Josh Blackman, October Term 2019 in Review: Blue June
Jonathan H. Adler, Conservative Minimalism and the Consumer Financial Protection Bureau
Lisa Schultz Bressman, What Seila Law Says about Chief Justice Roberts’s View of the Administrative State
David A. Strauss, Non-Judicial Precedent and the Removal Power
Markham S. Chenoweth & Michael P. DeGrandis, Out of the Separation-of-Powers Frying Pan and Into the Nondelegation Fire
Patricia A. McCoy, Constitutionalizing Financial Instability
John Harrison, Seila Law and the Law of Judicial Review
Jack M. Beermann, Seila Law: Is There a “There” There?
Timothy G. Duncheon & Richard L. Revesz, Seila Law as an Ex Post, Static Conception of Separation of Powers
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Seila Law and the Roberts Court
Introduction by Deborah Malamud1Kenyon College, B.A. 2017; The University of Chicago Law School, J.D. 2021. She thanks the authors for their contributions to the series.
Speaking on Chevron deference at Duke University School of Law in 1989, Justice Antonin Scalia told the audience to “lean back, clutch the sides of your chairs, and steel yourselves for a pretty dull lecture.” Perhaps he would have withheld his cynicism if he could have seen the Supreme Court’s administrative-law rulings in the past year.
One source of drama: reports of the nondelegation doctrine’s death may have been greatly exaggerated. True, the Court chose not to invoke the nondelegation doctrine to strike down the Sex Offender Registration and Notification Act in Gundy v. United States. But the Act barely survived, squeaking through thanks to an uneasy coalition of the four liberal justices and Justice Samuel Alito, who suggested he would switch his vote in a different case. Chief Justice John Roberts and Justices Neil Gorsuch and Clarence Thomas all said they wouldn’t have chickened out of invoking nondelegation for the first time since the 1930s. If Justice Brett Kavanaugh (who wasn’t on the Court when Gundy was argued) agrees with his conservative colleagues, the Court could have the five necessary votes to revitalize the nondelegation doctrine. This would pose serious challenges to environmental legislation and many other statutes we take for granted.
Then there was Kisor v. Wilkie, in which the Court again veered away from drastic measures. The majority did not overturn the Auer standard—a “contentious doctrine that directs judges to defer to agency interpretations of their own rules.” But Justice Elena Kagan’s opinion lays out rigid doctrinal limitations and a five-part test for when judges should give agencies deference. According to Jeff Wood, the former acting head of the Justice Department’s environmental division, “[f]ollowing Kisor, agency deference . . . is more the exception than the rule.” If it quacks like it’s being overturned…
And then, wanting its own turn in the new administrative-law limelight, a law firm called Seila Law LLC refused to comply with the Consumer Financial Protection Bureau’s (CFPB) civil investigative demand for responses to interrogatories and document requests. The CFPB, backed up by the Central District of California, enforced compliance. Seila Law appealed, arguing that the CFPB’s structure as an independent agency led by a single director who exercises executive power but can only be removed by the president for cause violates the Constitution’s separation of powers doctrine.
The Ninth Circuit disagreed, finding that Humphrey’s Executor v. United States and Morrison v. Olson control and point the other way. Citing Morrison, the Ninth Circuit held that these cases show that the CFPB director’s for-cause removal protection “does not ‘impede the President’s ability to perform his constitutional duty’ to ensure that the laws are faithfully executed.”
The Supreme Court found otherwise. The for-cause removal provision is severable from the Dodd-Frank Act—the CFPB is here to stay—but the director’s removal protection violated the separation of powers.2Congress can provide for-cause removal protection to a multimember commission-like heads of agencies, as long as both political parties are represented equally, there are staggered terms, and the members perform only “quasi-legislative” and “quasi-judicial functions.” It can also do so for inferior officers, like the independent counsel, who do not have administrative authority. According to the Court, the CFPB director does not fall into either of the exceptions permitting for-cause removal, and the Court declined to make further exceptions. Justice Thomas’ concurrence, which Justice Gorsuch joined, argued for limiting the already-existing exceptions to for-cause removal protection. In dissent, Justices Kagan, Ruth Bader Ginsburg, Stephen Breyer, and Sonia Sotomayor argued that “the text of the Constitution, the history of the country, the precedents of this Court, and the need for sound and adaptable governance”—as well as the importance of guarding agencies from political pressure—cut against the majority’s position.
This series focuses on Seila Law LLC v. Consumer Financial Protection Bureau. Our participants evaluate the Court’s use of history, attempt to make sense of the case’s odd and internally conflicting precedents, and predict Seila Law’s effects on financial regulators. But this series also places Seila Law in the context of the Term and the Roberts Court. The panel examines Chief Justice Roberts’ influence on the Court—is it waning or waxing?—the nature of judicial review, and much more.
Josh Blackman begins the series with a satirical review of the Term, focusing on what he dubs “Blue June,” a month in which a clearly conservative Court veered to the left. Seila Law, he notes, was a “purple blip” amidst Department of Homeland Security v. Regents of the University of California, Financial Oversight & Management Board for Puerto Rico v. Aurelius Investment, LLC, and June Medical Services v. Russo.
Next, Jerry Mashaw argues that Seila Law’s majority and dissenting opinions disagree so completely on how to read precedents like Humphrey’s and Morrison because those decisions amount to a “jurisprudential train wreck.” And in Seila Law, like those previous cases, awkward reasoning results in a petitioner winning and losing simultaneously.
Jonathan Adler places Seila Law in the context of what he characterizes as Chief Justice Roberts’ “anti-disruption” jurisprudence. The chief justice’s minimalist tendencies have become more pronounced and more practically successful over time. In Seila Law, Adler reasons, the chief justice was calling balls and strikes as usual.
According to Lisa Schultz Bressman, Seila Law distinguishes between single-headed and multimember agencies to evaluate the constitutionality of for-cause restrictions, permitting the structure of the agency to determine the extent of the president’s control over its principal officers. But crucially, Seila Law gives us a glimpse into the chief justice’s view of the administrative state, helping us understand decisions he wrote a decade ago. Roberts, per Bressman, is guided by a “concern for preventing abuse of power and protecting individual liberty in the administrative state.” Viewed in this light, Seila Law is nothing new.
David Strauss focuses on the ways in which both the majority and dissenting opinions in Seila Law invoke non-judicial precedent: “past decisions made not by courts but by other branches of government.” This raises questions about why reliance on this kind of precedent is so common in separations-of-powers cases, and, more broadly, whether this reliance is justifiable.
Then, Markham Chenoweth and Michael DeGrandis argue that, although Seila Law fixed a “glaring constitutional defect” in the CFPB’s structure, the Bureau is not off the hook quite yet. Seila Law, according to Chenoweth and DeGrandis, exacerbated a second constitutional defect in the agency’s design that was not up for debate in this case: the CFPB’s funding regime cuts Congress out of the Bureau’s appropriations process. By eliminating the CFPB director’s for-cause removal protections, Seila Law transferred Congress’ appropriations power from the CFPB’s formally independent director straight to the president.
Patricia McCoy writes that because Seila Law enshrines its ruling as constitutional command, it erodes independent agency protections in the “worst possible way.” She argues that the Court’s decision removes safeguards that would protect the Bureau and other independent financial regulators from political strong-arming that would damage the economy.
Next, John Harrison details the ways in which the justices’ approach to constitutional litigation in Seila Law departs from the standard understanding of how judicial review works. The “metaphor of judicial lawmaking” often influences judges; in Seila Law, the justices seem to treat constitutional rules as though they impose duties, rather than limit powers. This, according to Harrison, muddles the basic judicial-review doctrine set forth in Marbury.
Jack Beermann writes that, first, Seila Law creates a new constitutional prohibition by restricting Congress from creating independent agencies with significant regulatory power headed by a single director. Yet, the Seila Law Court declined to dramatically expand presidential control of independent agencies. Beermann worries that the dissent’s argument that multimember agencies may be more difficult for the president to control than single-headed ones may provide a basis for invalidating the independent-agency form altogether.
Finally, Timothy Duncheon and Richard Revesz discuss the Seila Court’s “failure to consider the realities of interbranch relations over time.” Duncheon and Revesz argue that the Court views these dynamics from an ex post, static perspective. Their Essay considers how Seila Law may affect interbranch relations in the future, providing a roadmap for a “consequentialist criticism” of the majority’s opinion.
The Essays in this series frame the newest chapter in our administrative-law moment, discussing the effect of the chief justice’s broad view of the Court as umpire on the Seila Law decision, the ways in which the justices are influenced by judicial and non-judicial precedents, and the game of constitutional whack-a-mole the decision may provoke. These pieces propose answers to several questions at the heart of our constitutional scheme: among them, how separate should powers be?
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Deborah Malamud is a J.D. Candidate in the University of Chicago Law School Class of 2021. She received her B.A. from Kenyon College in 2017. She thanks the authors for their contributions to the series.
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Featured photo credit to Geoff Livingston.