Rule of Law

Illumina, Inc. v. Federal Trade Commission

In Illumina, Inc. v. FTC, the United States Court of Appeals for the Fifth Circuit is considering whether the leadership structure of the Federal Trade Commission is constitutional.

Case Summary

Illumina, Inc., a genetic analysis developer, sought to buy another company that was working on a blood test for early stage cancer detection. The FTC initiated administrative proceedings to block the merger, concerned that it would hurt the development of a market for cancer testing. Ultimately, the Commission ruled that the merger violated federal antitrust law. Illumina then petitioned the Fifth Circuit to review this decision, arguing among other things that the FTC is unconstitutional because the president can remove its commissioners only for good cause, not at will. In August 2023, CAC filed an amicus curiae brief in support of the FTC.

Illumina argues that under the Supreme Court’s 2020 decision in Seila Law LLC v. CFPB, all agency leaders who wield substantial executive power must be removable at will by the president. Our brief showed why this is wrong.

We first demonstrate that Seila Law did not call into question the legitimacy of agencies structured like the FTC (sometimes referred to as multimember independent agencies). As we explain, Seila Law addressed only the new phenomenon of agencies led by a single director who is not removable at will. Based on three unique features of these single-director independent agencies, the Court concluded that they represent a novel intrusion on presidential authority that clashes with constitutional structure. The Court was clear, however, that it was not overruling its precedent upholding similar removal limits for the leaders of “a traditional independent agency, run by a multimember board.”

Our brief next explains why long-established practice has placed the validity of multimember independent agencies beyond doubt. In separation-of-powers cases, courts place significant weight upon historical practice, because it embodies the compromises and working arrangements that the elected branches of government themselves have reached. And Congress has been assigning regulatory authority to multimember independent agencies for a majority of the nation’s history, beginning nearly 150 years ago. Supreme Court decisions, including Seila Law, have consistently confirmed the validity of these traditional agencies.

Finally, we show that in addition to precedent and established practice, constitutional text and history further underscore the legitimacy of multimember independent agencies. The Constitution’s text does not address removal authority, and it gives Congress broad flexibility in determining how to shape the federal government. The early consensus that Article II of the Constitution gives presidents inherent removal authority was coupled with a recognition that legislation can limit this authority, and Congress began exercising that option in the nineteenth century. While the Supreme Court has struck down certain types of removal limits as intruding too far on presidential authority, it has always upheld good-cause tenure for the leaders of multimember agencies like the FTC.

In short, the FTC’s leadership structure is consistent with Supreme Court precedent, established practice, and the Constitution’s original meaning.

Case Timeline