In the ongoing federal court case between Barbara Duka and the SEC in which Duka is trying to stop an administrative enforcement action against her, Duka filed a brief this week opposing the SEC’s motion to dismiss her complaint and in further support of a preliminary injunction. One issue in dispute is whether SEC ALJs are inferior officers who must be properly appointed. In Duka’s opposition, she argues that they “are indeed inferior officers, given their ‘significant authority.’” The SEC contends otherwise, citing the fact that ALJs cannot issue “final” decisions, a form of authority that Duka claims is not determinative. Regardless, she says, the “effective finality” of their decisions demonstrates their true authority – “[i]n practice, the SEC ALJ’s initial decision is often the final word.” According to Duka’s counsel, they found 167 initial decisions on Westlaw from 2014 in which the Commission endorsed an ALJ’s decision as final without reviewing it.
Our prior reporting on the case can be read here. Brune & Richard represents the plaintiff in an action making similar claims.