Last week, the U.S. Supreme Court paved a path for petitioners
to assert constitutional challenges to the structure of U.S.
Securities and Exchange Commission (“SEC”) and U.S.
Federal Trade Commission (“FTC”) administrative
hearings in federal courts.
At issue in the consolidated Axon Enterprise, Inc. v.
FTC, No. 21-86 and SEC v. Cochran, No. 21-1239
was whether district courts have jurisdiction to hear
constitutional challenges to the SEC and FTC's administrative
law judge-led hearings. In a unanimous decision authored
by Justice Elena Kagan, the Supreme Court held that pursuant to 28
U.S.C. § 1331, district courts have jurisdiction to hear such
challenges.1 Op. at 2.
Under the Securities Exchange Act of 1934 (the “Exchange
Act”) and the Federal Trade Commission Act (the “FTC
Act”), objections to such administrative proceedings
typically are made with the respective Commissions and then, if
appealed, in a federal court of appeals. Op. at 2. Instead of
