Syllabus

NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.

SUPREME COURT OF THE UNITED STATES

Syllabus

AXON ENTERPRISE, INC. v. FEDERAL TRADE COMMISSION ET AL. CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

No. 21–86. Argued November 7, 2022—Decided April 14, 2023* Michelle Cochran and Axon Enterprise, Inc.—respondents in separate enforcement actions initiated in the Securities and Exchange Commis- sion (SEC) and the Federal Trade Commission (FTC)—each filed suit in federal district court challenging the constitutionality of the agency proceedings against them. When, as in the enforcement actions against Cochran and Axon, a Commission elects to institute adminis- trative proceedings to address statutory violations, it typically dele- gates the initial adjudication to an Administrative Law Judge (ALJ) with authority to resolve motions, hold a hearing, and then issue a decision. As prescribed by statute, a party objecting to the Commission proceedings makes its claims first within the Commission itself, and then (if needed) in a federal court of appeals. But the parties here sidestepped that review scheme and brought their claims in district court, seeking to enjoin the administrative proceedings. Cochran and Axon asserted that the tenure protections of the agencies’ ALJs render them insufficiently accountable to the President, in violation of separation-of-powers principles. Axon also attacked as unconstitu- tional the combination of prosecutorial and adjudicatory functions in the FTC. Each suit premised jurisdiction on district courts’ ordinary federal-question authority to resolve “civil actions arising under the Constitution, laws, or treaties of the United States.” 28 U. S. C. §1331. Cochran’s and Axon’s suits initially met the same fate: dismissal for lack of jurisdiction. The district court in Cochran’s case held that the —————— * Together with No. 21–1239, Securities and Exchange Commission et al. v. Cochran, on certiorari to the United States Court of Appeals for the Fifth Circuit. 2 AXON ENTERPRISE, INC. v. FTC

Syllabus

review scheme specified in the Securities Exchange Act—“administra- tive review followed by judicial review in a federal court of appeals”— “implicitly divest[s] district courts of jurisdiction” over “challenges to SEC proceedings,” including Cochran’s constitutional ones. Likewise, the district court in Axon’s case found that the FTC Act’s comparable review scheme displaces §1331 jurisdiction for claims concerning the FTC’s adjudications. On appeal, the Ninth Circuit affirmed the dis- trict court’s dismissal of Axon’s constitutional challenges to the FTC proceeding, concluding that the claims were the type that fell within the FTC Act’s review scheme. But the en banc Fifth Circuit disagreed as to the equivalent SEC question, finding that Cochran’s claim would not receive “meaningful judicial review” in a court of appeals; that the claim was “wholly collateral to the Exchange Act’s statutory-review scheme”; and that the claim fell “outside the SEC’s expertise.” Held: The statutory review schemes set out in the Securities Exchange Act and Federal Trade Commission Act do not displace a district court’s federal-question jurisdiction over claims challenging as uncon- stitutional the structure or existence of the SEC or FTC. Pp. 7–18. (a) Although dis