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<i>“The accumulation of all powers, legislative, executive, and judiciary, in the same hands … may justly be pronounced the very definition of tyranny.” — </i><a href="https://avalon.law.yale.edu/18th_century/fed47.asp" target=_blank><i>James Madison, Federalist 47</i></a>

So, were the sainted Madison to see today’s federal government, he would recognize the momentousness of the case the <a href="https://www.supremecourt.gov/DocketPDF/22/22-859/256566/20230308164750050_Jarkesy.pet%20Final.pdf" target="_blank">Supreme Court will hear</a> Wednesday, when <a href="https://www.reuters.com/legal/legalindustry/sec-administrative-enforcement-process-called-into-question-highlighting-2023-11-16/" target="_blank">George Jarkesy, a hedge fund founder</a>, will at last <a href="https://www.scotusblog.com/case-files/cases/securities-and-exchange-commission-v-jarkesy/" target="_blank">have his day in court</a>.

If he prevails, the constitutional right of access to courts will be vindicated, constitutionally dubious delegations of congressional power will be curtailed, and administrative state agencies will have to respect the separation of powers. Let us hope for what progressives fear: the end of government as they have transformed it.

The Securities and Exchange Commission, having <a href="https://www.sec.gov/news/press-release/2013-2013-46htm#:~:text=Jarkesy%20mispriced%20certain%20holdings%20to,Bank%20worked%20with%20the%20funds." target=_blank>charged Jarkesy in 2013</a> with fraudulently valuing some assets, put his case not before a federal court and jury but before an SEC administrative law judge. The SEC judge sided with the SEC, imposing a financial penalty, requiring Jarkesy to disgorge some earnings and barring him from the securities industry.

Jarkesy wants the Supreme Court to affirm, and the SEC wants it to overturn, <a href="https://reason.com/volokh/2022/08/17/the-good-the-bad-and-the-ugly-of-jarkesy-v-sec/" target=_blank>an appellate court’s ruling</a> that the <a href="https://constitution.congress.gov/browse/amendment-7/" target=_blank>Constitution’s Seventh Amendment</a> guarantees Jarkesy a right to trial by jury. And that Congress unconstitutionally delegated to the SEC, without the guidance of an intelligible principle, the power to decide the judicial forum for adjudicating disputes. And that the SEC’s administrative law judges are unconstitutionally exempt from presidential removal for policy reasons, which impedes the president’s constitutional duty to see that the laws are “faithfully executed.”

Many targets of SEC enforcement quickly settle cases that the SEC assigns not to a regular court with a neutral judge but to its in-house tribunals. This practice is analogous to prosecutors overcharging defendants to coerce them into plea bargains, vitiating their right to jury trials.

The use of agencies’ courts began in the 1970s. In 1994, law professor Gary S. Lawson — then at Northwestern, now at Boston University — published <a href="https://scholarship.law.bu.edu/cgi/viewcontent.cgi?article=1941&context=faculty_scholarship" target=_blank>a Harvard Law Review article</a> (“The Rise and Rise of the Administrative State”) describing what he called the typical enforcement activities of a typical federal agency, the Federal Trade Commission:

“The Commission promulgates substantive rules of conduct. The Commission then considers whether to authorize investigations into whether the Commission’s rules have been violated. If the Commission authorizes an investigation, the investigation is conducted by the Commission, which reports its findings to the Commission. If the Commission thinks that the Commission’s findings warrant an enforcement action, the Commission issues a complaint. The Commission’s complaint that a Commission rule has been violated is then prosecuted by the Commission and adjudicated by the Commission. This Commission adjudication can either take place before the full Commission or before a semi-autonomous Commission administrative law judge. If the Commission chooses to adjudicate before an administrative law judge rather than before the Commission and the decision is adverse to the Commission, the Commission can appeal to the Commission. If the Commission ultimately finds a violation, then, and only then, the affected private party can appeal to an Article III court. But the agency decision, even before the bona fide Article III tribunal, possesses a very strong presumption of correctness on matters both of fact and of law.”

Incestuous, isn’t it? Today, Lawson says, the FTC still can operate like this, and other agencies often exercise such abusive power.

The <a href="https://ij.org/press-release/family-farm-will-appeal-ruling-upholding-ruinous-fines-imposed-by-biased-agency-judges/" target="_blank">Institute for Justice is representing</a> in an appellate court Joe and Russell Marino, former operators of a New Jersey vegetable farm, which has closed largely because of financial uncertainties caused by the Labor Department. In 2016, department agents notified the Marinos that they were being penalized more than $550,000, with over $320,000 of that because of a single paperwork error. Thus began a five-year ordeal before Labor Department agency judges. After the Marinos lost a four-day trial before a 25-year Labor Department employee, they appealed to a panel of five more judges appointed by the labor secretary. Unsurprisingly, they lost. The government is still trying to penalize them more than half a million dollars without allowing them their day in a real court.

By resisting such abuses, Jarkesy, like <a href="https://ij.org/case/sun-valley-administrative-appeal/" target=_blank>the Institute for Justice</a>, is defending the nation’s constitutional structure against unaccountable agencies operating as a fourth branch of government. Jarkesy is asking the Supreme Court to demonstrate, for the benefit of everyone but administrative state bureaucrats, <a href="https://constitutioncenter.org/the-constitution/historic-document-library/detail/alexander-hamilton-federalist-no-78-1788#:~:text=But%20it%20is%20easy%20to,major%20voice%20of%20the%20community." target=_blank>something that Alexander Hamilton said</a> (in Federalist 78) would be required to defend the Constitution against depredations by the elected branches: an “uncommon portion of fortitude.”

1977 Pulitzer Prize for commentary

1979 National Magazine Awards: Finalist in the essay and criticism category

1978 National Headliners Award

1980 Silurian Award for editorial writing

1985 The Washington Journalism Review named Will best writer, any subject

1997 Named among the 25 most influential Washington journalists by the National Journal

The Pursuit of Happiness and Other Sobering Thoughts

The Pursuit of Virtue and Other Tory Notions

The Morning After: American Successes and Excesses 1981-1986

Suddenly: The American Idea Abroad and at Home 1986-1990

The Leveling Wind: Politics, the Culture, and Other News, 1990-1994

The Woven Figure: Conservatism and America's Fabric

With a Happy Eye, But ... America and the World, 1997-2002

One Man's America: The Pleasures and Provocations of Our Singular Nation

Statecraft as Soulcraft

The New Season: A Spectator's Guide to the 1988 Election

Men at Work: The Craft of Baseball

Restoration: Congress, Term Limits and the Recovery of Deliberative Democracy

The Conservative Sensibility

American Happiness and Discontents

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Oxford University

Princeton University

George F. Will writes a twice-weekly column on politics and domestic and foreign affairs. He began his column with The Post in 1974, and he received the Pulitzer Prize for commentary in 1977. His latest book, "American Happiness and Discontents," was released in September 2021.

George F. Will

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