William Baude Comments on Oral Arguments in SEC v. Jarkesy

The Seventh Amendment, Private Rights, and Administrative Penalties

The federal government finances and helps to build the interstate highway system. It has to decide where those highways will go. If Congress or the Department of Transportation decides to have a hearing about competing highway locations, it does not need to have a judge adjudicate that hearing, and it does not have to involve a jury.

On the other hand, imagine that after building the highways, the federal government wants to regulate traffic accidents on them and also set up a federal tribunal to apply these regulations between private parties. It is pretty clear that this tribunal would need to be an Article III court, and that these trials would involve a jury. (I am borrowing this second example from Chief Justice Roberts at the oral argument in SEC v. Jarkesy this week.)

But what about the possibilities in between these two? For instance, in Jarkesy the Securities and Exchange Commission, a branch of the federal government, wishes to exact penalties from somebody who traded in violation of the securities laws. It does so in front of an administrative officer who is part of the SEC, not a court or a jury. Is that more like locating highways, or more like adjudicating a highway accident?

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