Supreme Court rules US must enforce securities violations in court

Roberts wrote that Thursday’s decision was different from cases upholding administrative agencies that handle benefits and debts, such as the Social Security Administration, Internal Revenue Service, customs and immigration decisions.

Sotomayor, joined by Justices Elena Kagan and Ketanji Brown Jackson, wrote in a dissent that the majority shortchanged the federal government’s interest in ensuring public goods, such as fraud-free markets and a pollution-free environment.

Many agencies would not be able to enforce statutes which only contemplate internal administrative judges, leaving them with only the option of seeking new laws passed by Congress, Sotomayor wrote.

“The American People should not mistake judicial hubris with the protection of individual rights,” Sotomayor wrote.

Sotomayor read from a portion of her dissent, noting that hundreds of federal statutes were now in peril because of Thursday’s decision. Her dissent also accused the court’s majority of a “power grab” by the judiciary and weakening Congress’ power.

The decision could impact the ability of dozens of agencies to enforce federal rules, such as the Postal Service and the Federal Energy Regulatory Commission, Sotomayor wrote.

Sotomayor said that although the majority opinion kept the case focused on common-law fraud, it provided a blueprint for litigants to challenge administrative law judges throughout the federal government.

The decision is the latest in a series of cases in which the court, currently controlled by six Republican appointees, has ruled against the reach of federal agencies. That includes a new doctrine stating that Congress must speak clearly for agencies to act on “major questions” of political or economic significance.

The justices are also poised to rule in the coming days on the standard they use for reviewing agency decisions and giving less deference to administrative agencies.