A Whopper of an Assumption in Free Enterprise Fund v. PCAOB

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3 Responses

  1. You write:

    “Scalia thought that, notwithstanding the absence of any statute providing for good cause tenure for SEC commissioners, the Court should go along with the parties’ assumption.”

    Where exactly does Justice Scalia say that? Now immediately after Justice Breyer makes his observation, Justice Ginsburg (pg 19) does comment:

    “JUSTICE GINSBURG: I thought that both sides agreed that there is no statute, everybody agrees to that. But I thought that the government, just as your side, agreed that the President could dismiss an SEC commissioner for cause.”

    …but I found nothing that would indicate Justice Scalia was morphing into a textual squish. Now he did say (pg. 17)

    “JUSTICE SCALIA: I don’t think the government will think it has achieved a great victory if it comes out of this with the proposition that the SEC is not an independent regulatory agency. And I don’t think the government is arguing that position.”

    Too bad – because I think that would have been a winning argument with Justice Scalia. Also:

    “Unless the Court is prepared to abandon Humphrey’s Executor altogether, this part of the challenge looks like a loser at this point in time.”

    Well, we can hope:

    “GENERAL KAGAN: I — I understand the temptation to say something like, well, we don’t really much like Humphrey’s Executor, but we are stuck with it, but not an inch further.
    CHIEF JUSTICE ROBERTS: I didn’t say anything bad about Humphrey’s Executor.
    (Laughter.)
    GENERAL KAGAN: But — but —
    JUSTICE SCALIA: I did, I did.” (pg 44)

    and

    “GENERAL KAGAN: Again, the President has the same level of control over the SEC as he has with respect to anything else. That’s just Humphrey’s Executor.
    CHIEF JUSTICE ROBERTS: I’m not worried if it’s the same. I’m worried if it’s enough.” (pg 48)

  2. Tuan says:

    Maryland Conservatarian:

    I read the same remark — “I don’t think the government will think it has achieved a great victory if it comes out of this with the proposition that the SEC is not an independent regulatory agency. And I don’t think the government is arguing that position.” — to be a brush off and an adoption of the assumption that the President cannot remove SEC commissioners at will. Later in the argument Scalia again changes topic when the issue is raised by Kennedy and then Sotomayor in a way that seems like a brush off (Tr. at 52.)

    Of course, Scalia did say, in response to the Breyer suggestion and Carvin’s reply, that “I’d love to say that [i.e. that SEC commissioners are removable at will by the President]. That would be wonderful.” (Tr. at 21)

    So then why doesn’t he just say that the SEC commissioners are removable at will by the President? Statutory text doesn’t evaporate because the parties neglect it. If a majority agreed, notwithstanding a broad assumption to the contrary, it would be reaching the same bottom line as the D.C. Circuit (i.e. the PCAOB is constitutional) on the removal question, but on other grounds, viz., the PCAOB doesn’t violate the separation of powers because the President can remove the SEC commissioners and thereby control their exercise of executive power.