Supreme Court case could sharply curtail powers of administrative agencies

November 30, 2023

This week saw the Supreme Court hear arguments over whether the Securities and Exchange Commission (SEC) can conduct in-house adjudications without juries.

As the Washington Examiner noted, that question has far-reaching implications and could shred the power of administrative agencies.

Man says his constitutional right to a jury was violated

The case was brought by George Jarkesy, a hedge fund manager and conservative radio host who was fined and barred from working in finance after the SEC determined that he had engaged in securities fraud.

Jarkesy maintained that the 7th Amendment granted him a right to have the matter heard by a jury rather than commission-appointed administrative law judges.

While the U.S. 5th Circuit Court of Appeals agreed with Jarkesy's position in a ruling last year, the Biden administration maintains that "civil penalties" can be constitutionally adjudicated through in-house proceedings.

Yet despite the practice having been in effect for over a century, the Examiner noted that some members of America's highest judicial body voiced skepticism about it.

Justice Gorsuch: Jury trials are "an ancient right"

Chief Justice John Roberts observed the "curious" way in which federal agencies exercise more power over individuals than they did in the past.

"The government is much more likely to affect you or proceed against you in one of its own agencies than it is in court," the George W. Bush appointee remarked.

"It does seem to me to be curious that, and unlike most constitutional rights, that you have that right [to a jury trial] until the government decides it doesn’t want you to have it," he continued, adding, "That doesn’t seem to me the way the Constitution traditionally works."

Justice Neil Gorsuch was nominated by former President Donald Trump and he spoke from a similar perspective, remarking that this isn't "your grandfather's SEC."

"A right to trial by jury … is a check on all branches of government," Gorsuch pointed out before stressing it is also "an ancient right."

Other issues in the case have received little attention

Peggy Little serves as an attorney at the conservative New Civil Liberties Alliance, and she was quoted as saying that the justices concentrated "almost exclusively on the jury trial question."

"There's a decent chance the 5th Circuit could be narrowly affirmed on jury trial rights where the claim maps the elements of common law actions and seeks civil penalties," she predicted.

Little observed that "there was no argument at all" on other issues brought up in the case, thus making it "impossible to speculate on whether the court plans to reach those, or if so, what the decision might be."

" A free people [claim] their rights, as derived from the laws of nature."
Thomas Jefferson
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