In Securities & Exchange Commission v. Jarkesy, the U.S. Supreme Court ruled that the Seventh Amendment did not allow the Securities & Exchange Commission (SEC) to assess civil penalties via administrative adjudication without a jury trial. In so ruling, the Court rejected the SEC’s claim that the public rights exception applied to permit the SEC to bypass the Seventh Amendment. The Court purported to distinguish Jarkesy from Atlas Roofing, in which the Court had applied its most expansive interpretation of the public rights doctrine by permitting an agency to assess civil penalties under the rationale that the agency had brought the action under a statutory claim.
This Comment explores the history of the public rights doctrine since its origin in the mid-nineteenth century. This Comment describes three principal themes: the Court’s gradual restriction of the public rights doctrine over the past few decades, the Court’s separation-of-powers jurisprudence in other analogous areas of the law, and the limitations the Court has imposed on stare decisis. All three of these factors indicate that the Court, without explicitly overruling Atlas Roofing, has limited the holding of that case to such an extent that no clear rationale can justify it. The public rights doctrine, therefore, is no longer practically viable. This Comment concludes that the Court will likely entirely reject the public rights doctrine in the near future.
While the public rights doctrine itself is a niche area of the law, the Court’s rejection of its prior, more permissive attitude toward agency adjudication signals that litigants challenging executive agency action will have a better chance of bringing their cases in federal court with the advantage of a jury. The Court’s treatment of the public rights doctrine in Jarkesy exemplifies the methodology the Court may apply in other areas of the law to restrict the scope of other doctrines, especially those it considers to be incompatible with a formalist separation-of-powers jurisprudence.
