The legal world is buzzing over a 5th Circuit Court of Appeals decision that some experts are predicting could dismantle much of the system used to adjudicate cases involving everything from how the federal government goes after Wall Street crooks, to decisions about who gets Social Security benefits:
The United States Court of Appeals for the Fifth Circuit issued yet another astonishing decision on Wednesday. Jarkesy v. SEC seeks to dismantle much of the system the federal government uses to enforce longstanding laws and to determine who is eligible for federal benefits. And it does so in defiance of numerous Supreme Court decisions that should bind lower courts.
The holding of Jarkesy is broad. It could destroy the federal government’s power to enforce key laws preventing companies from deceiving investors, and it likely goes much further than that. Among other things, the decision could blow up the process that the Social Security Administration uses to determine who is entitled to benefits — although someone would have to file a new lawsuit before that could happen.
I’m not a lawyer, but I do understand that much American federal law is decided two ways: the first is statutory laws passed by Congress and how they are then interpreted by federal court judges. But there is an entire world of administrative laws and regulations, issued by federal agencies and often interpreted by administrative law judges. These decisions have just as much the force of law as decisions handed down by, say, district court judges.
The administrative law systems run parallel to the statutory law systems, and they have long been understood to be an important cog in the federal legal machinery which, among, other things, keeps the “regular” (aka Article III) courts from being clogged with administrative law questions so that those regular courts can concentrate on statutory law questions such as criminal cases.
The 5th Circuit court decision in Jarkesy would hobble the ability of administrative law judges to decide important cases that would otherwise not have to go to the time and expense of jury trials.
Conservatives have long hated the administrative legal system because so many decisions coming out of administrative law — including the EPA’s ability to hold polluters to account — and they have dreamed of ways of getting rid of administrative law altogether. In the Jarkesy decision they have their opening. No surprise that two of the judges in the majority are part of this crazy world of legal thought:
The two judges in the majority, Jennifer Walker Elrod and Andy Oldham, are both known for interpreting the law in creative and unexpected ways to achieve results that align with the Republican Party’s policy preferences. Elrod is probably best known for her role in a failed effort to shut down the Affordable Care Act; Oldham was recently in the news for his vote to strip companies like Twitter and YouTube of their First Amendment rights, and potentially endanger the entire social media industry in the process.
Their opinion in Jarkesy is primarily an attack on administrative law judges (ALJs). About 30 different federal agencies employ such officials to resolve disputes ranging from whether an investment fund defrauded its investors to whether an impoverished American is entitled to federal benefits.
In total, the federal government employs nearly 2,000 ALJs, more than twice the number of so-called Article III judges (federal judges who are appointed by the president and who serve for life). If these ALJs are declared unconstitutional — and Elrod’s majority opinion in Jarkesy suggests that most, if not all, of them should be — the federal government could lose close to two-thirds of its capacity to adjudicate legal disputes, hobbling enforcement while simultaneously forcing vulnerable Americans to wait years to learn if they will receive Social Security and other benefits.
Nuts. Just nuts. I have a friend who is an administrative law judge and he sees in this decision the end of his ability to do his job. There was a time when this 5th Circuit decision would have been ripe to be struck down by the Supreme Court. Not any more.
In 2018, People for the American Way wrote to the Senate Judiciary Committee expressing their opposition to Judge Oldham’s nomination to the bench, noting about Oldham’s long opposition to administrative law:
Andrew Oldham has a strong and deeply-felt ideological abhorrence of “the administrative state.” As a judge, he would be required to put that personal ideology aside and uphold the system he is so committed to destroying. It is a mystery why Oldham would want such a job. Unfortunately, nothing in his record suggests that he would be willing and able to put those views aside and operate under the constraints the position of a federal judge requires.
How correct they were.
Judge Elrod is a Harvard Law School grad, BTW.