ADJUDICATIONS

Federal Communications Commission v. AT&T

Issues

Do the Communications Act of 1934 provisions that govern the Federal Communications Commission’s assessment and enforcement of monetary forfeitures violate regulated entities’ Seventh Amendment right to a jury trial or impinge on federal courts’ Article III authority?

This case asks the Supreme Court to decide whether the statutory provisions that govern the Federal Communications Commission’s (“FCC’s”) assessment and enforcement of monetary forfeitures violate regulated entities’ Seventh Amendment right to a jury trial or impinge on federal courts’ Article III authority. AT&T, which was ordered to pay a forfeiture by the FCC for violating consumer privacy rights, claims that the Seventh Amendment and Article III entitle it to a jury trial in federal court before such an order is made. The FCC argues that the current procedures—which provide AT&T with the right to challenge enforcement of a forfeiture in federal district court—preserve AT&T’s right to a jury trial in federal court. This case carries implications for the FCC’s ability to assess monetary penalties for violations of federal telecommunications law. It also has implications for other agencies that follow procedures essentially identical to those the FCC followed here.

Questions as Framed for the Court by the Parties

Whether the Communications Act of 1934 provisions that govern the Federal Communications Commission’s assessment and enforcement of monetary forfeitures are consistent with the Seventh Amendment and Article III.

The Communications Act of 1934 (“Act”) established the Federal Communications Commission (FCC) and introduced comprehensive federal regulation of the radio and telephone industries. 48 Stat.

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Securities and Exchange Commission v. Jarkesy

Issues

Does the Securities and Exchange Commission’s choice of enforcement proceedings violate the Seventh Amendment or nondelegation doctrine, and does the for-cause removal of Administrative Law Judges violate Article II of the United States Constitution?

This case asks the Supreme Court to decide whether the Securities and Exchange Commission’s (“SEC”) power to adjudicate securities fraud claims violates the Seventh Amendment or nondelegation doctrine, and if the for-cause removal protections for Administrative Law Judges violate the Take Care Clause. The SEC argues that securities fraud actions only implicate public rights that do not require juries, that its power to choose between adjudicatory and court-based enforcement was created lawfully by Congress, and that the for-cause removal protections do not unduly interfere with the President’s power. Jarkesy counters that securities fraud claims are private rights that require juries, that the SEC’s choice of where to adjudicate enforcement actions unduly delegated legislative power, and that the for-cause protections interfere with Presidents’ ability to carry out their duties. The outcome of this case has serious implications for securities regulation, the workability of administrative enforcement actions, and public faith in federal adjudicatory institutions.

Questions as Framed for the Court by the Parties

  1. Whether statutory provisions that empower the Securities and Exchange Commission to initiate and adjudicate administrative enforcement proceedings seeking civil penalties violate the Seventh Amendment.
  2. Whether statutory provisions that authorize the SEC to choose to enforce securities laws through an agency adjudication instead of filing a district court action violate the nondelegation doctrine.
  3. Whether Congress violated Article II by granting for-cause removal protection to administrative law judges in agencies whose heads enjoy for-cause removal protection.

In 1934, Congress passed the Securities and Exchange Act of 1934 (“the Act”) creating the Securities and Exchange Commission (“SEC”). 15 U.S.C. 78d(a). Its primary purpose was to protect investors and ensure a fair and efficient market. Id. The SEC is comprised of five commissioners who are appointed by the President with the advice and consent of the Senate. Id.

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