Month: December 2024

Will SCOTUS revive the nondelegation doctrine? Cert. granted in Consumers’ Research v. FCC

When SCOTUS granted cert. in SEC v. Jarkesy, the case challenging the constitutionality of the SEC’s administrative enforcement proceedings, one of the questions presented was whether the statute granting authority to the SEC to elect to use ALJs violated the nondelegation doctrine. Jarkesy had contended that, in adopting the provision in Dodd-Frank permitting the use of ALJs but providing no guidance on the issue, “Congress has delegated to the SEC what would be legislative power absent a guiding intelligible principle” in violation of that doctrine. Had SCOTUS gone that route, commentators suggested, the case had the potential to be enormously significant in limiting the power of the SEC and other federal agencies beyond the question of ALJs. A column in the NYT discussing  Jarkesy explained that, if “embraced in its entirety, the nondelegation doctrine could spell the end of agency power as we know it, turning the clock back to before the New Deal.” And in Bloomberg, Matt Levine wrote that, while the ”nondelegation doctrine has not had a lot of wins in the Supreme Court in the last 90 years….it’s back now: There is revived interest in it at the Supreme Court.”  Had Jarkesy won the nondelegation argument, that could have meant “that all of the SEC’s rulemaking (and every other regulatory agency’s rulemaking) is suspect, that every policy decision that the SEC makes is unconstitutional. Much of US securities law would need to be thrown out, or perhaps rewritten by Congress if they ever got around to it. Stuff like the SEC’s climate rules would be dead forever.”  In his view, “the Supreme Court does have several justices who would love to revive the nondelegation doctrine in a way that really would undermine most of securities regulation.”  That didn’t happen in Jarkesy; SCOTUS studiously avoided addressing the issue, its looming presence in the lower court decision notwithstanding. But the nondelegation doctrine has again reared its head, this time in Consumers’ Research v. FCC out of the Fifth Circuit.  In late November, SCOTUS granted cert. in that case (and consolidated it with another case, SHLB Coalition v. Consumers’ Research, that presented similar questions). All three of the questions presented in the cert. petition relate to the nondelegation doctrine (although another was added by SCOTUS itself). With this case now on the docket, will SCOTUS continue its shellacking of the administrative state? (See this PubCo post, this PubCo post, this PubCo post, this PubCo post and this PubCo post.) And add another big wrinkle: how will the new Administration approach this case and this question? While, historically, according to Bloomberg, the “solicitor general typically defends federal statutes and programs regardless of party affiliation,” there is no assurance that the new Administration will follow historical practice. Indeed, according to this article in Law.com, with a new administration, “[f]lipping positions at the Supreme Court has become a common trend of incoming U.S. solicitors general, even if it tends to irk the justices themselves.”