"If the individual were an officer, he would have to be appointed by the commission, and people would know who was responsible for whatever conduct or misconduct or decisions he would take," Roberts said.
The Trump administration is taking the unusual step of backing Lucia at the high court and arguing that the SEC’s appointment process for judges is unconstitutional. The administration, however, disagrees with Lucia about the practical implications of the constitutional issue, saying the commission has retroactively fixed the problem by ratifying the judges’ appointments itself.
Deputy Solicitor General Jeffrey Wall said SEC judges qualify as "officers" because they adjudicate disputes, impose sanctions on private parties and have the power to bind the federal government.
Breyer said that approach would mean "goodbye to the merit civil service at the higher levels and goodbye to the independence of ALJs."
Ratcheting Down
Wall also drew resistance from Justice Elena Kagan, who pointed to a 1946 law that insulated administrative law judges from political influence.
"You want to ratchet that down," Kagan said. "Isn’t that interfering with decisional independence?"
Anton Metlitsky, a private lawyer appointed by the Supreme Court to defend the SEC’s appointment process, told the justices that the commission’s judges don’t have enough authority to warrant the "officer" designation. He said the SEC must issue a formal order before any decision by an administrative law judge kicks in.
Kagan questioned whether Metlitsky’s position could be squared with the Supreme Court’s 1991 Freytag v. Commissioner decision, which declared special trial judges of the U.S. Tax Court to be "officers."
"It’s just so hard to get around this -- the commonalities of these judges and the judges in Freytag," Kagan said.