United States v. Arthrex, Inc.

Justice Thomas to Respondents (26:12): What would be your test for whether someone is an inferior officer? It seems to be almost a totality of the circumstances.

Alan Morrison: Your Honor, we think that courts should primarily defer to Congress’s determination about whether officers are inferior officers. When Congress authorized the Secretary to appoint APJs, the Senate gave up the power to oversee their appointment that it has for principal officers. In addition, when the President signed the AIA into law, he surrendered his power to appoint APJs. This should create a rebuttable presumption that the APJs are inferior officers.

The test offered by Arthrex’s lawyers is appealing because it appears quite simple and easy to apply: if the person has final decisional authority, he or she must be a principal officer. But as Justice Breyer pointed out, there are a wide range of government persons involved in a variety of adjudications, and making them all officers who must be appointed by a President and confirmed by the Senate is undesirable and impractical. And that approach assumes, contrary to reality, that all final decisions are like those made by APJs—that they have great financial or other significance, and that one size fits all. Therefore, the Arthrex test is too blunt an instrument.

Our “deference to Congress” approach has the advantage of a bright-line test, like Arthrex’s test, because it assumes that Congress’s designation is correct; courts will only override Congress’s decision in egregious circumstances, which are easier to identify than close-call cases such as this one. But our approach also has the advantage of a more holistic approach because it allows Congress to treat appointed officers in different government programs differently.

Picking the right test to decide Arthrex may be more important than whether the Court correctly concludes that APJs are inferior or principal officers—especially with the status of ALJs at Social Security and AJs deciding immigration cases right behind.

Justice Barrett to Respondents (39:55): So I want you to assume for the purposes of my question that you lose on the Appointments Clause issue, and I want to ask you about remedy. So, you know, the federal -- well, think about -- one unusual thing about the remedy here is that it's not one specific provision in this statutory scheme that's being challenged as unconstitutional.

It's the way that they work together. You know, so we could, if we decided that it was unconstitutional, perhaps make all of the APJs subject to -- say they're principal officers, and so they have to be subject to presidential appointment, senatorial confirmation.

We could say, listen, we're going to strike the provision in the statute that says only the PTAB may grant rehearings so that the director has that authority.

We could make them maybe at-will employees, so they're removable at the discretion of the director without having to go through the full process that we discussed before. That's a lot of discretion to give us in trying to shape a remedial -- a remedy here. Why should we even assert the authority to do that, to sever?

John Harrison: Justice Barrett, the question whether the Court may or should sever the statute, in the sense of altering the statute's content to bring it into accord with the Constitution, does not arise. If a court finds that the statutory law before it is unconstitutional, either because a provision is separately unconstitutional or because a combination of rules together is unconstitutional, the court does not face a question of remedy. Courts do not give remedies that change the content of statutory law, any more than they give remedies that cause statutes that previously were invalid to become valid. The Constitution causes unconstitutional rules and combinations of rules to be invalid, and statutes govern their own operation in the contingency of unconstitutionality. Sometimes statutes deal with that contingency explicitly, as with severability clauses, or with an explicit fallback provision as in Bowsher v. Synar. When a court must find an implicit fallback system, it may have to exercise judgment in finding the statute's meaning. But a court making judgments of statutory construction is not exercising the kind of discretion that goes into shaping an injunction, for example.

In this case, the Court might conclude that although none of the statutory rules governing APJs is unconstitutional in isolation, the rules are unconstitutional in combination. A court that concludes that a combination of statutory rules is unconstitutional might infer from the statute's text and structure an implicit fallback system under which the entire combination is inoperative, so that here APJs have no authority to decide cases. Or a court might infer that the fallback eliminates one or more components of the statutory system, so as to produce a system that is constitutional and operative. The court is not exercising more discretion in reaching one of those results rather than the other, because the court is not exercising discretion. In finding the fallback system, the court is identifying statutory content using tools of statutory interpretation. Describing the fallback inquiry as remedial is a figure of speech that must be used with care. The question is not whether the Court should make APJs at-will employees. The question, if the statutes as written are unconstitutional, is whether the statutory fallback system does so. The Court has and needs no authority to sever. It need only identify the law and apply the law to the case.