“Lower courts continue to rubber-stamp the agency’s choice of venue rather than allowing federal courts to consider the constitutionality of the agency’s structure.”
—John Masslon, WLF Senior Litigation Counsel

Click here for WLF’s brief.

WASHINGTON, DC— Washington Legal Foundation (WLF) today urged the U.S. Supreme Court to hold that federal courts have statutory jurisdiction to consider parties’ constitutional challenges to agency structures.

The case arises from Axon’s acquisition of a failing competitor. The Federal Trade Commission alleges that the acquisition was anticompetitive and violated the antitrust laws. Axon sued in federal court, arguing that the FTC’s structure and procedures are unconstitutional. Later that day, the FTC began administrative proceedings. The District Court held that it lacked subject-matter jurisdiction over Axon’s claims because Congress intended for the FTC to decide those issues and the Ninth Circuit affirmed.

In its amicus brief supporting Axon, WLF argues that defendants have a right to have their constitutional challenges to an agency’s structure adjudicated by an Article III tribunal. In Thunder Basin, the Supreme Court announced three factors that courts must consider when analyzing whether Congress stripped district courts of jurisdiction to hear pre-enforcement challenges. But lower courts have ignored two of those factors—whether a claim is wholly collateral to the merits of a case and whether the agency has expertise on the question—and focused solely on whether the defendant can obtain meaningful judicial review of an adverse agency decision. Lower courts have then impermissibly allowed illusory review to satisfy the meaningful-judicial-review factor.  

WLF’s brief also explains why the Ninth Circuit’s decision discourages parties from raising Appointments Clause violations. The Supreme Court has explained that the remedy for an Appointments Clause violation should encourage those challenges. This rationale applies with greater force when examining whether a court can decide the constitutional issue at all. Allied Educational Foundation joined WLF on the brief.