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SEC In-House Judge Removal Dispute OK, Appeals Court Says (1)

Dec. 13, 2021, 8:38 PMUpdated: Dec. 13, 2021, 10:14 PM

An accountant facing an SEC enforcement action deserves another shot at her challenge to the constitutionality of the agency’s in-house judge proceedings because federal district courts have jurisdiction over those claims, the full Fifth Circuit said in a split ruling Monday.

Federal securities laws don’t actually strip lower courts of jurisdiction to hear constitutional challenges like this one, the U.S. Court of Appeals for the Fifth Circuit said in a 9-7 en banc decision. An appellate panel previously said the district judge was right to toss on jurisdictional grounds Michelle Cochran’s suit alleging the Securities and Exchange Commission’s administrative ...