The Appointments Clause of the federal constitution (Art. II, sec. 2) requires “Officers of the United States” to be appointed by the President, a court of law, or the head of a Department. Lesser employees may be appointed by other persons or means. Under existing case law, an officer of the United States must occupy a permanent, not temporary, position and exercise significant authority pursuant to United States law. An earlier case held that Tax Court special trial judges wielded sufficient authority to be officers of the United States because they have all the power needed to conduct hearings and prepare proposed factual findings. Like them, the SEC’s administrative law judges (ALJs) take testimony, receive evidence, examine witnesses, administer oaths, rule on motions and on the admissibility of evidence and enforce compliance with discovery orders. Therefore the SEC’s ALJs are officers of the United States and must be appointed by the commission itself, not its staff. Lucia, who timely objected raising an Appointments Clause challenge, is entitled to a new hearing before a properly appointed ALJ, and not the same one who initially heard his case.
United States Supreme Court (Kagan, J.; Thomas & Gorsuch, JJ., concurring; Breyer, Ginsburg, & Sotomayor, JJ., concurring in the judgment & dissenting in part; Sotomayor & Ginsburg, JJ., dissenting); June 21, 2018; 2018 U.S. LEXIS 3836