Seila Law LLC v. Consumer Financial Protection Bureau

[The line-up, part by part. This case has no single vote, and any one number would misdescribe it. Chief Justice Roberts delivered the opinion of the Court with respect to Parts I, II and III — the parts holding the CFPB’s structure unconstitutional — joined by Thomas, Alito, Gorsuch and Kavanaugh, JJ. That is five. He delivered an opinion with respect to Part IV — severability — joined only by Alito and Kavanaugh, JJ. That is three, a plurality, and the slip opinion’s running head changes accordingly from “Opinion of the Court” to “Opinion of ROBERTS, C. J.” Thomas, J., filed an opinion concurring in part and dissenting in part, joined by Gorsuch, J.: he joins Parts I, II and III and dissents from Part IV. Kagan, J., filed an opinion concurring in the judgment with respect to severability and dissenting in part, joined by Ginsburg, Breyer and Sotomayor, JJ. So the severability result commands a majority only by adding the three-Justice plurality to the four-Justice Kagan bloc. Every reproduced passage below is labelled with the opinion and part it comes from.]

[A note on citation. The case citation is settled — 591 U.S. 197 — confirmed against the Court’s own preliminary print, which carries final pagination, and cited in that form by Trump v. Slaughter itself. But this reading carries no page citation of any kind, not to this case and not to any authority the opinions cite, because the text below was taken from the slip opinion. The slip is separately paginated from page 1 in each of its four documents and prints the reporter page as a blank: “Cite as: 591 U. S. ____ (2020).” No slip-to-reporter mapping exists in that source — the typesetting differs, so there is no fixed offset — and none has been guessed, because a plausible-looking pin cite would be a false one. Rather than carry some pin cites and not others, this reading carries none, naming the opinion and part instead; cases are identified by name and year. The same convention is used for Biden v. Nebraska and in the Sheetz note. If you need a specific page in written work, pin it in the reporter, or in Westlaw or Lexis.]

[Omitted here: the Court’s Part II, rejecting three threshold arguments raised by the court-appointed amicus; most of the historical and structural elaboration in Part III–C; and much of the citation apparatus throughout.]

[The agency. In 2010, in the wake of the financial crisis, Congress created the Consumer Financial Protection Bureau in the Dodd-Frank Wall Street Reform and Consumer Protection Act as an independent financial regulator within the Federal Reserve System. It transferred to the CFPB the administration of eighteen existing federal consumer-protection statutes, added a new prohibition on “any unfair, deceptive, or abusive act or practice,” and authorized the agency to implement that standard through binding regulations. It gave the CFPB power to conduct investigations, issue civil investigative demands, initiate administrative adjudications, and prosecute civil actions in federal court, seeking restitution, disgorgement, injunctive relief and civil penalties. It funded the agency outside the appropriations process, through a draw on the Federal Reserve. And — departing from the multimember-board model that both Elizabeth Warren’s original proposal and the Treasury Department’s had contemplated — it placed the agency under a single Director, appointed for a five-year term and removable by the President only for “inefficiency, neglect of duty, or malfeasance in office.”]

[The posture. In 2017 the CFPB issued a civil investigative demand — essentially a subpoena — to Seila Law LLC, a California law firm providing debt-related legal services. Seila Law asked the agency to set the demand aside, objecting that leadership by a single Director removable only for cause violated the separation of powers. The CFPB declined to address the claim and, when Seila Law refused to comply, petitioned to enforce the demand in District Court. The District Court ordered compliance and the Ninth Circuit affirmed, holding itself bound by Humphrey’s Executor and Morrison. The Supreme Court granted certiorari and also asked for argument on severability. Because the Government agreed with Seila Law on the merits, the Court appointed Paul Clement to defend the judgment below as amicus curiae.]

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[Chief Justice Roberts, delivering the opinion of the Court with respect to Parts I, II and III. Introduction.]

In the wake of the 2008 financial crisis, Congress established the Consumer Financial Protection Bureau, 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 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.

Under our Constitution, the “executive Power” — all of it — is “vested in a President,” who must “take Care that the Laws be faithfully executed.” Art. II, § 1, cl. 1; id., § 3. Because no single person could fulfill that responsibility alone, the Framers expected that the President would rely on subordinate officers for assistance. Ten years ago, in Free Enterprise Fund v. Public Company Accounting Oversight Bd. (2010), we reiterated that, “as a general matter,” the Constitution gives the President “the authority to remove those who assist him in carrying out his duties.” “Without such power, the President could not be held fully accountable for discharging his own responsibilities; the buck would stop somewhere else.”

The President’s power to remove — and thus supervise — those who wield executive power on his behalf follows from the text of Article II, was settled by the First Congress, and was confirmed in the landmark decision Myers v. United States (1926). Our precedents have recognized only two exceptions to the President’s unrestricted removal power. In Humphrey’s Executor v. United States (1935), we held that Congress could create expert agencies led by a group of principal officers removable only for good cause. And in United States v. Perkins (1886) and Morrison v. Olson (1988), we held that Congress could provide tenure protections to certain inferior officers with narrowly defined duties.

We are now asked to extend these precedents to a new configuration: an independent agency that wields significant executive power and is run by a single individual who cannot be removed by the President unless certain statutory criteria are met. We decline to take that step. 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 structure of the CFPB violates the separation of powers. We go on to hold that the CFPB Director’s removal protection is severable from the other statutory provisions bearing on the CFPB’s authority. The agency may therefore continue to operate, but its Director, in light of our decision, must be removable by the President at will.

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[Opinion of the Court, Part III–A. The removal power and the two recognized exceptions. This is the passage that ties the module together.]

We 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.” Those 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. It “was discussed extensively in Congress when the first executive departments were created” in 1789, and the view that “prevailed, as most consonant to the text of the Constitution” was “that the executive power included a power to oversee executive officers through removal.” The First Congress’s recognition of that power “provides contemporaneous and weighty evidence of the Constitution’s meaning,” and has long been the “settled and well understood construction of the Constitution.”

The Court recognized the President’s prerogative to remove executive officials in Myers v. United States. Chief Justice Taft, writing for the Court, concluded after an exhaustive examination of the First Congress’s determination, the views of the Framers, historical practice and precedent 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.”

We recently reiterated the President’s general removal power in Free Enterprise Fund. Although we had previously sustained congressional limits on that power in certain circumstances, we declined to extend those limits to “a new situation not yet encountered by the Court” — an official insulated by two layers of for-cause removal protection. In the face of that novel impediment to the President’s oversight of the Executive Branch, we adhered to the general rule that the President possesses “the authority to remove those who assist him in carrying out his duties.”

Free Enterprise Fund 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.”

[A footnote at this point concedes the obvious: “The Court’s conclusion that the FTC did not exercise executive power has not withstood the test of time. As we observed in Morrison v. Olson, ‘[I]t is hard to dispute that the powers of the FTC at the time of Humphrey’s Executor would at the present time be considered “executive,” at least to some degree.’”]

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.”

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. Consistent with that understanding, the Court later applied “[t]he philosophy of Humphrey’s Executor” to uphold for-cause removal protections for the members of the War Claims Commission — a three-member “adjudicatory body” tasked with resolving claims for compensation arising from World War II. Wiener v. United States (1958).

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 Commissioners 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 two cases, United States v. Perkins and Morrison v. Olson. In Perkins, we upheld tenure protections for a naval cadet-engineer. And, in 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 concepts 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.”

[Opinion of the Court, Part III–B. Neither exception reaches this case.]

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, including a broad prohibition on unfair and deceptive practices in a major segment of the U. S. economy. And instead of submitting recommended dispositions to an Article III court, the Director may unilaterally issue final decisions awarding legal and equitable relief in administrative adjudications. Finally, 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 footnote to that sentence answers the dissent’s objection that the Court is reading Humphrey’s Executor more narrowly than the case reads itself: “The dissent would have us ignore the reasoning of Humphrey’s Executor and instead apply the decision only as part of a reimagined Humphrey’s*-through-*Morrison framework. But we take the decision on its own terms, not through gloss added by a later Court in dicta. The dissent also criticizes us for suggesting that the 1935 FTC may have had lesser responsibilities than the present FTC. Perhaps the FTC possessed broader rulemaking, enforcement, and adjudicatory powers than the Humphrey’s Court appreciated. Perhaps not. Either way, what matters is the set of powers the Court considered as the basis for its decision, not any latent powers that the agency may have had not alluded to by the Court.”]

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.

[Opinion of the Court, Part III–C. The refusal to extend.]

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.

[The Court works through the four: the Comptroller of the Currency, protected for one year during the Civil War, “adopted without discussion” and abandoned before it could be “tested by executive or judicial inquiry”; the Office of Special Counsel, single-headed since 1978, which drew a contemporaneous objection from the Office of Legal Counsel and a veto on constitutional grounds by President Reagan, and which does not bind private parties; the Social Security Administration, single-headed since 1994, whose structure President Clinton questioned on signing and which cannot bring enforcement actions against private parties; and the Federal Housing Finance Agency, created in 2008, which regulates primarily Government-sponsored enterprises and had recently been held unconstitutional by the Fifth Circuit en banc.]

With the exception of the one-year blip for the Comptroller of the Currency, these isolated examples are modern and contested. And they do not involve regulatory or enforcement authority remotely comparable to that exercised by the CFPB. The CFPB’s single-Director structure is an innovation with no foothold in history or tradition.

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. At the highest level, they “split the atom of sovereignty” itself into one Federal Government and the States; they then divided the “powers of the new Federal Government into three defined categories, Legislative, Executive, and Judicial”; and they bifurcated the federal legislative power into two Chambers.

[The Executive Branch, the Court continues, is “a stark departure from all this division.” The Framers viewed the legislative power as a special threat to liberty and so divided it; the Executive they thought it necessary to fortify, giving it the “[d]ecision, activity, secrecy, and dispatch” that “characterise the proceedings of one man.” To justify and check that authority they made the President “the most democratic and politically accountable official in Government” — the only official, with the Vice President, elected by the entire Nation.]

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. Through the President’s oversight, “the chain of dependence [is] preserved,” so that “the lowest officers, the middle grade, and the highest” all “depend, as they ought, on the President, and the President on the community.”

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, and 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 Court adds that other features aggravate the problem: the five-year term means some Presidents may never appoint a Director, and an incoming President may be “saddled with a holdover Director from a competing political party”; and the CFPB’s funding outside the appropriations process removes the budgetary tools Presidents ordinarily use to influence independent agencies, making it more likely that the agency will “slip from the Executive’s control, and thus from that of the people.”]

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[Chief Justice Roberts, joined by Justice Alito and Justice Kavanaugh — Part IV, a plurality opinion, not the opinion of the Court. Severability. The slip opinion’s running head changes here from “Opinion of the Court” to “Opinion of ROBERTS, C. J.” Abridged.]

Having concluded that the CFPB’s leadership by a single independent Director violates the separation of powers, we now turn to the appropriate remedy. We directed the parties to brief whether the Director’s removal protection was severable from the other provisions of the Dodd-Frank Act that establish the CFPB. If so, then the CFPB may continue to exist and operate notwithstanding Congress’s unconstitutional attempt to insulate its Director from removal.

[There is a live controversy on that question, the plurality explains, because the answer determines the disposition: if the removal restriction is not severable, the Court must reject the demand outright; if it is, the Court must remand for the Government to press its ratification argument.]

It has long been settled that “one section of a statute may be repugnant to the Constitution without rendering the whole act void.” “Generally speaking, when confronting a constitutional flaw in a statute, we try to limit the solution to the problem, severing any problematic portions while leaving the remainder intact.” Even in the absence of a severability clause, the “traditional” rule is that “the unconstitutional provision must be severed unless the statute created in its absence is legislation that Congress would not have enacted.”

[Here Dodd-Frank contains an express severability clause referring to “any provision of this Act,” which the plurality reads to apply across the whole statute, and it rejects petitioner’s surplusage argument based on a second, subtitle-specific clause.]

Finally, petitioner argues more broadly that Congress would not have wanted to give the President unbridled control over the CFPB’s vast authority. Petitioner highlights the references to the CFPB’s independence in the statutory text and legislative history, as well as in Professor Warren’s and the Obama administration’s original proposals.

These observations certainly confirm that Congress preferred an independent CFPB to a dependent one; but they shed little light on the critical question whether Congress would have preferred a dependent CFPB to no agency at all. That is the only question we have the authority to decide, and the answer seems clear. Petitioner assumes that, if we eliminate the CFPB, regulatory and enforcement authority over the statutes it administers would simply revert back to the handful of independent agencies previously responsible for them. But that shift would trigger a major regulatory disruption. One of those agencies no longer exists; the others do not have the staff or appropriations to absorb the CFPB’s operations; and none has the authority to administer Dodd-Frank’s new prohibition on unfair and deceptive practices. Given these consequences, it is far from evident that Congress would have preferred no CFPB to a CFPB led by a Director removable at will by the President.

JUSTICE THOMAS would have us junk our settled severability doctrine and start afresh, even though no party has asked us to do so. We think it clear that Congress would prefer that we use a scalpel rather than a bulldozer in curing the constitutional defect we identify today.

Our severability analysis does not foreclose Congress from pursuing alternative responses to the problem — for example, converting the CFPB into a multimember agency. The Court’s only instrument, however, is a blunt one. We have “the negative power to disregard an unconstitutional enactment,” but we cannot re-write Congress’s work by creating offices, terms, and the like. “[S]uch editorial freedom … belongs to the Legislature, not the Judiciary.”

Because we find the Director’s removal protection severable from the other provisions of Dodd-Frank that establish the CFPB, we remand for the Court of Appeals to consider whether the civil investigative demand was validly ratified.

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A decade ago, we declined to extend Congress’s authority to limit the President’s removal power to a new situation, never before confronted by the Court. We do the same today. While we have previously upheld 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.

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[Justice Thomas, with whom Justice Gorsuch joins, concurring in part and dissenting in part. He joins Parts I, II and III of the Chief Justice’s opinion and dissents from Part IV. Abridged.]

The Court’s decision today takes a restrained approach on the merits by limiting Humphrey’s Executor v. United States (1935), rather than overruling it. At the same time, the Court takes an aggressive approach on severability by severing a provision when it is not necessary to do so. I would do the opposite.

Because the Court takes a step in the right direction by limiting Humphrey’s Executor to “multimember expert agencies that do not wield substantial executive power,” I join Parts I, II, and III of its opinion. I respectfully dissent from the Court’s severability analysis, however, because I do not believe that we should address severability in this case.

[Part I. Overrule Humphrey’s Executor.]

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.

“The Constitution does not vest the Federal Government with an undifferentiated ‘governmental power.’” It sets out three branches and vests a different form of power in each. Article II vests “[t]he executive Power” in the President and directs that he shall “take Care that the Laws be faithfully executed.” Of course, the President cannot fulfill that role without assistance; he must “select those who [are] to act for him under his direction in the execution of the laws.” But “[t]he buck stops with the President,” and “[s]ince 1789, the Constitution has been understood to empower the President to keep [his] officers accountable — by removing them from office, if necessary.”

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.”

[Thomas then works through the founding-era evidence and the history of the removal power, and argues that Humphrey’s Executor departed from it without justification.]

Today’s decision constitutes the latest in a series of cases that have significantly undermined Humphrey’s Executor. First, in Morrison, the Court repudiated the reasoning of the decision. Then, in Free Enterprise Fund, we returned to the principles set out in the “landmark case of Myers.” And today, the Court rightfully limits it to “multimember expert agencies that do not wield substantial executive power.” After these decisions, the foundation for Humphrey’s Executor is not just shaky. It is nonexistent.

This Court’s repudiation of Humphrey’s Executor began with its decision in Morrison. There, the Court upheld a statute insulating an independent counsel from removal absent a showing of “good cause,” and in doing so set aside the reasoning of Humphrey’s Executor. It recognized that the earlier case “rel[ied] on the terms ‘quasi-legislative’ and ‘quasi-judicial’ to distinguish the officials involved in Humphrey’s Executor … from those in Myers.” But it then immediately stated that its “present considered view is that the determination of whether the Constitution allows Congress to impose a ‘good cause’-type restriction on the President’s power to remove an official cannot be made to turn on whether or not that official is classified as ‘purely executive.’” The Court also rejected Humphrey’s Executor’s conclusion that the FTC did not exercise executive power. The lone dissenter, Justice Scalia, disagreed with much of the Court’s analysis but noted that the Court had rightfully “swept” Humphrey’s Executor “into the dustbin of repudiated constitutional principles.” Thus, all nine Members of the Court in Morrison rejected the core rationale of Humphrey’s Executor.

The reasoning of Free Enterprise Fund created further tension (if not outright conflict) with Humphrey’s Executor. There the Court recognized that allowing officers to “execute the laws” beyond the President’s control “is contrary to Article II’s vesting of the executive power in the President,” acknowledged that “the executive power include[s] a power to oversee executive officers through removal,” and explained that without the power of removal the President cannot “be held fully accountable.” Humphrey’s Executor is at odds with every single one of these principles: It ignores Article II’s Vesting Clause, sidesteps the President’s removal power, and encourages the exercise of executive power by unaccountable officers. The reasoning of the two decisions simply cannot be reconciled.

Finally, today’s decision builds upon Morrison and Free Enterprise Fund, further eroding the foundation of Humphrey’s Executor. The Court correctly notes that “[t]he entire ‘executive Power’ belongs to the President alone,” and concludes that Humphrey’s Executor must be limited to “multimember expert agencies that do not wield substantial executive power.” And, at the same time, it recognizes that “[t]he Court’s conclusion that the FTC did not exercise executive power has not withstood the test of time.” In other words, Humphrey’s Executor does not even satisfy its own exception.

In light of these decisions, it is not clear what is left of Humphrey’s Executor’s rationale. But if any remnant of that decision is still standing, it certainly is not enough to justify the numerous, unaccountable independent agencies that currently exercise vast executive power outside the bounds of our constitutional structure.

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 unconstitutional agencies in place does not enhance this Court’s legitimacy; it subverts political accountability and threatens individual liberty. We simply cannot compromise when it comes to our Government’s structure. Today, the Court does enough to resolve this case, but in the future, we should reconsider Humphrey’s Executor in toto. And I hope that we will have the will to do so.

[Part II. Thomas would not reach severability at all. The judicial power, he argues, is “fundamentally, the power to render judgments in individual cases,” not a power to excise provisions from the statute books; the Court should decline to enforce the unconstitutional provision in the case before it and deny the CFPB’s petition.]

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[Justice Kagan, with whom Justice Ginsburg, Justice Breyer and Justice Sotomayor join, concurring in the judgment with respect to severability and dissenting in part. Edited at length. Note the posture: these four Justices reject the majority’s constitutional holding outright, but agree that if the removal provision is unconstitutional it should be severed — which is how the severability result got a majority.]

[Introduction.]

The majority’s explanation is that the heads of those agencies fall within an “exception” — one for multimember bodies and another for inferior officers — to a “general rule” of unrestricted presidential removal power, and that the CFPB Director does not. That account is wrong in every respect. The majority’s general rule does not exist. Its exceptions, likewise, are made up for the occasion — gerrymandered so the CFPB falls outside them. And the distinction doing most of the majority’s work — between multimember bodies and single directors — does not respond to the constitutional values at stake. If a removal provision violates the separation of powers, it is because the measure so deprives the President of control over an official as to impede his own constitutional functions. But with or without a for-cause removal provision, the President has at least as much control over an individual as over a commission — and possibly more. That means the constitutional concern is, if anything, ameliorated when the agency has a single head. Unwittingly, the majority shows why courts should stay their hand in these matters.

In second-guessing the political branches, the majority second-guesses as well the wisdom of the Framers and the judgment of history. It writes in rules to the Constitution that the drafters knew well enough not to put there. It repudiates the lessons of American experience, from the 18th century to the present day. And it commits the Nation to a static version of governance, incapable of responding to new conditions and challenges. Today’s decision wipes out a feature of the CFPB its creators thought fundamental to its mission — a measure of independence from political pressure. I respectfully dissent.

[Part I–A. The text.]

The text of the Constitution, the history of the country, the precedents of this Court, and the need for sound and adaptable governance — all stand against the majority’s opinion. They point not to a “general rule” of “unrestricted removal power” with two grudgingly applied “exceptions.” Rather, they bestow discretion on the legislature to structure administrative institutions as the times demand, so long as the President retains the ability to carry out his constitutional duties.

What does the Constitution say about the separation of powers — and particularly about the President’s removal authority? (Spoiler alert: about the latter, nothing at all.)

The majority offers the civics class version of separation of powers — call it the Schoolhouse Rock definition of the phrase. The Constitution’s first three articles, the majority recounts, “split the atom of sovereignty” among Congress, the President, and the courts, and by that mechanism the Framers provided a “simple” fix “to governmental power and its perils.” There is nothing wrong with that as a beginning (except the adjective “simple”). It is of course true that the Framers lodged three different kinds of power in three different entities, and that they did so for a crucial purpose — because, as Madison wrote, “there can be no liberty where the legislative and executive powers are united in the same person[] or body.”

The problem lies in treating the beginning as an ending too — in failing to recognize that the separation of powers is, by design, neither rigid nor complete. Blackstone, whose work influenced the Framers on this subject as on others, observed that “every branch” of government “supports and is supported, regulates and is regulated, by the rest.” So as James Madison stated, the creation of distinct branches “did not mean that these departments ought to have no partial agency in, or no controul over the acts of each other.” The drafters of the Constitution opted against keeping the branches “absolutely separate and distinct.” Instead, the branches have — as they must for the whole arrangement to work — “common link[s] of connexion [and] dependence.”

One way the Constitution reflects that vision is by giving Congress broad authority to establish and organize the Executive Branch. Article II presumes the existence of “Officer[s]” in “executive Departments.” But it does not, as you might think from reading the majority opinion, give the President authority to decide what kinds of officers — in what departments, with what responsibilities — the Executive Branch requires. Instead, Article I’s Necessary and Proper Clause puts those decisions in the legislature’s hands: Congress has the power to make all laws necessary and proper for carrying into execution not just its own enumerated powers but “all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.” Similarly, the Appointments Clause reflects Congress’s central role in structuring the Executive Branch. So as Madison told the first Congress, the legislature gets to “create[] the office, define[] the powers, [and] limit[] its duration.” The President, as to the construction of his own branch of government, can only try to work his will through the legislative process.

The majority relies for its contrary vision on Article II’s Vesting Clause, but the provision can’t carry all that weight. Or as Chief Justice Rehnquist wrote of a similar claim in Morrison v. Olson, “extrapolat[ing]” an unrestricted removal power from such “general constitutional language” — which says only that “[t]he executive Power shall be vested in a President” — is “more than the text will bear.” The Necessary and Proper Clause makes it impossible to “establish a constitutional violation simply by showing that Congress has constrained the way ‘[t]he executive Power’ is implemented”; that is exactly what the Clause gives Congress the power to do. Only “a specific historical understanding” can bar Congress from enacting a given constraint, and nothing of that sort broadly prevents Congress from limiting removal. Note two points about practice before the drafting. First, in that era Parliament often restricted the King’s power to remove royal officers — and the President, needless to say, wasn’t supposed to be a king. Second, many States allowed limits on gubernatorial removal power even though their constitutions had similar vesting clauses.

Nor can the Take Care Clause come to the majority’s rescue. That Clause cannot properly serve as a “placeholder for broad judicial judgments” about presidential control. To begin with, the provision — “he shall take Care that the Laws be faithfully executed” — speaks of duty, not power. And more important, its text requires only enough authority to make sure “the laws [are] faithfully executed” — meaning with fidelity to the law itself, not to every presidential policy preference. As this Court has held, a President can ensure “‘faithful execution’ of the laws” with a removal provision like the one here. A for-cause standard gives him “ample authority to assure that [an official] is competently performing [his] statutory responsibilities in a manner that comports with the [relevant legislation’s] provisions.”

Finally, recall the Constitution’s telltale silence: Nowhere does the text say anything about the President’s power to remove subordinate officials at will. The majority professes unconcern. After all, it says, “neither is there a ‘separation of powers clause’ or a ‘federalism clause.’” But those concepts are carved into the Constitution’s text — the former in its first three articles separating powers, the latter in its enumeration of federal powers and its reservation of all else to the States. And anyway, at-will removal is hardly such a “foundational doctrine[]”: You won’t find it on a civics class syllabus. That’s because removal is a tool — one means among many, even if sometimes an important one, for a President to control executive officials. To find that authority hidden in the Constitution as a “general rule” is to discover what is nowhere there.

[Part I–B. The history.]

History no better serves the majority’s cause. As Madison wrote, “a regular course of practice” can “liquidate & settle the meaning of” disputed or indeterminate constitutional provisions. The majority lays claim to that kind of record, asserting that its muscular view of “[t]he President’s removal power has long been confirmed by history.” But that is not so. The early history — including the fabled Decision of 1789 — shows mostly debate and division about removal authority.

[Kagan works through the Decision of 1789 and the long practice of insulating financial regulators in particular, arguing that Congress has experimented continuously with administrative form and that this Court has, until now, allowed it. Part I–C reads the precedents, Humphrey’s Executor through Morrison and Free Enterprise Fund, as establishing not two rigid categories but a single functional question: whether a removal restriction so deprives the President of control as to impede his own constitutional functions.]

[Part II–A. The CFPB is nothing unusual.]

Applying our longstanding precedent, the answer is clear: it does not violate the Constitution. This Court has sustained the constitutionality of the FTC and similar independent 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. There is nothing different here. The CFPB’s powers are nothing unusual in the universe of independent agencies: it can issue regulations, conduct its own adjudications, and bring civil enforcement actions backed by penalties — but then again, so too can the FTC and the SEC, two agencies whose regulatory missions parallel the CFPB’s. Just for a comparison, the CFPB now has 19 enforcement actions pending, while the SEC brought 862 such actions last year alone. No less than those other entities — by now part of the fabric of government — the CFPB is a permissible exercise of Congress’s power under the Necessary and Proper Clause to structure administration.

[Part II–B. The single-Director distinction.]

The majority focuses on one (it says sufficient) reason: The CFPB Director is singular, not plural. “Instead of placing the agency under the leadership of a board with multiple members,” the majority protests, “Congress provided that the CFPB would be led by a single Director.” 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.

I’m tempted at this point just to say: No. All I’ve explained about constitutional text, history, and precedent invalidates the majority’s thesis. But I’ll set out here some more targeted points, taking step by step the majority’s reasoning.

First, as I’m afraid you’ve heard before, the majority’s “exceptions” (like its general rule) are made up. Our precedents reject the very idea of such exceptions. “The analysis contained in our removal cases,” Morrison stated, shuns any attempt “to define rigid categories” of officials who may (or may not) have job protection. Still more, the contours of the majority’s exceptions don’t connect to our decisions’ reasoning. The analysis in Morrison extended far beyond inferior officers — and of course it had to apply to individual officers: the independent counsel was very much a person, not a committee. 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. So if the majority really wants to see something “novel,” it need only look to its opinion.

By contrast, 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. The Social Security Administration. The Federal Housing Finance Agency. Maybe four prior agencies is in the eye of the beholder, but it’s hardly nothing.

[Kagan then argues that the singular/plural line does not track presidential control at all. Removal is only one of many control mechanisms, whose operation depends 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.” The category of “multimember commission” itself “breaks apart under inspection”: chairs, partisan-balance requirements, term length and voting rules all vary widely.]

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 accountability 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. “[M]ultiple membership,” an influential Senate Report concluded, is “a buffer against Presidential control.” 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: 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 colleagues 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.

[Part III. The close.]

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. 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 — 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) (Jackson, J., concurring). The Framers took pains to craft a document that would allow the structures of governance to change, as times and needs change. As Chief Justice Marshall wrote: Rather than prescribing “immutable rules,” it enables Congress to choose “the means by which government should, in all future time, execute its powers.” So Article II does not generally prohibit independent agencies. Nor do any supposed structural principles. Nor do any odors wafting 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. 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” — “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.

Notes & Questions

1. Big picture — the case that reduced a century of doctrine to two exceptions, and set up its own overruling. Seila Law holds that the Consumer Financial Protection Bureau’s structure — a single Director, exercising substantial executive power, removable by the President only for inefficiency, neglect of duty or malfeasance — violates the separation of powers. The reasoning is the important part. Roberts begins from a general rule of unrestricted presidential removal and then says the Court has recognized only two exceptions: Humphrey’s Executor, for multimember expert bodies that do not exercise substantial executive power, and Morrison together with United States v. Perkins, for inferior officers with limited duties and no policymaking or administrative authority. Both readings are in this module, and both are described far more narrowly here than they described themselves. Humphrey’s Executor thought it was announcing a principle about the nature of administrative bodies; Seila Law treats it as a decision about the 1935 Federal Trade Commission, an agency the opinion says no longer resembles the one before that Court. Once a precedent has been reduced to its facts, overruling it is a short step, and on June 29, 2026 the Court took it: Trump v. Slaughter, No. 25-332, 609 U. S. ___ (2026), the current case for this module, overruled Humphrey’s Executor outright. Read this case as the hinge. Everything the majority does here is preparation, and Justice Kagan says so at the time.

2. Raw specific knowledge — the parts, the two exceptions, and the remedy. (a) Learn the part-by-part line-up, which the reading labels throughout. The removal holding is the opinion of the Court; the severability holding in Part IV is a plurality of three. Anyone who states this case as a single vote has misdescribed it, and the same discipline applies here that applied to NFIB in Module 4. (b) State the general rule and the two exceptions in the Court’s own terms, and be able to say exactly how each exception is characterized — the Humphrey’s Executor exception as covering a multimember body of experts, balanced along partisan lines, serving staggered terms, and not wielding substantial executive power; the Morrison/Perkins exception as covering inferior officers with limited duties. (c) State the distinguishing feature the Court relies on: a single Director, accountable to no colleagues, heading an agency with substantial rulemaking, enforcement and adjudicative power, insulated further by a funding stream outside the ordinary appropriations process. (d) State the remedy: the removal restriction is severable, so the Bureau survives and its Director serves at the President’s pleasure. Note how much of the practical stakes that holding removes, and ask whether a Court willing to sever is a Court taking its own constitutional conclusion seriously. (e) A citation convention specific to this reading: the case cite is 591 U.S. 197, but the body carries no page numbers, because the text comes from the slip opinion rather than the reporter. Cite by opinion and part from this reading, and pin to the reporter if you need a page in written work. The same rule applies to Biden v. Nebraska in Module 5. Keep the two questions separate — whether a case has an official citation, and whether the text in front of you carries the pagination to pin a quotation to.

3. Practical application — sort the agencies by the test, and watch the test dissolve. Apply Seila Law as written — not Slaughter — to each of the following, and say which exception, if any, saves it: (a) the Federal Housing Finance Agency, a single-Director agency with for-cause protection (this is Collins v. Yellen, a note in this module — check your answer against it); (b) the Social Security Administration, a single Commissioner with for-cause protection administering a benefits program; (c) the Federal Trade Commission as it operated in 2020; (d) the Federal Reserve Board; (e) an administrative law judge inside the Securities and Exchange Commission (compare Lucia, also a note here); (f) the Office of Special Counsel. Then the diagnostic question: how many of these turn on the single-Director feature, and how many turn on whether the agency exercises substantial executive power? You will find the second variable doing nearly all the work and the first doing almost none — which is precisely the ground on which Slaughter later abandoned the framework. Finally, draft the statute: restructure the CFPB, in one sentence, so that it survives this decision. Then ask whether your fix survives Slaughter, and if not, whether any independent consumer-protection agency can.

4. Attack the reasoning — Kagan’s dissent, which reads now like a prediction. Her argument has three parts and you should be able to give each. (a) Text. The Constitution says nothing about removal. It specifies how officers are appointed and says nothing at all about how they leave, and a rule of unrestricted presidential removal is therefore an inference from the Vesting Clause rather than a command of the document. If the text is silent, she argues, the question is one for Congress, which is expressly empowered to structure the government by necessary and proper legislation. (b) History and practice. Congress has created officers with tenure protection since the early Republic, and the practice has been long, varied and largely unchallenged. This is Frankfurter’s Youngstown gloss argument, in this module’s other corner — notice that the same interpretive move is available to whichever side happens to be defending the status quo, and ask whether that tells you something about the move. (c) The distinction is arbitrary. Why should a single Director be constitutionally worse than five Commissioners with identical powers? If the concern is presidential control, a multimember body is harder to control, not easier. If the concern is accountability, a single head is more identifiable, not less. Make the majority’s best answer — it exists, and it runs through the idea that a lone officer with no colleagues to check him is a novel concentration of power outside the President’s control — and then say whether it survives Kagan’s objection. (d) Now the reason this note matters more than an ordinary dissent note: her objection was vindicated in the least comforting possible way. The single-Director line proved unworkable, and the Court’s response in 2026 was not to abandon the line in favour of Congress’s authority, as she urged, but to abandon the exceptions altogether. Is that a point against her argument or against the majority’s? Argue both.

5. Creative thinking — what a decision does to the precedent it distinguishes. (a) The narrowing move. This case does not overrule Humphrey’s Executor; it describes it, and the description leaves almost nothing standing. Find the sentences that do that work. Then generalize: what is the difference between narrowing a precedent and overruling it without saying so, and does it matter for stare decisis that the Court preserved the name? Justice Thomas, concurring in part with Gorsuch, would have overruled it openly, and his stated reason is candour. Is open overruling more respectful of precedent than silent narrowing, or less? (b) Write the opinion the Court did not write. Draft, in two paragraphs, a Seila Law majority that upholds the CFPB’s structure while still deciding something — that is, that supplies a limit on congressional insulation without adopting the single-Director test. You may not simply defer to Congress; you must say where the line is. If you find you cannot state one, you have arrived at Scalia’s objection to Morrison from the opposite direction, and the module has closed a circle. (c) Then look forward. After Slaughter, the general rule is presidential removal and the surviving exception is a carve-out for the Federal Reserve grounded in history and tradition — a carve-out Justice Thomas declined to join. Ask what happens the first time a President removes a Governor of the Federal Reserve. Then ask the question that should worry you either way: a constitutional rule with exactly one exception, and that exception justified by the practical consequences of not having it, is either a rule with a principled boundary or a policy judgment wearing a rule’s clothes. Which is it here, and how would you tell?