Supreme Court conservatives poised to back Trump in FTC firing case

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By John Kruzel and Andrew Chung

WASHINGTON, Dec 8 (Reuters) – Conservative U.S. Supreme Court justices signaled on Monday they will uphold the legality of Donald Trump’s firing of a Federal Trade Commission member and give a historic boost to presidential power while also imperiling a 90-year-old legal precedent. 

The justices heard about 2-1/2 hours of arguments in the Justice Department’s appeal of a lower court’s decision that the Republican president exceeded his authority when he moved to dismiss Democratic FTC member Rebecca Slaughter in March before her term was set to expire. The court, which has a 6-3 conservative majority, has backed Trump in a series of cases since he returned to the presidency in January.

The conservative justices appeared sympathetic to the Trump administration’s arguments that tenure protections given by Congress to the heads of independent agencies unlawfully encroached on presidential power under the U.S. Constitution. The liberal justices said the administration’s view in the case would lead to a massive increase in presidential power. 

U.S. Solicitor General D. John Sauer, arguing for the administration, urged the court to overturn a Supreme Court precedent in a 1935 case called Humphrey’s Executor v. United States that has constrained presidential power by protecting the heads of independent agencies from removal. The court in recent decades has narrowed the precedent’s reach but stopped short of overturning it.

Conservative Chief Justice Roberts told Amit Agarwal, a lawyer for Slaughter, that the FTC in 1935 was far less powerful than today, suggesting the precedent is a relic of the past.

“Humphrey’s Executor is just a dried husk of whatever people used to think it was,” Roberts said of the unanimous ruling that rebuffed Democratic President Franklin Roosevelt’s attempt to fire an FTC member over policy differences despite tenure protections given by Congress.

“It was addressing an agency that had very little, if any, executive power, and that may be why they were able to attract such a broad support on the court at the time,” Roberts said.

‘CONTROL OVER EVERYTHING’

Liberal Justice Elena Kagan underscored that a ruling favoring Trump would hand the president “massive, unchecked, uncontrolled power.” Kagan emphasized that Congress has delegated significant power to federal agencies that regulate key aspects of American life and business, from finance to air traffic safety to labor relations.

“What you are left with is a president … with control over everything, including over much of the lawmaking that happens in this country,” Kagan added.

Liberal Justice Ketanji Brown Jackson expressed concerns that letting presidents fire the heads of independent agencies would undermine issues that Congress decided should be handled by nonpartisan experts in independent agencies.

“So having a president come in and fire all the scientists, and the doctors, and the economists and the PhDs, and replacing them with loyalists and people who don’t know anything is actually not in the best interest of the citizens of the United States,” Jackson told Sauer.

Sauer countered that the impact would be the president “having control over the executive branch, which he must and does have under our Constitution.”

Overturning or narrowing Humphrey’s Executor would bolster Trump’s authority at a time when he already has been testing the constitutional limits of presidential powers in areas as diverse as immigration, tariffs and domestic military deployments.

After a federal judge and an appeals court ruled against Trump, the Supreme Court in September let his ouster of Slaughter take effect while agreeing to hear the administration’s appeal. 

INDEPENDENT AGENCIES

Independent agencies are government entities whose heads have been given tenure-protected terms by Congress to keep these offices free from political interference by presidents.

The Constitution sets up a separation of powers among the U.S. government’s coequal executive, legislative and judicial branches. Sauer said the Humphrey’s Executor precedent “continues to tempt Congress to erect, at the heart of our government, a headless fourth branch insulated from political accountability and democratic control.”

Liberal Justice Sonia Sotomayor said independent agencies have existed throughout U.S. history, and challenged Sauer to explain why the court should make such a drastic change to the government’s structure. 

“Neither the king, nor parliament nor prime ministers in England at the time of the founding (of the United States) ever had an unqualified removal power,” Sotomayor said, adding, “You’re asking us to destroy the structure of government and to take away from Congress its ability to protect its idea that a government is better structured with some agencies that are independent.”

A 1914 law passed by Congress permits a president to remove FTC commissioners only for cause – such as inefficiency, neglect of duty or malfeasance in office – but not for policy differences. Similar protections cover officials at more than two dozen other independent agencies.

Slaughter was one of two Democratic commissioners who Trump moved to fire in March from the consumer-protection and antitrust agency before her term expires in 2029.

‘COLLECTIVE WISDOM’

“We are asking the court to adhere to all of its precedents and to give effect to the collective wisdom and experience of all three branches of government,” Agarwal said. By contrast, Agarwal said, the administration is “asking you to abandon precedent after precedent, after precedent.” 

Conservative justices pressed Agarwal on his contention that the president has the absolute power to fire at will only the heads of agencies that wield core presidential powers, such as presidential authority over the military, law enforcement and foreign affairs.

They also asked Agarwal to explain whether any limits exist on what Congress could do to transform executive departments into multi-member commissions like the FTC and prevent the president from firing members at will. 

QUESTIONS ABOUT THE FEDERAL RESERVE

Conservative Justice Brett Kavanaugh expressed concern to Sauer about threatening the independence of the Federal Reserve, the U.S. central bank. 

“How would you distinguish the Federal Reserve from agencies such as the Federal Trade Commission?” Kavanaugh asked Sauer.

Sauer acknowledged that the court has previously seemed inclined to protect the Federal Reserve’s independence. Sauer cited a May ruling allowing Trump’s firing of two Democratic members of federal labor boards in which the court’s conservatives described the Fed as possessing a unique structure and historical tradition.

“The Federal Reserve has been described as sui generis,” Sauer said, using a Latin term meaning unique. “Any issues of removal restrictions as a member of the Federal Reserve would raise their own set of unique, distinct issues, as this court said.”

In another case involving presidential powers, the court will hear January 21 arguments in Trump’s attempt to oust Federal Reserve Governor Lisa Cook, a move without precedent that challenges the central bank’s independence.

Some justices asked questions about how far a ruling in Trump’s favor on Slaughter would extend, potentially imperiling job protections even for certain adjudicatory bodies like U.S. Tax Court and Court of Federal Claims.

Sauer advanced arguments embracing the “unitary executive” theory. This conservative legal doctrine sees the president as possessing sole authority over the executive branch, including the power to fire and replace heads of independent agencies at will despite legal protections for these positions. 

The Supreme Court is expected to rule by the end of June.

(Reporting by John Kruzel and Andrew Chung; Additional reporting by Jan Wolfe; Editing by Will Dunham)