Maybe that's -- but what it says is you can remove an ALJ for failure to follow agency policies -- and I take it that that isn't something embodied in a rule, it's no problem if it's embodied in a rule, but it could be beyond the rule -- and to confine the Board's role to -- the Board, that's the MSPB -- to determining whether a factful basis exists for the agency's preferred grounds.

Now try that on an Article III judge. I mean, you know, these -- these are -- these are people with an adjudicative function.

Now you may be right on that, and my only problem is I don't know how to decide this case until I decide that one.

Jeffrey B. Wall: Well, Justice Breyer, I think the way to decide this case, if you wanted to do it without getting to removal, and we've urged the Court not to do that because, unlike the appointments side, what we're dealing with is largely executive practice, the restrictions on removal are statutory, we're limited in our ability to get our own house in order there. But if you wanted to sever the two, I think what you'd say is Freytag sets up a two-part test for when you're an officer of the United States.

ALJs satisfy both.

So you don't even need to decide whether one or the other is sufficient or necessary.

Stephen G. Breyer: We can do that.

Jeffrey B. Wall: And then --

Stephen G. Breyer: But -- but, again, last point.

One thing I'm certain of, or fairly certain, moderately certain -- (Laughter.)

Stephen G. Breyer: -- that the Constitution does not inhibit the creation of a merit-based civil service and an adjudicatorily merit -- merit-based system of hearing examiners, ALJs. If I start with that premise and then don't know quite what that sentence on page 17 means and don't know how PCAOB applies, you see?

Jeffrey B. Wall: I do, Justice Breyer.

But, one, we haven't said a word about the civil service.

We're talking only about ALJs who are front-line adjudicators capable of imposing private liability -- liability and sanctions on private individuals. Two, we have been very careful not to touch pay or compensation or directing of decisions or any of the rest.

All we are talking about is saying, look, 3105 says the agency can appoint.

Sonia Sotomayor: Mr. Wall, may I --

Jeffrey B. Wall: That should be the department head under the Appointments Clause. And then --

Sonia Sotomayor: May I break --

Jeffrey B. Wall: -- the removal should follow on that.

Sonia Sotomayor: May I break down your answer, because there -- there's -- or -- or following up on what Justice Breyer said, significant authority.

I'm having a great deal of trouble understanding what significant authority means outside of the ALJ context. How will I then apply that test to executive officers who are not serving executive ALJ functions but other functions? That -- that word -- it seems to me that the test that you're -- the amici has proposed makes sense.

Do they bind the government in any situation? And, secondly, are they -- are they acting independently in -- in -- in any situation? And that test seems to be a fairly straightforward way of defining significant authority. But you're suggesting something more. You're suggesting that that test is not adequate for ALJs in some way.

Jeffrey B. Wall: No.

I -- I think the ALJs issue binding decisions.

They satisfy that test.

My problem with the test is it is --

Sonia Sotomayor: Do you --

Jeffrey B. Wall: -- it is, on the one hand, under-inclusive and it is, on the other, manipulable.

I don't think it picks up this --

Sonia Sotomayor: Everything is manipulable.

But -- but our -- our founding fathers designated some people employees and others not, serving somewhat similar functions or not, so that we can't really go by the founding fathers' practices because they were rather mixed. You know, a U.S. marshal was -- deputy wasn't an officer but a -- and customs inspectors weren't officers, but shipmasters were.

All of this seems a little bit difficult to quantify, but tell me what your -- the difference between -- not with ALJs but with other executive officers.

Jeffrey B. Wall: Right.

So we have tried to come up with a test that I think really harmonizes the Court's cases and the historical practice, and it focuses on a handful of things.

Do you have a continuing office? Everyone agrees that that -- that's present here.

Sonia Sotomayor: But every office is continuous.

Jeffrey B. Wall: Exactly.

So then you've got to look --

Sonia Sotomayor: Almost anybody who works for the government works for the government under some statute.

Jeffrey B. Wall: That's right.

And then you've got to look at what are the powers that have been vested by law in that office, and you've got to ask, okay, do those powers involve significant discretion over one of two things: The power to bind on important matters or other really important sovereign functions of the kind that historically, even absent the power to bind, were performed only by the executive branch, generally only by high-ranking members of the executive branch, and that really do require the exercise of significant discretion.

And I --

Samuel A. Alito, Jr.: But when -- when you say --

Ruth Bader Ginsburg: Can I ask you about thorough examination of this subject by the Office of Legal Counsel? What is the government's current position about the line that's drawn between employees and officers in that OLC study?

Jeffrey B. Wall: Oh, we understand our current line here to be a refinement of what OLC said in its 2007 OLC opinion.

What it said was you can be an officer because you have the power to bind on important matters, but you historically have been an officer in other ways that isn't a complete test, it's under-inclusive, and there isn't any support, I think, for the own name requirement, which is the manipulable part I was trying to get at earlier. So we understand what we've been doing here to try to boil down that very lengthy memo and the other OLC opinions and to try to come up with a test that we really do think moves the ball forward from significant governmental authority in Buckley.

Elena Kagan: Does power to bind mean power to bind that can't be reversed by somebody who's your boss?

Jeffrey B. Wall: No.

I mean, you can have discretionary review.

You had discretionary review in Edmond and -- and Weiss, and you have discretionary review here by the Commission. The point is that the ALJs issue decisions. The -- the Commission can review them if it wishes.

And it certainly, as the Chief Justice said earlier, adopted a policy that it will review virtually every one in which anyone asks.

Samuel A. Alito, Jr.: I mean, I don't -- I --

Jeffrey B. Wall: There's one instance in which it didn't, but --

Samuel A. Alito, Jr.: -- don't understand this -- how this test applies.

Is an FBI agent an officer --

Jeffrey B. Wall: I --

Samuel A. Alito, Jr.: -- or an employee?

Jeffrey B. Wall: The Court said in Steele that deputy marshals are not.

I think historically we have not understood line attorneys, line law enforcement agents to be officers of the United States because of the way in which their discretion is constrained and because the powers really are vested in their superiors.

They're vested in the marshal.

They're vested in the U.S. Attorney. They're vested in the Solicitor General.

Samuel A. Alito, Jr.: But they can all make decisions that -- that bind the United States.

Jeffrey B. Wall: I --

Samuel A. Alito, Jr.: Can they -- right?

Jeffrey B. Wall: But that's why you have to focus on the vesting, I think, Justice Alito --

Samuel A. Alito, Jr.: Well, vesting how?

Jeffrey B. Wall: -- and that's about the office.

Samuel A. Alito, Jr.: Vesting by statute, by regulation, by -- by some internal rules, by practice?

Jeffrey B. Wall: So that's a very hard question.

Here, it's statutory.

So I don't really think it's presented. The Court has a case, Mouat, from the 1880s, where it suggested it could be regulations.

The Office of Legal Counsel, and we agree, thinks the better view is that it can be more than just a statute.

If you have a statute that gives all the authority to the Attorney General and the Attorney General by regulation delegates all -- oversight over all criminal prosecutions to the deputy Attorney General, I think it would be difficult to say the DAG is not an officer --

Neil Gorsuch: Mr. Wall, let --

Jeffrey B. Wall: -- but, again, here it's all statutory.

Samuel A. Alito, Jr.: Well, our deputy clerks can grant certain extensions of time. Are they officers?

Jeffrey B. Wall: I think it's unlikely that they are, because I think they are really just exercising power on behalf of the Clerk, who is vested with that power by the -- by the Court. And, certainly, at least in the executive branch, that is typically the way it works.

The statutes vest the power in the U.S. Attorney or in the Attorney General or in the Deputy Attorney General, not in the line agents themselves.

And that's why the office and the vesting concept is very important, not just what does somebody do on a day-to-day basis. What has been established by law, in the words of the Appointments Clause? What has been vested in the office? And if the office is vested with the power to bind or some other sovereign function that historically could only be performed by the executive branch, like the adjudication of a dispute in which you impose liability on a private individual, that renders you an officer of the United States.

Neil Gorsuch: Mr. Wall --

Anthony M. Kennedy: Could you address the question that Justice Kagan and I asked Mr. Perry? Assume that the perception and fact of fairness and -- and impartiality are enhanced by independence.

How does that factor into what you're arguing, and is it a proper consideration for us in this case?

Jeffrey B. Wall: We -- I do think it's a proper consideration.

It was certainly a consideration of the drafters of the APA, who were moving from the hearing examiner model and who were concerned about allegations of bias. And we've tried to be very careful to say that what the ALJ does in the performance of his duties, the -- the decision itself, the decisional process, pay, compensation, those things are not on the table. The question is, will you be appointed by the department head or by the chief ALJ?

Elena Kagan: But all of these things -- MR. WALL.

I don't think that's a meaningful --

Elena Kagan: Mr. Wall, all of these things go to the same thing.

You know, you -- you want to keep decisional independence as something that you're not interfering with. There are different ways to interfere with decisional independence.

One is by docking somebody's pay.

One is by having a removal power that you hang over your head. And another is by being the person who gets to decide who gets the job or not. And so all of these things, in some manner, tie the adjudicator more closely to the political system.

And the APA came up with this foundational compromise which had as a very significant part of it that the hearing examiners, the adjudicators, would have some detachment, would have some insulation from the political system.

Not the way an Article III judge does, but still something. And you want to ratchet that down. And the question is, isn't that interfering with decisional independence?

Jeffrey B. Wall: I -- Justice Kagan, what I want to do is I want to take the foundational compromise that is the APA and square it with the foundational compromise that is the Appointments Clause, which says, look, if you exercise important functions on behalf of the United States, you have to be appointed by the department head, because it's not sufficient for the Commission to say: Well, look, the ALJ's decision went out the door.

We didn't review it, but he wasn't our guy.

We didn't pick him. The idea behind the Appointments Clause is you've got to have a clear line of accountability.

And this Court said in Freytag and Free Enterprise, when you diffuse the appointment power, you diffuse accountability.

Sonia Sotomayor: So, I'm sorry, doesn't the SEC have full power to overturn anything the ALJ does? This is not where, by statute or regulation, the ALJ's findings are given conclusive effect.

They're reviewed de novo.

So why isn't that the line? Whether the ALJ's word is final or not?

Jeffrey B. Wall: It is certainly the -- the fact, Justice Sotomayor, that the Commission can review everything the ALJ does and agree with it or disagree with it. But when you appear before the ALJ -- and -- and the ALJ shapes the record of that proceeding -- and that's not a recommendatory process, you can waive arguments, you are bound, and that is the record that goes up to the Commission.

And the Commission can review or not review, but the ALJ's decision at the end of the day, if not reviewed, is what binds the parties and it is what creates their obligations.

That makes them officers of the United States, as Freytag said.

John G. Roberts, Jr.: I think Justice Gorsuch has been trying to get a question in.

Neil Gorsuch: Thank you, Chief. Mr. Wall, suppose for the moment we accept your position.

What is the effect of the SEC's remedial order purporting to ratify the appointment of the -- of the ALJs? If your argument is that the ALJs need to be appointed by the SEC, does that remedial order satisfy that concern, or does it just repeat the problem?

Jeffrey B. Wall: Petitioners think it repeats the problem.

We disagree.

I think the problem that Petitioners have, they don't engage with any of the authorities.

The circuit court cases we cited in our reply, like Gordon and Legi-tech, both of the restatements on agency, the Mechem treatise, all of them say, and the courts have uniformly held, if the agent does a thing that is not authorized at the time, but the principal is capable of doing it, though here the Commission didn't, and it's capable at the time it ratifies, it can ratify. And we do think that solves the problem, which is one of the reasons -- to get back to a couple of the questions earlier -- I don't think that the kind of sky is falling arguments here are very persuasive.

Thank you.

Neil Gorsuch: Thank you.

John G. Roberts, Jr.: Thank you, counsel. Mr. Metlitsky.

Anton Metlitsky: Mr. Chief Justice, and may it please the Court: Other than a narrow historically-grounded exception concerning diplomatic offices, an officer of the United States is someone with power to bind the government or private parties in the name of his own office. In contrast, someone whose acts have no binding effect without the sanction of an officer is not himself an officer of the United States.

John G. Roberts, Jr.: If I were trying to figure out who an officer is, I think I might have started with Freytag.

And your test that you just proposed doesn't seem similar to what Freytag talked about, which was a laundry list -- not that long perhaps -- of particular -- particular authorities.

And I don't see, other than the contempt power, I suppose, what's different here than in Freytag.

Anton Metlitsky: Well, the contempt power, I think, is crucial.

So in -- in Freytag -- there are two alternative holdings in Freytag.

The second one is clearly consistent with our rule that's about the fact that special trial judges can enter final decisions. The first alternative holding is that special trial judges are officers of the United States because they can preside over trials, rule on the admissibility of evidence, take testimony, and enforce their own discovery orders through contempt. Now contempt clearly is a power that can only be exercised by an officer of the United States.

It's a coercive power that binds the parties. This Court never considered a position that only included one or all or some of the first three authorities.

But the Office of Legal Counsel, the Attorney General, and Congress have, for more than a century, all concluded that, for example, commissions that are set up to investigate but that don't have any binding authority at the end of the investigation do not set up offices of the United States --

Elena Kagan: It's hard --

Anton Metlitsky: -- even though they have the same --

Elena Kagan: It's hard to think, Mr. Metlitsky, that Freytag really thought that that was all important.

You know, they don't talk about the power of contempt until the second half of the opinion. In the first half of the opinion, they're just talking about we can respond to discovery violations without necessarily suggesting that they're talking about the contempt power. So, if you just read that first part of Freytag, you'd get no sense that it's crucial to the decision that there exists this contempt power.

Anton Metlitsky: So, as we acknowledged in our brief, you could read Freytag broadly, obviously, much more broadly than the rule we're proposing, but you don't have to read it that way.

I'm not making a claim about what was in the Court's mind.

But the Court doesn't just talk about issuing discovery orders, it's talking about enforcing discovery orders. Discovery orders are normally enforced through contempt, and special trial judges, in particular, did enforce discovery orders through contempt --

Elena Kagan: I guess what strikes me --

Anton Metlitsky: -- and that was --

Elena Kagan: -- Mr. Metlitsky, is that if you had a list and you said top 10 attributes of the judges that were involved in Freytag and the judges that are involved here, you'd pretty much say that nine of them are the same and maybe one is different. And -- but it's just so hard to get around this -- the commonalities of these judges and the judges in Freytag.

Anton Metlitsky: It's true that ALJs and the judges in Freytag share a lot of the same functions.

But what the judges in Freytag had that the judges here do not have is the thing that's always been understood to be crucial for officer status, which is the power to bind. As I said, these commissions that have been around, investigatory commissions that have been around for more than a century, all have -- this is the Warren Commission, for example, but they're mostly similar.

The Warren Commission had the power to issue subpoenas requiring the attendance and testimony of witnesses and the production of any evidence that relates to any matter under investigation.

They had the power to administer oaths and affirmations.

They had the power to examine witnesses.

They had the power to receive evidence.

John G. Roberts, Jr.: Does that make --

Anton Metlitsky: And the --

John G. Roberts, Jr.: Does that make Chief Justice Warren an executive officer in that situation?

Anton Metlitsky: No.

No.

The Warren Commission did not create an office, and it couldn't have created an office because the Commission included four congressmen, which would have been barred by the incompatibility clause, if it did create an office. The reason it didn't is because all of those powers are understood to be non-binding powers but powers internal to a hearing that allow the person that's presiding over the hearing to figure out what happened --

Elena Kagan: But why isn't it --

Anton Metlitsky: -- and what's important for officer --

Elena Kagan: -- different for that exact reason, that these are essentially investigatory bodies who are supposed to report the findings of an investigation to somebody else who's actually supposed to do something with them. But the adjudicators here are not investigators.

They are deciders.

That seems a big difference and, again --

Anton Metlitsky: Well, so --

Elena Kagan: -- seems to separate the Warren Commission type bodies from both the judges here and the judges in Freytag.

Anton Metlitsky: I -- I completely agree with that, but that would exclude, I think, the second -- the second part of the government's test, which is somebody can be an officer even if they don't have the power to bind. So the question in this case, I think, really is whether ALJs have the power to bind and whether that power is vested in their office.

That's the -- that's the, sort of, import --

Stephen G. Breyer: The problem I have --

Anton Metlitsky: -- of the -- in your own name.

Stephen G. Breyer: The problem I have with this, the whole thing, is I have no idea of what the nature of jobs are throughout the civil service, I mean, in terms of importance. There are probably people in the civil service who can order inspections of nuclear power plants.

There are probably people at OSHA who can order that the company be open at 14 -- at -- at 2:00 in the afternoon so we can come in and see if there's a dangerous situation. There are probably people in the EPA who can go out and say your, whatever it is, violates this or that.

And in certain respects, they have to have the door open. They have to do this or that.

But there might not be. But I don't -- I don't know that anyone in this case has methodically gone through civil service positions to tell me whether or not, if we decide one way or the other and on the theory, we are driving wedges of dependence into what was to be since Chester Alan Arthur a merit-based civil service.

Anton Metlitsky: I -- I --

Stephen G. Breyer: That's my concern, and I do not know what to do next.

Anton Metlitsky: I -- I completely agree with you, Justice Breyer, that that is a concern, which is why our test doesn't turn on importance. I think theirs does.

And then you're going to have lots of problems like you just identified.

Our test doesn't turn on importance -- importance at all.

It turns on a legal authority to either bind the government, make the government do particular things, or bind private parties.

And --

Samuel A. Alito, Jr.: But I -- I think -- it seems to me your test, maybe I don't understand it, but it -- it seems to me potentially very broad and also quite vague. Now, the power to bind, an enormous number of executive branch officials have the power to bind the government in one way or another.

Would you disagree with that?

Anton Metlitsky: I don't disagree with the de facto power to bind, but I agree with Mr. Wall that the relevant question is whether the -- where the power has been vested, which is the import of our second precondition.

Samuel A. Alito, Jr.: Okay.

So, I mean, anybody -- any attorney who tries a case on behalf of the government has the power to bind, makes decisions during the course of the trial that are not reviewed by anybody else, I won't call this witness, I won't ask this question. Okay.

So the power to -- the -- the -- the power to bind is enormous. Vested by what -- and you say it has to be in the name of that -- of the office. How do we find out whether it's in the name of the office?

Anton Metlitsky: Well, it's whether the person -- so take your example, an AUSA at a trial makes a binding concession or an Assistant to the Solicitor General makes a binding concession in this Court. The reason that person doesn't have to be appointed by the president with the advice and consent of the Senate is because he is exercising the authority of the Office of the Solicitor General or of the U.S. Attorney. He's acting in the name of that office.

Samuel A. Alito, Jr.: Okay.

Let's take an Assistant Attorney General.

I assume that that person is an officer of the United States, right?

Anton Metlitsky: An Assistant Attorney General, yes.

Samuel A. Alito, Jr.: Yeah, and so, if the Assistant Attorney General for the Civil Division or the Antitrust Division does something, is -- is that person exercising the authority of the Civil Division or the Antitrust Division or the authority of the Department of Justice?

Anton Metlitsky: It's the -- well, if he's exercising authority that has been delegating -- delegated to him, he's exercising the power of his own office.

The -- the reason you know, for example, that precise example, the head of the, say, Civil Division is at the top of the brief. So, when the government makes a decision, a litigation decision, which is a decision that binds the government, the person at the top of the brief is always the responsible officer.

Samuel A. Alito, Jr.: But is that what it turns on, whether -- who's listed at the top of the brief? Do -- do we look at a statute to find out whether it's vested in the office? Do we look at a regulation? Do we look at practice?

Anton Metlitsky: So it -- it doesn't turn on who's at the top of the brief, but who's at the top of the brief derives from the existing legal authority. In the Justice Department, I think it's entirely -- almost all of the authority is delegated from the Attorney General. So one statute vests all of the powers in the Justice Department to the Attorney General, another statute allows the Attorney General to delegate those powers, and so he'll delegate --

Elena Kagan: Does it strike you as a little bit odd that, essentially, that would mean that the executive branch gets to decide who's an officer and who's not an officer? Right? Take the Attorney General, most of the statutes just vest this in the Attorney General.

It's then the Attorney General that delegates his power out to other people. He can decide to, he can decide not to, he can decide where it goes.

And -- and based on those decisions, it seems, you would be saying whether a particular person is an officer or not.

Anton Metlitsky: No.

So -- so the question is whether a -- a particular delegation to a particular person is lawful. So, if Congress has created an office -- so Congress has created the Office of the Deputy Attorney General, who is appointed by the president with the advice and consent of the Senate.

That means the Attorney General is authorized to delegate to that person the authority to bind. And so that person uses that authority, for example, in the oversight of the U.S. Attorneys to direct U.S. Attorneys about how to prosecute corporations, right? That's the Thompson memo.

It's the McNulty memo. They're issued in the name of the Office of the Deputy Attorney General. If the Attorney General tried to delegate that authority to somebody that's not an officer, then that person would be -- couldn't exercise the power.

Elena Kagan: I feel -- I feel as though I'm missing something, because what you just said to me seems to make everything dependent on whether Congress has created an office.

And that can't be the only requirement, can it?

Anton Metlitsky: No.

The question is just somebody's been delegated authority.

If they're an officer -- is it -- the first question is, is it an officer function, right? If it is, then somebody that has -- only somebody that's been appointed under the Appointments Clause can exercise it.

Samuel A. Alito, Jr.: But if it's -- if it's a question of -- so the -- an Assistant Attorney General is an officer because that -- certain powers are delegated by the Attorney General?

Anton Metlitsky: Right.

Samuel A. Alito, Jr.: And the U.S. Attorney, the same thing, right?

Anton Metlitsky: I think the U.S. Attorney might have statutory authorities too, but --

Elena Kagan: But -- but that's what I was suggesting.

Samuel A. Alito, Jr.: Well --

Elena Kagan: But then everything depends on whether the Attorney General in fact makes a delegation or does not make delegation.

Anton Metlitsky: Well, that's true. That's how Congress set up the scheme.

So the -- the Attorney General gets to decide which officers exercise what authority.

Samuel A. Alito, Jr.: Well, suppose then the -- the U.S. attorney or -- or the head of one of the litigating divisions delegates certain authorities to somebody within that office. Does that make that person a -- a -- an officer?

Anton Metlitsky: No, because the --

Samuel A. Alito, Jr.: Why?

Anton Metlitsky: Because the authority rests with the -- the U.S. Attorney.

That's -- that's the relevant office.

The U.S. Attorney can delegate de facto authority, but the U.S. attorney is always going to be held accountable for every decision. So, I mean, that happens as a matter of fact in U.S. Attorneys offices.

As you said, the assistants -- Assistant United States Attorneys have a tremendous amount of discretion.

But everybody understands that when they exercise that discretion, the person that's going to be held accountable for -- for that -- for the exercise of that discretion is the U.S. Attorney, which means that it doesn't -- since the U.S. Attorney is already 100 percent accountable for the decision, it doesn't matter who appointed the assistant. You don't have to hold the U.S. Attorney or anybody else accountable for the appointment.

Sonia Sotomayor: I'm sorry, I --

John G. Roberts, Jr.: Counsel, you said on -- your -- your friend, Mr. Perry, said in his reply brief, "This Court has never held that an adjudicatory official is not an officer." Do you agree with that?

Anton Metlitsky: Yes, but an adjudicatory official is somebody that gets to decide a case, to -- to bind the parties at the end of the day.

That's why, for example, in Stern against Marshall, what this Court was concerned about, about non-Article III judges adjudicating private rights, was that they could issue final judgments of the United States.

John G. Roberts, Jr.: So -- so --

Anton Metlitsky: That's what Justice Alito's --

John G. Roberts, Jr.: I'm sorry, go ahead.

Anton Metlitsky: Justice Alito's concurrence -- your concurrence in the -- in the Amtrak case identified a -- an Appointments Clause problem with binding arbitration, binding.

John G. Roberts, Jr.: So if -- if the statute said the ALJ decision -- there you can seek review within 90 days; if after 90 days review hasn't been granted, that decision is final.

Would that be a different case for you, or would the mere possibility of discretionary review mean that the adjudicatory official did not have binding authority?

Anton Metlitsky: So I think that's a harder case than this case.

So, in this case, the -- the finality order grants affirmative sanction to the decision.

And the rule since at least 1822 --

John G. Roberts, Jr.: But your friend says that's really just a notice, that we're not going to review it.

Anton Metlitsky: Well, it's -- they say that, but what -- what the finality orders all actually say is that the orders contained in the initial decision are hereby declared effective. It's -- it's affirmative sanction granted to the decision.

And since at least the main Supreme Court's or Supreme Judicial Court's opinion in 1822, somebody who doesn't act, that can't take effect without the sanction of an officer is not an officer of the United States, which is precisely what's going on here. Now, in your hypo, there's -- there's a distinction between a decision that becomes effective by itself but that then can be reviewed.

That's like what happens in the courts of appeals and, you know, petitions for cert in this Court.

And I don't think anybody is reasonably going to say that this Court is fully responsible for every court of appeals decision. There's a different kind of order that cannot take effect at all without the act of a superior.

The act might be plenary review or it might just be denying review.

Like I said, I think that's a harder case, and I think the question would turn on whether you could reasonably hold the superior accountable for the decision by virtue of the fact that he decided not to engage in plenary review and instead denied review.

John G. Roberts, Jr.: One of the principles that caused the drafters to give the authority to appoint officers to the president was the important one of accountability.

Anton Metlitsky: Exactly.

John G. Roberts, Jr.: And in this case, if -- if the individual were an officer, he would have to be appointed by the Commission, and people would know who was responsible for whatever conduct or misconduct or decisions he would -- he would take. But in this case, you don't have that accountability.

The Commission can say: Don't blame us.

We didn't do it.

The President can say: Don't blame me.

I didn't appoint them. And, instead, it's something in the administrative bureaucracy which operates as insulation from the political accountability that the drafters of the Constitution intended.

Anton Metlitsky: Right.

So -- so I think that is the fundamental question in the case.

And I -- I respectfully disagree, Mr. Chief Justice, for two reasons. I think the Commission is going to be held 100 percent accountable for every single decision, whether it's initially made by an ALJ or not, for two reasons: First, they affirmatively sanction it.

That's why the long-standing rule that if an act requires affirmative section -- sanction, that the person that did that act is not an officer. That's why that rule exists. Second, even if you disagree that the ALJ's decisions -- if you think they're binding, the way that Congress set up the structure here makes clear that the decision is always the decision of the Commission. The Commission is allowed to delegate authority to an ALJ or to other delegees under 78d-1(a).

Congress gives the Commission authority under subsection (b) to engage in plenary review.

But Congress does not allow the Commission to escape responsibility if it doesn't engage in plenary review, because subsection (c) says that every decision is going to be deemed the decision of the Commission. So, if somebody comes to the Commission and says that decision was -- you know, was bad, was wrong, the Commission cannot say, oh, I don't know, that was my ALJ.

That would be like me saying I don't know, that was my associate, like a judge saying I don't know, that was my law clerk.

Sonia Sotomayor: So what's the line that makes somebody an agent or not? Can we speak about ALJs in this context being agents of the SEC commissioners when the SEC commissioners didn't pick them, don't supervise them, essentially don't have anything to do with their work other than reviewing it? So what defines someone acting as an agent of an office?

Anton Metlitsky: So I don't think common law agency is exactly the right frame. I think I agree, again, with Mr. Wall, the -- the initial question is where the authority, the legal authority, to act is -- is vested. I think that's -- the first example of that is the deputy marshals that were mentioned before, right? So -- so the Congress establishes in Section 27 of the first Judiciary Act the office of a marshal, who's an inferior officer, and allows the marshal to appoint deputies, who are non-officers because they're not appointed by somebody who's allowed to make an appointment under the Appointments Clause. They have all the same duties as the marshal, but they're understood to be acting in the name of the marshal's office.

That's so even though district courts, under Section 27, had authority to remove the -- the deputies, right? So -- so I don't -- again, I don't think the -- the elements of common law agency need to be satisfied.

I do think that when Congress demonstrates that it's vesting authority in a particular office, as it did here, making clear that any decision is going to be deemed the decision of the Commission, I think the agency has to have at least some ability to affect the decision.

But here, of course, the agency has plenary ability to affect the decision as to facts, as to law, as -- as to everything.

So the fact that they can't --

John G. Roberts, Jr.: So are you saying that anybody whose decisions are subject to review can never be an officer?

Anton Metlitsky: No, no, not at all. But --

John G. Roberts, Jr.: Well, I thought you were suggesting that the reason that the ALJs are not officers is that the Commission has the discretionary power to review their decisions?

Anton Metlitsky: No.

So --

John G. Roberts, Jr.: And you -- and you seem to be putting a lot of -- I'm sorry, go ahead.

Anton Metlitsky: No.

So -- so they are not officers for -- for two reasons: One is that they don't have, in our view, decisions to make binding -- the authority to make binding decisions in the first place. And, second, because all the authority -- if they had authority to make binding decisions, that authority would be to make binding decisions that are actually decisions of the Commission --

Elena Kagan: And -- and --

Anton Metlitsky: -- not the decisions of the --

Elena Kagan: -- they don't have authority to make binding decisions because?

Anton Metlitsky: Because the -- the question -- so the statute applicable here, 78d-1, is an authorization of delegation. Right? The Commission is allowed to delegate authority to the ALJ. And so the question is, what authority did the Commission delegate to the ALJ? So first you can look at 17 CFR 201.111(i), which is on 16A of our green brief.

It authorizes ALJs to prepare an initial decision as provided in Section 201.360. So, if you go to 201.360(d), which is on 23A of the green brief, (d)(1) says that the Commission can engage in plenary review either on petition or, you know, on its own initiative; (d)(2) says that an order won't become final and effective without the issuance of a finality order. So, in other words, the --

Elena Kagan: So everything in the end depends on that?

Anton Metlitsky: No.

We -- so there are two preconditions for our test.

The first one depends on that.

The second one is the -- the -- whatever the ALJ --

Elena Kagan: Right.

But as to the first one --

Anton Metlitsky: Yes.

Elena Kagan: -- as to whether they have binding authority, it all comes down to this finality order?

Anton Metlitsky: Yes.

They don't have bind -- well, that's why they don't have binding authority, because the Commission has to --

Elena Kagan: Even --

John G. Roberts, Jr.: And it seems to me, I mean, we've heard about the independence of the adjudicator.

You seem to be suggesting that he is not an officer because he doesn't have the kind of independence that it's been suggested the APA and other things were designed to promote.

Anton Metlitsky: Well, no.

So the APA was -- was a compromise.

It granted ALJs structural independence: Tenure, salary, various ex parte rules and the like, but the one thing they explicitly did not grant ALJs was decision-making authority, policy-making authority; in other words, the authority to make binding decisions. That power always rests with the agency, which is the crucial question for whether somebody is an officer of the United States.

Stephen G. Breyer: If you -- did you come across in your research anywhere anything like this that -- because it does say an officer of the United States whose appointment shall be established by law.

That suggests Congress has a role. And so, in the set of statutes that doesn't say, there would be some criteria where Congress, if they establish it like this, say major policy-making authority, independently, and maybe some instances adjudicatory authority to make binding decisions, they're officers. In other cases, clearly not.

They're agents.

But there'd be a middle range where you'd look to the statute itself and you'd see if in that statute Congress has written significant parts that are not consistent with appointment by the department itself and/or not subject to two levels of for cause removal.

Anton Metlitsky: Well, so I --

Stephen G. Breyer: Did anything -- have you come across anything like that?

Anton Metlitsky: There -- there are lots of statutes dealing with how people are appointed in various agencies.

Sometimes it's very clear that Congress did not intend people to be officers of the United States.

One example is that there's a statute in the organic -- the organic statute of the Federal Aviation Administration grants the administrator authority to -- to appoint everyone in the agency, essentially other than the deputy, and the administrator is not the head of a department.

The head of the department is the Secretary of Transportation. So anybody the administrator is appointing under that statute is not going to be an officer. That doesn't apply here because 3105 actually does grant agencies the authority to appoint ALJs.

You know that Congress doesn't think they're officers because, in 1966, Congress, when it codified Title V, wrote a definition of officer, wrote a definition of employee.

Hearing examiners before that date were referred to as officers.

And that 1966 statute switched all those references to make them refer to employees.

John G. Roberts, Jr.: You said --

Elena Kagan: Mr. Metlitsky, as -- as I listen to you, and especially as I compare your test to some of the others on offer, you know, there seems to be a good deal to be said for yours, except I don't know where it's coming from, honestly. So you spent a lot of time in your brief talking like this is a historical test, this is a traditional test.

Anton Metlitsky: Right.

Elena Kagan: And I guess it seems to me like the test actually, it's sort of the opposite, the test you would make up if you were doing everything on a blank slate.

But I don't really see what the source of this test is.

So tell me what it is.

Anton Metlitsky: So -- so the source for the first part of the test that you need to have binding authority, I really -- I think is -- has been accepted at least since 1822 when the main supreme judicial court explained that an officer of the United States is somebody who has been delegated a portion of the sovereign authority of the United States, meaning the authority to bind, and that somebody whose acts don't take effect without the sanction of an officer is not an officer. That's what that opinion held and it's been understood to be authoritative since then. That -- that's essentially the Office of Legal Counsel test from 2007. The second part of the test is really I think exactly what Mr. -- Mr. Wall said. There's always going to be a question of where the legal authority to act is, because otherwise every person with discretion like every AUSA is going to be considered an officer, even though the U.S. Attorney is going to be held 100 percent accountable for every decision in his or her office. I think the -- the first place where you can see that -- that relationship of, you know, basically agent to officer is Section 27 and 28 of the First Judiciary Act with the marshal and the deputy marshal. One of the things that under Section 28 the deputy marshal was authorized to do was, when the marshal died, to execute writs in the name of the deceased marshal until a new marshal was chosen. So the -- sort of the second part of our test, which asks whether somebody's authorized to act in the name of their own office or only in the name of somebody else's office, just reflects that principle, which I think is, as we've talked about, ubiquitous in actual government practice. It's why Assistants to the Solicitor General don't need to be appointed by the president with the advice and consent of the Senate since I don't think there's a statute that actually authorizes the Attorney General to appoint them himself. If the Court has no further questions.

John G. Roberts, Jr.: Thank you, counsel. Three minutes, Mr. Perry.

Mark A. Perry: Thank you, Mr. Chief Justice. Three brief points, if I may: First, every official who satisfied my friend Mr. Metlitsky's test would be a principal officer of the United States. If you can bind the government or private parties in your own name with no supervision, that's a principal officer.

This Court rejected that as a test for inferior officers in Edmond, which involved judges who could never make final decisions unless their superiors allowed it. And the Weiss case, which involved trial judges in the military whose opinions were never final, which my friend never mentions and never cites in his briefs, because he -- they cannot meet the finality test. In any event, SEC ALJs do meet the finality test.

78d-1 gives the Commission a discretionary right of review, which means it has the discretion not to review, which means they're statutorily authorized to enter final decisions of the Commission. The finality order, Your Honor, in a discretionary review scenario, it's like a cert denied order from this Court.

It says that the Commission is not reviewing, but the actual decision that stands in his own name, by the way, Petition Appendix 237A, is Cameron Elliot's signature on the decision he issued in his own name that to this day is on the Commission's website. Second, Justice Breyer and others have required about the expansion to the civil service.

It is a real issue.

Of course, it's a real issue.

But, here, we have adjudicators. We have, unlike the civil service, a tower of cases from this Court, Freytag, Ryder, Edmond, Weiss, all dealing with adjudicators. Ten out of 10, Justice Kagan, powers that they have map over perfectly.

And we have a direction from Congress, Justice Breyer, as to the limitation.

It is 556(c), which specifies those officials that can conduct on the record adjudications that have binding effect under the APA.

And there are three: Agencies, members, and ALJs. And while the civil service is out there, Congress has dealt specifically with ALJs.

And 3105, of course, specifically designates the office of APA ALJs and it says appoint. Finally, Justice Gorsuch, you asked about the remedy.

My client had an unconstitutional proceeding.

Mr. Wall says I ignore the authorities.

I don't. The authorities are from this Court. In Ryder, this Court said the Constitution requires a new proceeding in front of a constitutional officer, with no validity given to the prior acts. In L.A. Tucker Truck Lines, this Court said the acts of an unconstitutional officer are a nullity.

And then, in Ryder, the Court went on and said you're entitled to whatever relief may be appropriate.

And this Court -- this is an APA case.

This Court has never actually had an APA Appointments Clause violation.

Section 706 of the APA says that upon a finding of constitutional violation, the reviewing court shall set aside all actions, findings, and conclusions of the agency, which means they all have to be wiped out because there was a constitutional violation here, start from scratch, or, as we suggest, dismiss the OIP. This Court said in FTC versus Standard Oil that where there's an APA -- in the APA review, where there's a violation, you can go all the way back to the complaint, dismiss the whole thing, which we submit --

Sonia Sotomayor: Just so I understand, what would this do with already completed cases --

Mark A. Perry: Your Honor, our --

Sonia Sotomayor: -- where the period of appeal has ended both before the SEC and before the courts?

Mark A. Perry: Presumably -- may I?

John G. Roberts, Jr.: Please.

Mark A. Perry: Presumably, Your Honor, general principles of preservation waiver, forfeiture and so forth, would kick in, although, of course, in -- in Freytag and CFTC versus Schor, the Court put some gloss on that in the context of constitutional challenges to agency actions. This case, of course, is here on direct review.

It has never gone final.

And there are -- we -- we put the numbers in our brief -- there are 13 other similarly-situated cases in the entire federal system.

Sonia Sotomayor: But there are hundreds where the ALJs were ratified or appointed after decision-making or in the midst of it, et cetera.

Mark A. Perry: Appendix A to the ratification order lists about 106 cases that the agency thinks is affected.

I haven't looked at that.

Sonia Sotomayor: Well, if we're talking just about your agency.

But if we're talking about all the other agencies, we're -- we're talking in the thousands.

Mark A. Perry: I don't know, Your Honor. We know this case, however, we know the answer.

John G. Roberts, Jr.: Thank you, counsel. Mr. Metlitsky, this Court appointed you to brief and argue this case as amicus curiae in support of the judgment -- judgment below.

You have ably discharged that responsibility, for which we are grateful. Thank you. The case is submitted.