What's Happening?
Several federal multimember regulatory agencies in the U.S. are operating with significant vacancies, raising concerns about their ability to function legally. Agencies like the Commodity Futures Trading Commission, the Federal Trade Commission, and the National
Credit Union Administration are operating with only a fraction of their seats filled. Despite these vacancies, these agencies continue to act, supported by the argument that the absence of explicit statutory quorum requirements allows remaining officials to proceed. However, legal experts are urging litigators to challenge these actions, citing potential violations of common law quorum rules. These rules, historically applied by courts, require a simple majority of the total number of positions, including vacant seats, to constitute a quorum. The U.S. Supreme Court has previously endorsed these common law rules, but lower courts have shown divergence in their application.
Why It's Important?
The functioning of federal agencies with significant vacancies poses a risk to the integrity of regulatory processes. If agencies act without a proper quorum, their decisions could be legally challenged, potentially leading to a backlog of cases and regulatory uncertainty. This situation could impact industries regulated by these agencies, as decisions made without a quorum might be overturned, causing disruptions. Moreover, the divergence in court rulings on quorum requirements highlights a need for clearer legislative guidelines to ensure consistent application of the law. The outcome of these legal challenges could set important precedents for how federal agencies operate in the face of vacancies, affecting their ability to enforce regulations and protect public interests.
What's Next?
Litigators are expected to increasingly include quorum violations in their legal challenges against agency actions. This could lead to a reevaluation of the common law rules by higher courts, potentially resulting in new legal standards for agency operations. Congress may also be prompted to clarify statutory quorum requirements to prevent future ambiguities. Agencies might need to adjust their internal rules to align with any new legal interpretations, ensuring their actions remain within legal bounds. The resolution of these challenges will be closely watched by industries and legal experts, as it could influence the future of regulatory governance in the U.S.
