Kabani & Company, Inc., et al. v. Securities and Exchange Commission

In Lucia v. SEC, this Court held that administrative law judges of the United States Securities and Exchange Commission are “Officers of the United States” subject to the Appointments Clause, and it reaffirmed that “‘one who makes a timely challenge to the constitutional validity of the appointment of an officer who adjudicates his case’ is entitled to relief”—specifically, “a new ‘hearing before a properly appointed official.’” 138 S. Ct. 2044, 2055 (2018) (quoting Ryder v. United States, 515 U.S. 177, 182-83 (1995)). Lower courts, however, have struggled to define the contours of what constitutes a “timely challenge” to the validity of a government official’s appointment under the Appointments Clause. In this case, the Ninth Circuit added to the uncertainty by refusing to entertain Petitioners’ challenge to the appointment of the Public Company Accounting Oversight Board hearing officer who adjudicated their case, despite Petitioners’ having repeatedly contested the constitutional validity of the administrative framework of their proceeding at all stages—including challenging the appointment of that officer—because Petitioners did not specifically invoke “the Appointments Clause” as the basis for their structural constitutional objections. The question presented is: Whether petitioners who timely challenge the constitutional validity of the administrative framework, including the appointment of the officer adjudicating their case, are nonetheless ineligible for relief unless they specifically name “the Appointments Clause” as the basis for their constitutional objections.