The conservative justices on the Supreme Court appear to be skeptical of the Securities and Exchange Commission’s (SEC) use of in-house tribunals to adjudicate certain securities disputes. During the recent oral argument of the case, SEC v. Lucia, Justice Anthony Kennedy expressed concern about the tribunal’s power and Justice Samuel Alito asked whether this type of tribunal can truly be considered independent. Chief Justice John Roberts echoed similar concerns, asking whether allowing such tribunals to operate could risk putting the SEC “in a position of putting its thumb on the scale.” The justices also discussed whether the SEC has an incentive to hold hearings in-house rather than in federal courts in order to obtain more favorable outcomes. It remains to be seen what the justices will decide in this case.
