NFIB Urges Supreme Court to Uphold Constitution’s Structural Limitations

Date: October 18, 2023

SEC v. Jarkesy concerns the constitutionality of the SEC’s enforcement proceedings

WASHINGTON, D.C. (Oct. 18, 2023)NFIB filed an amicus brief today in the case Securities and Exchange Commission v. George R. Jarkesy, Jr. and Patriot28, L.L.C. at the United States Supreme Court. The case considers whether the Securities and Exchange Commission’s (SEC) in-house enforcement proceedings are unconstitutional.

“Small businesses depend on consistent and fair enforcement from governing bodies,” said Beth Milito, Executive Director of NFIB’s Small Business Legal Center. “The SEC has been allowed to wield the power of the Executive Branch without proper checks and balances. NFIB is hopeful that the Court will uphold the ruling of the Fifth Circuit Court and enforce the structural limitations of the Constitution.”

The brief argues two main points: 1) The right to a jury trial has been an essential check against government overreach throughout the history of the United States, and the Securities and Exchange Commission’s (SEC) enforcement proceedings violated the Seventh Amendment, and 2) The SEC’s enforcement proceedings are furthermore unconstitutional because they are handled by Administrative Law Judges (ALJ) who function as an extension of the Executive Branch yet cannot be directly removed by the President due to multiple layers of tenure protection, which is prohibited by Article II of the Constitution.

NFIB’s brief was filed with the Chamber of Commerce in support of the Respondents.

The NFIB Small Business Legal Center protects the rights of small business owners in the nation’s courts. NFIB is currently active in more than 40 cases in federal and state courts across the country and in the U.S. Supreme Court.

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