SEC v. Cochran (21-1239)

argument 21-1239

SEC v. Cochran

Supreme Court of the United States 1h 9m 7 speakers 8 chapters transcribed 6 days ago official recording ↗

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What is the central jurisdictional question the Court is being asked to resolve?

John G. Roberts 0:00

We'll hear argument

Mr. Garr 0:01

next in case twenty one twelve thirty nine, uh SEC versus Cochrane. Mr. Garr? Thank you, Mr. Chief Justice, and may it please the court. The question in this companion case is whether the SEC Act strips district courts of jurisdiction that they have historically possessed to adjudicate and enjoin structural constitutional violations, here in the form of an agency decision maker that is unconstitutionally insulated from removal by the President. But unlike the Axon case, in which th the plaintiff is a corporation. This case illustrates the crucial importance of this district court jurisdiction for everyday Americans who find themselves trapped before an unconstitutional agency decision maker. The SEC acts as prosecutor, judge and in effect executioner in its own proceedings.

Mr. Garr 0:52

All of which give it an extraordinary home court advantage. And yet SEC ALJs suffer from a blatant constitutional defect. dual layered protection from remov removal that taints their very existence and vitiates their authority to act at all. That structural defect inflicts a here and now injury that exists wholly apart from any adverse outcome in that proceeding. Going back to Marbury versus Madison, this court has recognized that district courts possess jurisdiction under twenty eight USC thirteen thirty one. to enjoin government entities from acting unconstitutionally. Nothing in section seventy eight Y of the SEC Act. nor anything else pointed to by the government. An act in which Congress merely granted jurisdiction to the Courts of Appeals to hear challenges from final orders of the Commissions takes takes that jurisdiction away as to the structural constitutional claims at issue here.

Mr. Garr 1:52

That conclusion is compelled first and foremost by the text of the relevant ta statutory provisions. It is compelled by this court's decision and free enterprise fund, which involved the same statute. in the same kind of constitutional claim. And is consistent with this court's own Thunder Basin factors. I welcome the Court's questions.

Clarence Thomas 2:13

Uh Mr. Garr, is there any m meaningful difference between the facts of this case and the arguments uh and the previous case?

Mr. Garr 2:23

In essence, no, Your Honor, in in this case is is different in in a few respects. Number one, Free Enterprise Fund, which we believe strongly supports Mr. Clement's position applies even more forcefully to this case, in which involves the same statute and the exact same claim here. I think that the statute in this case, although similar in many respects, is different in at least one respect that makes this case easier, and that's the saving clause in the SEC Act, in which Congress made clear that it was not displacing traditional rights or remedies, and we think that one of the remedies that It It uh protected was a traditional a remedy of going to a federal court to get an injunction against agency action.

Mr. Garr 3:05

But but The short answer to to your question is we believe that jurisdiction exists in both cases for largely the same reasons.

Clarence Thomas 3:12

And one final uh question, just a short one. Um there's a lot of talk about uh these cases, uh orders actually being entered in these cases. And then they're subject to review. How often does that happen?

Mr. Garr 3:28

Very infrequently in the in the relative sense, Your Honor, the vast majority of these cases settle more than ninety percent because the individuals just frankly can't endure the years of proceedings that it takes uh to get to an Article three.

Clarence Thomas 3:43

How many years has this been going on?

Mr. Garr 3:46

Well, it's it's been going on i really in our situation since Dodd Frank in which many of these claims have been channeled to these in house agency proceedings. Now the SEC doesn't have to act this th this way. It can go to federal district court in which citizens enjoy greater rights and protections. It can go before its own commission. Uh but instead it elects typically to go before its own in-house ALJs which suffer from this blatant constitutional defect. And to the Chief Justice's point earlier, we think that the Jarkeese case shows exactly the flaw with the government's position that you would have to wait um some seven years in Mr.