Seila Law LLC v. Consumer Financial Protection Bureau

591 U.S. ___ (2020)

Case Year: 2020

Case Ruling: 5-4, Vacated and remanded

Opinion Justice: Roberts

Concurring Opinion: Thomas*

 

* Editors’ note: Justice Thomas wrote an opinion concurring in part and dissenting in part (joined by Justice Gorsuch); and Justice Kagan wrote an opinion concurring in the judgment and dissenting in part (joined by Justices Breyer, Ginsburg, and Sotomayor). We label their opinions concurring and dissenting, respectively, because those labels reflect their views on the part of the case excerpted below, on the constitutionality of the law. The excerpt omits sections of the opinions that cover severability.

In 2007, then-Professor (now U.S. Senator) Elizabeth Warren called for the creation of a new, independent federal agency focused on regulating consumer financial products.** Professor Warren believed the financial products marketed to ordinary American  households—credit  cards,  student loans, mortgages, and the like—had grown increasingly unsafe due to a “regulatory jumble” that paid too much attention to banks and too little to consumers. To remedy the lack of “coherent, consumer-oriented” financial regulation, she proposed “concentrat[ing] the review of financial products in a single location”—an independent agency modeled after the multimember Consumer Product Safety Commission.

Within months of Professor Warren’s writing, the subprime mortgage market collapsed, precipitating a financial crisis that wiped out over $10 trillion in American household wealth and cost millions of Americans their jobs, their retirements, and their homes. In the aftermath, the Obama administration encouraged Congress to establish an agency with a mandate to ensure that “consumer protection regulations” in the financial sector “are written fairly and enforced vigorously.” Like Professor Warren, the administration envisioned a traditional independent agency, run by a multi-member board with a “diverse set of viewpoints and experiences.”

In 2010, Congress acted on these proposals and created, in the Dodd-Frank Act, the Consumer Financial Protection Bureau (CFPB) as an independent financial regulator within the Federal Reserve System. Congress tasked the CFPB with “implement[ing]” and “enforc[ing]” a large body of financial consumer protection laws to “ensur[e] that all consumers have access to markets for consumer financial products and services and that markets for consumer financial products and services are fair, transparent, and competitive.”

Congress also vested the CFPB with potent enforcement powers, including the authority to conduct investigations, issue subpoenas and civil investigative demands, initiate administrative adjudications, and prosecute civil actions in federal court. To remedy violations of federal consumer financial law, the CFPB could seek restitution, as well as civil penalties of up to $1,000,000 for each day that a violation occurs. Since its inception, the CFPB has obtained over $11 billion in relief for over 25 million consumers, including a $1 billion penalty against a single bank in 2018.

The CFPB’s rulemaking and enforcement powers are coupled with extensive adjudicatory authority. The agency may conduct administrative proceedings to “ensure or enforce compliance with” the statutes and regulations it administers.

Congress’s design  for  the  CFPB  differed  from  the proposals of Professor Warren and the Obama administration in one critical respect. Rather than create a traditional independent agency headed by a multimember board or commission, Congress elected to place the CFPB under the leadership of a single Director. The CFPB Director is appointed by the President with the advice and consent of the Senate. The Director serves for a term of five years, during which the President may remove the Director from office only for “inefficiency, neglect of duty, or malfeasance in office.”

Unlike most other agencies, the CFPB does not rely on the annual appropriations process for funding. Instead, the CFPB receives funding directly from the Federal Reserve, which is itself funded outside the appropriations process through bank assessments. Each year, the CFPB requests an amount that the Director deems “reasonably necessary to carry out” the agency’s duties, and the Federal Reserve grants that request so long as it does not exceed 12% of the total operating expenses of the Federal Reserve (inflation adjusted). In recent years, the CFPB’s annual budget has exceeded half a billion dollars.

This case began in 2017 when CFPB issued a civil investigative demand (essentially a subpoena) to Seila Law, a law firm that provides debt-related legal services to clients, to determine whether the firm had “engag[ed] in unlawful acts or practices in the advertising, marketing, or sale of debt relief services.” The demand directed Seila Law to produce information and documents related to its business practices.

Seila Law asked the CFPB to set aside the demand, objecting that the agency’s leadership by a single Director removable only for cause was violated the separation of powers. The CFPB declined to address that claim and directed Seila Law to comply with the demand.

In response, Seila Law filed suit, claiming that the demand was invalid because the CFPB’s structure violated the Constitution. The District Court disagreed and ordered Seila Law to comply with the demand. After a Court of Appeals affirmed, Seila law brought its case to the Supreme Court.

The Court granted cert to address the constitutionality of the CFPB’s structure. The justices also requested argument on whether, if the CFPB’s structure violates the separation of powers, the CFPB Director’s removal protection can be severed from the rest of the Dodd-Frank Act.

This excerpt covers only the question of the constitutionality of the CFPB’s structure, not severability. [The Court found that the CFPB Director’s removal protection was severable from the rest of the Act.]

 

CHIEF JUSTICE ROBERTS delivered the opinion of the Court...

In the wake of the 2008 financial crisis, Congress established the Consumer Financial Protection Bureau (CFPB), an independent regulatory agency tasked with ensuring that consumer debt products are safe and transparent. In organizing the CFPB, Congress deviated from the structure of nearly every other independent administrative agency in our history. Instead of placing the agency under the leadership of a board with multiple members, Congress provided that the CFPB would be led by a single Director, who serves for a longer term than the President and cannot be removed by the President except for inefficiency, neglect, or malfeasance. The CFPB Director has no boss, peers, or voters to report to. Yet the Director wields vast rulemaking, enforcement, and adjudicatory authority over a significant portion of the U. S. economy. The question before us is whether this arrangement violates the Constitution’s separation of powers. …

While we need not and do not revisit our prior decisions allowing certain limitations on the President’s removal power, there are compelling reasons not to extend those precedents to the novel context of an independent agency led by a single Director.  Such an agency lacks a foundation in historical practice and clashes with constitutional structure by concentrating power in a unilateral actor insulated from Presidential control….

We therefore… hold that the CFPB’s leadership by a single individual removable only for inefficiency, neglect, or malfeasance violates the separation of powers.

Article II provides that “[t]he executive Power shall be vested in a President,” who must “take Care that the Laws be faithfully executed.” The entire “executive Power” belongs to the President alone. But because it would be “impossib[le]” for “one man” to “perform all the great business of the State,” the Constitution assumes that lesser executive officers will “assist the supreme Magistrate in discharging the duties of his trust.” 30 Writings of George Washington.

These lesser officers must remain accountable to the President, whose authority they wield. As Madison explained, “[I]f any power whatsoever is in its nature Executive, it is the power of appointing, overseeing, and controlling those who execute the laws.” That power, in turn, generally includes the ability to remove executive officials, for it is “only the authority that can remove” such officials that they “must fear and, in the performance of [their] functions, obey.”

The President’s removal power has long been confirmed by history and precedent...

The Court recognized the President’s prerogative to remove executive officials in Myers v. United States, Chief Justice Taft, writing for the Court, conducted an exhaustive examination of the First Congress’s  determination in 1789, the views of the Framers and their contemporaries, historical practice, and our precedents up until that point. He concluded that Article II “grants to the President” the “general administrative control of those executing the laws, including the power of appointment and removal of executive officers.” Just as the President’s “selection of administrative officers is essential to the execution of the laws by him, so must be his power of removing those for whom he cannot continue to be responsible.” “[T]o hold otherwise,” the Court reasoned, “would make it impossible for the President . . . to take care that  the  laws  be  faithfully  executed.” 

[Still, we have left in] place two exceptions to the President’s unrestricted removal power. First, in Humphrey’s Executor, decided less than a decade after Myers, the Court upheld a statute that protected the Commissioners of the FTC from removal except for “inefficiency, neglect of duty, or malfeasance in office.” In reaching that conclusion, the Court stressed that Congress’s ability to impose such removal restrictions “will depend upon the character of the office.”

Because the Court limited its holding “to officers of the kind here under consideration,” the contours of the Humphrey’s Executor exception depend upon the characteristics of the agency before the Court. Rightly or wrongly, the Court viewed the FTC (as it existed in 1935) as exercising “no part of the executive power.” Instead, it was “an administrative body” that performed “specified duties as a legislative or as a judicial aid.” It acted “as a legislative agency” in “making investigations and reports” to Congress and “as an agency of the judiciary” in making recommendations to courts as a master in chancery.  “To the extent that [the FTC] exercise[d] any executive function[,] as distinguished from executive power in the constitutional sense,” it did so only in the discharge of its “quasi-legislative or quasi-judicial powers.”

The Court identified several organizational features that helped explain its characterization of the FTC as non-executive. Composed of five members—no more than three from the same political party—the Board was designed to be “non-partisan” and to “act with entire impartiality.” The FTC’s duties were “neither political nor executive,” but instead called for “the trained judgment of a body of experts” “informed by experience.” And the  Commissioners’ staggered, seven-year terms enabled the agency to accumulate technical expertise and avoid a “complete change” in leadership “at any one time.” Ibid.

In short, Humphrey’s Executor permitted Congress to give for-cause removal protections to a multimember body of experts, balanced along partisan lines, that performed legislative and judicial functions and was said not to exercise any executive power….

While recognizing an exception for multimember bodies with “quasi-judicial”  or  “quasi-legislative”  functions, Humphrey’s Executor reaffirmed the core holding of Myers that the President has “unrestrictable power . . . to remove purely executive officers.” The Court acknowledged that between purely executive officers on the one hand, and officers that closely resembled the FTC Com- missioners on the other, there existed “a field of doubt” that the Court left “for future consideration.”

We have recognized a second exception for inferior officers in… Morrison v. Olson. [I]n Morrison, we upheld a provision granting good-cause tenure protection to an independent counsel appointed to investigate and prosecute particular alleged crimes by high-ranking Government officials. Backing away from the reliance in Humphrey’s Executor on the con- cepts of “quasi-legislative” and “quasi-judicial” power, we viewed the ultimate question as whether a removal restriction is of “such a nature that [it] impede[s] the President’s ability to perform his constitutional duty.” Although the independent counsel was a single person and performed “law enforcement functions that typically have been undertaken by officials within the Executive Branch,” we concluded that the removal protections did not unduly interfere with the functioning of the Executive Branch because “the independent counsel [was] an inferior officer under the Appointments Clause, with limited jurisdiction and tenure and lacking policymaking or significant administrative authority.”

These two exceptions—one for multimember expert agencies that do not wield substantial executive power, and one for inferior officers with limited duties and no policymaking or administrative authority—“represent what up to now have been the outermost constitutional limits of permissible congressional restrictions on the President’s removal power.”

Neither Humphrey’s Executor nor Morrison resolves whether the CFPB Director’s insulation from removal is constitutional. Start with Humphrey’s Executor.  Unlike  the New Deal-era FTC upheld there, the CFPB is led by a single Director who cannot be described as a “body of experts” and cannot be considered “non-partisan” in the same sense as a group of officials drawn from both sides of the aisle. Moreover, while the staggered terms of the FTC Commissioners prevented complete turnovers in agency leadership and guaranteed that there would always be some Commissioners who had accrued significant expertise, the CFPB’s single-Director structure and five-year term guarantee abrupt shifts in agency leadership and with it the loss of accumulated expertise.

In addition, the CFPB Director is hardly a mere legislative or judicial aid. Instead of making reports and recommendations to Congress, as the 1935 FTC did, the Director possesses the authority to promulgate binding rules fleshing out 19 federal statutes… And…the Director’s enforcement authority includes the power to seek daunting monetary penalties against private parties on behalf of the United States in federal court—a quintessentially executive power not considered in Humphrey’s Executor.

The logic of Morrison also does not apply. Everyone agrees the CFPB Director is not an inferior officer, and her duties are far from limited. Unlike the independent counsel, who lacked policymaking or administrative authority, the Director has the sole responsibility to administer 19 separate consumer-protection statutes that cover everything from credit cards and car payments to mortgages and student loans. It is true that the independent counsel in Morrison was empowered to initiate criminal investigations and prosecutions, and in that respect wielded core executive power. But that power, while significant, was trained inward to high-ranking Governmental actors identified by others,  and was confined to a specified matter in which the Department of Justice had a potential conflict of interest. By contrast, the CFPB Director has the authority to bring the coercive power of the state to bear on millions of private citizens and businesses, imposing even billion-dollar penalties through administrative adjudications and civil actions. In light of these differences, the constitutionality of the CFPB Director’s insulation from removal cannot be settled by Humphrey’s Executor or Morrison alone.

The question instead is whether to extend those precedents to the “new situation” before us, namely an independent agency led by a single Director and vested with significant executive power. We decline to do so. Such an agency has no basis in history and no place in our constitutional structure.

“Perhaps the most telling indication of [a] severe constitutional problem” with an executive entity “is [a] lack of historical precedent” to support it. An agency with a structure like that of the CFPB is almost wholly unprecedented.

After years of litigating the agency’s constitutionality, the Courts of Appeals, parties, and amici have identified “only a handful of isolated” incidents in which Congress has provided good-cause tenure to principal officers who wield power alone rather than as members of a board or commission. “[T]hese few scattered examples”—four to be exact—shed little light. …

In addition to being a historical anomaly, the CFPB’s single-Director configuration is incompatible with our constitutional structure. Aside from the sole exception of the  Presidency, that structure scrupulously avoids concentrating power in the hands of any single individual.

“The Framers recognized that, in the long term, structural protections against abuse of power were critical to preserving liberty.” Their solution to governmental power and its perils was simple: divide it. To prevent the “gradual concentration” of power in the same hands, they enabled “[a]mbition . . . to counteract ambition” at every turn…

The Executive Branch is a stark departure from all [the] division. The Framers viewed the legislative power as a special threat to individual liberty, so they divided that power to ensure that “differences of opinion” and the “jarrings of parties” would “promote deliberation and circum- spection” and “check excesses in the majority.” By contrast, the Framers thought it necessary to secure the authority of the Executive so that he could carry out his unique responsibilities. As Madison put it, while “the weight of the legislative authority requires that it should be . . . divided, the weakness of the executive may require, on the other hand, that it should be fortified.”

To justify and check that authority—unique in our constitutional structure—the Framers made the President the most democratic and politically accountable official in Government. Only the President (along with the Vice President) is elected by the entire Nation. And the President’s political accountability is enhanced by the solitary nature of the Executive Branch, which provides “a single object for the jealousy and watchfulness of the people.”…

The resulting constitutional strategy is straightforward: divide power everywhere except for the Presidency, and render the President directly accountable to the people through regular elections. In that scheme, individual executive officials will still wield significant authority, but that authority remains subject to the ongoing supervision and control of the elected President…

The CFPB’s single-Director structure contravenes this carefully calibrated system by vesting significant governmental power in the hands of a single individual accountable to no one. The Director is neither elected by the people nor meaningfully controlled (through the threat of removal) by someone who is. The Director does not even depend on Congress for annual appropriations. Yet the Director may unilaterally, without meaningful supervision, issue final regulations, oversee adjudications, set enforcement priorities, initiate prosecutions, and determine what penalties to impose on private parties. With no colleagues to persuade, and no boss or electorate looking over her shoulder, the Director may dictate and enforce policy for a vital segment of the economy affecting millions of Americans.

The CFPB Director’s insulation from removal by an accountable President is enough to render the agency’s structure unconstitutional. But several other features of the CFPB combine to make the Director’s removal protection even more problematic. In addition to lacking the most direct method of Presidential control—removal at will—the agency’s unique structure also forecloses certain indirect methods of Presidential control.

Because the CFPB is headed by a single Director with a five-year term, some Presidents may not have any opportunity to shape its leadership and thereby influence its activities. A President elected in 2020 would likely not appoint a CFPB Director until 2023, and a President elected in 2028 may never appoint one. That means an unlucky President might get elected on a consumer-protection platform and enter office only to find herself saddled with a holdover Director from a competing political party who is dead set against that agenda. To make matters worse, the agency’s single-Director structure means the President will not have the opportunity to appoint any other leaders— such as a chair or fellow members of a Commission or Board—who can serve as a check on the Director’s authority and help bring the agency in line with the President’s preferred policies.

The CFPB’s receipt of funds outside the appropriations process further aggravates the agency’s threat to Presidential control. The President normally has the opportunity to recommend or veto spending bills that affect the operation of administrative agencies. And, for the past century, the President has annually submitted a proposed budget to Congress for approval. Presidents frequently use these budgetary tools “to influence the policies of independent agencies.” But no similar opportunity exists for the President to influence the CFPB Director. Instead, the Director receives over $500  million per year to fund the agency’s chosen priorities. And the Director receives that money from the Federal Reserve, which is itself funded outside of the annual appropriations process.  This financial freedom makes it even more likely that the agency will “slip from the Executive’s control, and thus from that of the people.”…

In our constitutional system, the executive power belongs to the President, and that power generally includes the ability to supervise and remove the agents who wield executive power in his stead. While we have previously up- held limits on the President’s removal authority in certain contexts, we decline to do so when it comes to principal officers who, acting alone, wield significant executive power.

The Constitution requires that such officials remain dependent on the President, who in turn is accountable to the people. The judgment of the United States Court of Appeals for the Ninth Circuit is vacated, and the case is remanded for further proceedings consistent with this opinion.

It is so ordered.

JUSTICE THOMAS, with whom JUSTICE GORSUCH joins, concurring in part and dissenting in part.

The decision in Humphrey’s Executor poses a direct threat to our constitutional structure and, as a result, the liberty of the American people. The Court concludes that it is not strictly necessary for us to overrule that decision. But with today’s decision, the Court has repudiated almost every aspect of Humphrey’s Executor. In a future case, I would repudiate what is left of this erroneous precedent….

Article II of the Constitution vests “[t]he executive Power” in the “President of the United States of America,” and directs that he shall “take Care that the Laws be faithfully executed,” Of course, the President cannot fulfill his role of executing the laws without assistance. See Myers v. United States (1926). He therefore must “select those who [are] to act for him under his direction in the execution of the laws.” While these officers assist the President in carrying out his constitutionally assigned duties, “[t]he buck stops with the President.” “Since 1789, the Constitution has been understood to empower the President to keep [his] officers accountable—by removing them from office, if necessary.” The Framers “insist[ed]” upon “unity in the Federal Executive” to “ensure both vigor and accountability” to the people.

Despite the defined structural limitations of the Constitution and the clear vesting of executive power in the President, Congress has increasingly shifted executive power to a de facto fourth branch of Government—independent agencies. These agencies wield considerable executive power without Presidential oversight. They are led by officers who are insulated from the President by removal restrictions, “reduc[ing] the Chief Magistrate to [the role of] cajoler-in-chief.” But “[t]he people do not vote for the Officers of the United States. They instead look to the President to guide the assistants or deputies subject to his superintendence.” Because independent agencies wield substantial power with no accountability to either the President or the people, they “pose a significant threat to individual liberty and to the constitutional system of separation of powers and checks and balances.”

Unfortunately, this Court “ha[s] not always been vigilant about protecting the structure of our Constitution,” at times endorsing a “more pragmatic, flexible approach” to our Government’s design. Our tolerance of independent agencies in Humphrey’s Executor is an unfortunate example of the Court’s failure to apply the Constitution as written. That decision has paved the way for an ever-expanding encroachment on the power of the Executive, contrary to our constitutional design…

Humphrey’s Executor relies on one key premise: the notion that there is a category of “quasi-legislative” and “quasi-judicial” power that is not exercised by Congress or the Judiciary, but that is also not part of “the executive power vested by the Constitution in  the President.” Working from that  premise, the Court distinguished the “illimitable” power of removal recognized in Myers, Humphrey’s Executor, and upheld the FTC Act’s removal restriction, while simultaneously acknowledging that the Constitution vests the President with the entirety of the executive power.

The problem is that the Court’s premise was entirely wrong. The Constitution does not permit the creation of officers exercising “quasi-legislative” and “quasi-judicial powers” in “quasi-legislative” and “quasi-judicial agencies.” No such powers or agencies exist.  Congress lacks the authority to delegate its legislative power,  and it cannot authorize the use of judicial power by officers acting outside of the bounds of Article III. Nor can Congress create agencies that straddle multiple branches of Government. The Constitution sets out three branches of Govern- ment and provides each with a different form of power— legislative, executive, and judicial.  Free-floating agencies simply do not…

Continued reliance on Humphrey’s Executor to justify the existence of independent agencies creates a serious, ongoing threat to our Government’s design. Leaving these un- constitutional agencies in place does not enhance this Court’s legitimacy; it subverts political accountability and threatens individual liberty. We have a “responsibility to ‘examin[e] without fear, and revis[e] without reluctance,’ any ‘hasty and crude decisions’ rather than leaving ‘the character of [the] law impaired, and the beauty and harmony of the [American constitutional] system destroyed by the perpetuity of error.’”

JUSTICE KAGAN, with whom JUSTICE GINSBURG, JUSTICE BREYER, and JUSTICE SOTOMAYOR join, … dissenting in part.

As the majority explains, the CFPB emerged out of disaster. Collapse of the subprime mortgage market “precipitat[ed] a financial crisis that wiped out over $10 trillion in American household wealth and cost millions of cans their jobs, their retirements, and their homes.”…

No one had a doubt that the new agency should be independent…Congress has historically given—with this Court’s permission—a measure of independence to financial regulators like the Federal Reserve Board and the FTC. And agencies of that kind had administered most of the legislation whose enforcement the new statute transferred to the CFPB. The law thus included an ordinary for-cause provision— that the President could fire the CFPB’s Director only for “inefficiency, neglect of duty, or malfeasance in office.” That standard would allow the President to discharge the Director for a failure to “faithfully exe- cute[]” the law, as well as for basic incompetence. But it would not per- mit removal for policy differences.

The question here… is whether including that for-cause standard in the statute creating the CFPB violates the Constitution.

Applying our longstanding precedent, the answer is clear: It does not. This Court, as the majority acknowledges, has sustained the constitutionality of the FTC and similar in- dependent agencies. The for-cause protections for the heads of those agencies, the Court has found, do not impede the President’s ability to perform his own constitutional duties, and so do not breach the separation of powers. …

The removal power has not been “completely stripped from the President,” providing him with no means to “ensure the ‘faithful execution’ of the laws.” Rather, this Court has explained, the for-cause standard gives the President “ample authority to assure that [the official] is competently performing his or her statutory responsibilities in a manner that comports with” all legal obligations. In other words—and contra today’s majority—the President’s removal power, though not absolute, gives him the “mean- ingful[] control[]” of the Director that the Constitution requires.

The analysis is as simple as simple can be. The CFPB Director exercises the same powers, and receives the same removal protections, as the heads of other, constitutionally permissible independent agencies. How could it be that this opinion is a dissent?

The majority focuses on one (it says sufficient) reason: The CFPB Director is singular, not plural. And a solo CFPB Director does not fit within either of the majority’s supposed exceptions. He is not an inferior officer, so (the majority says) Morrison does not apply; and he is not a multimember board, so (the majority says) neither does Humphrey’s. Further, the majority argues, “[a]n agency with a [unitary] structure like that of the CFPB” is “novel”—or, if not quite that, “almost wholly unprecedented.” Finally, the CFPB’s organizational form violates the “constitutional structure” because it vests power in a “single individual” who is “insulated from Presidential control.” …

[None of these add up.]

The analysis in Morrison extended far beyond inferior officers. And of course that analysis had to apply to individual officers: The independent counsel was very much a person, not a committee. So the idea that Morrison is in a separate box from this case doesn’t hold up. Similarly, Humphrey’s and later precedents give no support to the majority’s view that the number of people at the apex of an agency matters to the constitutional issue. Those opinions mention the “groupness” of the agency head only in their background sections. The majority picks out that until-now-irrelevant fact to distinguish the CFPB, and constructs around it an until-now-unheard- of exception.

[The] CFPB’s single-director structure has a fair bit of precedent behind it. The Comptroller of the Currency. The Office of the Special Counsel (OSC). The Social Security Administration (SSA). The Federal Housing Finance Agency (FHFA). Maybe four prior agencies is in the eye of the beholder, but it’s hardly nothing. [T]he earliest of those agencies—the Civil- War-era Comptroller—is not [a] blip… The office is one in a long line, starting with the founding-era Comptroller of the Treasury (also one person), of financial regulators designed to do their jobs with some independence. As for the other three, [they are hardly] too powerless and too contested. On power, the SSA runs the  Nation’s largest  government  program—among  other  things, deciding all claims brought by its 64 million benefi- ciaries; the FHFA plays a crucial role in overseeing the mortgage market, on which millions of Americans annually rely; and the OSC prosecutes misconduct in the two-million-person federal workforce. All different from the CFPB, no doubt; but the majority can’t think those matters beneath a President’s notice. (Consider: Would the President lose more votes from a malfunctioning SSA or CFPB?) And controversial? Well, yes, they are. Almost all independent agencies are controversial, no matter how many directors they have. Or at least controversial among Presidents and their lawyers. That’s because whatever might be said in their favor, those agencies divest the President of some removal power….

Still more important, novelty is not the test of constitutionality when it comes to structuring agencies. See Mistretta v. United States (1989) (“[M]ere anomaly or innovation” does not violate the separation of powers). Congress regulates in that sphere under the Necessary and Proper Clause, not (as the majority seems to think) a Rinse and Repeat Clause. The Framers  understood  that  new  times  would  often require new measures, and exigencies often demand innovation. See McCulloch. In line with that belief, the history of the administrative sphere—its rules, its practices, its institutions—is replete with experiment and change. Indeed, each of the agencies the majority says now fits within its “exceptions” was once new; there is, as the saying goes, “a first time for everything.” So even if the CFPB differs from its forebears in having a single director, that departure is not itself “telling” of a “constitutional problem.” In deciding what this moment demanded, Congress had no obligation to make a carbon copy of a design from a bygone era.

And Congress’s choice to put a single director, rather than a multimember commission, at the CFPB’s head violates no principle of separation of powers. The purported constitutional problem here is that an official has “slip[ped] from the Executive’s control” and “supervision”—that he has become unaccountable to the President. So to make sense on  the majority’s own terms, the distinction between singular and plural agency heads must rest on a theory about why the former more easily “slip” from the President’s grasp. But the majority has nothing to offer. In fact, the opposite is more likely to be true: To the extent that such matters are measurable, individuals are easier than groups to supervise.

To begin with, trying to generalize about these matters is something of a fool’s errand. Presidential control, as noted earlier, can operate through many means—removal to be sure, but also appointments, oversight devices (e.g., centralized review of rulemaking or litigating positions), budgetary processes, personal outreach, and more.

The effectiveness of each of those control mechanisms, when present, can then depend on a multitude of agency-specific practices, norms, rules, and organizational features. In that complex stew, the difference between a singular and plural agency head will often make not a whit of difference. Or to make the point more concrete, a multimember commission may be harder to control than an individual director for a host of reasons unrelated to its plural character. That may be so when the two are subject to the same removal standard, or even when the individual director has greater formal job protection. Indeed, the very category of multimember commissions breaks apart under inspection, spoiling the majority’s essential dichotomy. Some of those commissions have chairs appointed by the President; others do not. Some of those chairs are quite powerful; others are not. Partisan balance requirements, term length, voting rules, and more—all vary widely, in ways that make a significant difference to the ease of presidential control. Why, then, would anyone distinguish along a simple commission/single-director axis when deciding whether the Constitution requires at-will re­moval?

But if the demand is for generalization, then the majority’s distinction cuts the opposite way: More powerful control mechanisms are needed (if anything) for commissions. Holding everything else equal, those are the agencies more likely to “slip from the Executive’s control.” Just consider your everyday experience: It’s easier to get one person to do what you want than a gaggle. So too, you know exactly whom to blame when an individual—but not when a group—does a job badly. The same is true in bureaucracies. A multimember structure reduces accounta-bility to the President because it’s harder for him to oversee, to influence—or to remove, if necessary—a group of five or more commissioners than a single director. Indeed, that is why Congress so often resorts to hydra-headed agencies… So, for example, Congress constructed the Federal Reserve as it did because it is “easier to protect a board from political control than to protect a single appointed official.” It is hard to know why Congress did not take the same tack when creating the CFPB. But its choice brought the agency only closer to the President—more exposed to his view, more subject to his sway. In short, the majority gets the matter backward: Where presidential control is the object, better to have one than many.

Because it has no answer on that score, the majority slides to a different question: Assuming presidential control of any independent agency is vanishingly slim, is a single- head or a multi-head agency more capable of exercising power, and so of endangering liberty? The majority says a single head is the greater threat because he may wield power “unilaterally” and “[w]ith no col- leagues to persuade.” So the CFPB falls victim to what the majority sees as a constitutional anti-power-concentration principle (with an exception for the President).

If you’ve never heard of a statute being struck down on that ground, you’re not alone. It is bad enough to “extrapolat[e]” from the “general constitutional language” of Article II’s Vesting Clause an unrestricted removal power constraining Congress’s ability to legislate under the Necessary and Proper Clause. It is still worse to extrapolate from the Constitution’s general structure (division of powers) and implicit values (liberty) a limit on Congress’s express power to create administrative bodies. By using abstract separation-of-powers arguments for such purposes, the Court “appropriate[s]” the “power delegated to Congress by the Necessary and Proper Clause” to compose the government. In deciding for itself what is “proper,” the Court goes beyond its own proper bounds…

Recall again how this dispute got started. In the midst of the Great Recession, Congress and the President came together to create an agency with an important mission… Not only Congress but also the President thought that the new agency, to fulfill its mandate, needed a measure of independence. So the two political branches, acting together, gave the CFPB Director the same job protection that innumerable other agency heads possess. All in all, those branches must have thought, they had done a good day’s work. Relying on their experience and knowledge of administration, they had built an agency in the way best suited to carry out its functions. They had protected the public from financial chicanery and crisis. They had governed.

And now consider how the dispute ends—with five unelected judges rejecting the result of that democratic process. The outcome today will not shut down the CFPB: A different majority of this Court, including all those who join this opinion, believes that if the agency’s removal provision is unconstitutional, it should be severed. But the majority on constitutionality jettisons a measure Congress and the President viewed as integral to the way the agency should operate. The majority does so even though the Constitution grants to Congress, acting with the President’s approval, the authority to create and shape administrative bodies. And even though those branches, as compared to courts, have far greater understanding of political control mechanisms and agency design.

Nothing in the Constitution requires that outcome; to the contrary. “While the Constitution diffuses power the better to secure liberty, it also contemplates that practice will integrate the dispersed powers into a workable government.” Youngstown Sheet & Tube Co. v. Sawyer (1952). The Framers took pains to craft a document that would allow the structures of govern- ance to change, as times and needs change. The Constitution says only a few words about administration… It authorizes Con- gress to meet new exigencies with new devices. So Article II does not generally prohibit independent agencies. Nor do any supposed structural principles. Nor do any odors waft- ing from the document. Save for when those agencies impede the President’s performance of his own constitutional duties, the matter is left up to Congress.

Our history has stayed true to the Framers’ vision. Congress has accepted their invitation to experiment with administrative forms—nowhere more so than in the field of financial regulation.  And this Court has mostly allowed it to do so. The result is a broad array of independent agencies, no two exactly alike but all with a measure of insulation from the President’s removal power. The Federal Reserve Board; the FTC; the SEC; maybe some you’ve never heard of. As to each, Congress thought that formal job protection for policymaking would produce regulatory outcomes in greater accord with the long-term public interest. Congress may have been right; or it may have been wrong;  or maybe it was some of both. No matter—the branches accountable to the people have decided how the people should be governed.

The CFPB should have joined the ranks.  Maybe it will still do so, even under today’s opinion: The majority tells Congress that it may “pursu[e] alternative responses” to the identified constitutional defect—“for example,  converting the CFPB into a multimember agency.” But there was no need to send Congress back to the drawing board. The Constitution does not distinguish between single-director and multimember independent agencies. It instructs Congress, not this Court, to decide on agency design. Because this Court ignores that sensible—indeed, that obvious—division of tasks, I respectfully dissent.