The Supreme Court Considers the Right to Trial by Jury

The Supreme Court on Wednesday will hear the first of two landmark cases this term challenging the runaway administrative state. At stake in SEC v. Jarkesy is a bedrock constitutional principle that colonists fought to defend in the American revolution: the right to a trial by jury.

Congress in recent decades has expanded the enforcement powers of administrative agencies. The 2010 Dodd-Frank Act granted the Securities and Exchange Commission unbridled power to seek penalties administratively against any individual for violating securities laws. Democrats wanted to make it easier for the agency to punish misconduct.

Administrative tribunals let SEC prosecutors present hearsay evidence and unauthenticated documents that would be inadmissible in a traditional federal court. Defendants also enjoy fewer procedural protections including the tools of legal discovery. No surprise, then, that the SEC wins almost all cases it charges in-house. At the time of hedge-fund founder George Jarkesy’s administrative trial in 2014, the SEC had a 100% in-house victory rate versus 61% in federal court in 200 contested cases.