DOJ Ends Defense of Agency Judge Removal Law in Walmart Suit (1)

The Justice Department in oral arguments Friday conceded the protections against removing its administrative law judges are unconstitutional, while also asserting before a federal appeals court that this flaw shouldn’t doom DOJ’s enforcement powers against Walmart Inc. or anyone else.

The Walmart case at the US Court of Appeals for the Eleventh Circuit is one of a flurry of court challenges to the in-house judge systems that handle enforcement actions within many federal agencies.

In appealing a federal district court’s finding that sided with Walmart, federal officials argued the court should sever the unconstitutional removal protections and otherwise leave ALJs with power to act. Walmart sued to challenge the ALJ system where it was defending itself against accusations of immigration law violations.

Walmart is “saying all I-9 enforcement has to stop unless and until Congress is able to act,” to revise the unconstitutional statute, DOJ attorney Joshua M. Salzman told the three-judge panel.

“And it’s not just I-9 enforcement. That actually wildly understates” the implications of Walmart’s argument, he said. “There are 2,000 ALJs spread across dozens of agencies” who enforce laws governing everything from consumer product safety to financial markets.

The DOJ’s abandonment of its previous argument that the removal protections for agencies’ in-house judges are constitutional prompted Judges Adalberto Jordan and Jill A. Pryor to question whether the court might need to appoint a third party to take up the defense of those protections’ constitutionality. The court can’t simply accept the government’s concession of unconstitutionality without evaluating the issue for itself, they said.

“You’re asking us to assume unconstitutionality? That’s odd,” Jordan said.

The US District Court for the Southern District of Georgia sided with Walmart in a March 2024 decision, ruling that the statutory protections against removing ALJs shields them from the president’s supervisory powers granted under Article II of the Constitution.

SpaceX and other corporations have brought similar challenges that cast doubt on the authority of agencies’ in-house judges within the Justice Department, Department of Labor, Drug Enforcement Administration, and others.

Jeffrey R. Johnson, attorney from Jones Day who argued for Walmart, urged the appellate court to view the unconstitutional removal protections as dooming the entire ALJ scheme, in the same way it would treat an official who’s improperly appointed as lacking legal power to carry out government duties.

“If the person lacks authority to act, we’re done here,” he said.

Removal Shield Challenges

Federal law protects ALJs from being terminated without good cause. Courts across the country are hearing challenges to similar removal protections not only for agency judges but other kinds of federal officials.

Among those pending cases, the D.C. Circuit heard arguments Thursday in an appeal over two Starbucks Corp. workers’ challenge to National Labor Relations Board member protections. Like the Walmart case, the appellate judges in D.C. wrestled with the problem of the government attorneys now agreeing with the challengers that the removal protections are unconstitutional.

Courts have found various federal laws unconstitutional when they limit the president’s power to remove executive branch officials, including the Eleventh Circuit in 2024 when it ruled against removal protections for the head of the Social Security Administration.

In a separate but related thread of cases, courts are considering the legality of President Donald Trump’s removal of commissioners and board members from agencies historically protected as independent, including the Equal Employment Opportunity Commission, NLRB, and Merit Systems Protection Board.

But the case law isn’t directly comparable to Walmart’s challenge against the in-house judge system at DOJ, Pryor said. That’s partly because, unlike the head of Social Security, the ALJs serve underneath the attorney general and a chief administrative officer, both of whom the president can remove without having to show good cause. The chief administrative officer can review and override an ALJ’s decisions in individual enforcement actions, she said.

“We have no holding on this. We have no precedent that binds us,” Pryor said. She added at the end of the hearing, “I don’t know why it’s unconstitutional.”

Judge Frank M. Hull, a Clinton appointee, heard the case alongside Jordan and Pryor, both Obama appointees.

The case is Walmart Inc. v. King, 11th Cir., No. 24-11733, oral arguments held 5/16/25