Free Enterprise Fund v. Public Company Accounting Oversight Board

Free Enterprise Fund v. Public Company Accounting Oversight Board
Supreme Court of the United States
Argued December 7, 2009 Decided June 28, 2010
Full case name	Free Enterprise Fund and Beckstead and Watts, LLP v. Public Company Accounting Oversight Board, et al.
Docket no.	08-861
Citations	561 U.S. 477 (more) 130 S. Ct. 3138; 177 L. Ed. 2d 706
Case history
Prior	Judgment for defendants affirmed, 537 F.3d 667 (D.C. Cir. 2008), cert. granted, 556 U.S. 1234 (2009).
Holding
The dual for-cause limitations on the removal of members of the Public Company Accounting Oversight Board contravene the Constitution's separation of powers, but the unconstitutional limitations are severable from the remainder of the statute. The Board's appointment is consistent with the Appointments clause. Court of Appeals for the District of Columbia Circuit reversed in part, affirmed in part, and remanded.
Court membership
Chief Justice John Roberts Associate Justices John P. Stevens · Antonin Scalia Anthony Kennedy · Clarence Thomas Ruth Bader Ginsburg · Stephen Breyer Samuel Alito · Sonia Sotomayor
Case opinions
Majority	Roberts, joined by Scalia, Kennedy, Thomas, Alito
Dissent	Breyer, joined by Stevens, Ginsburg, Sotomayor
Laws applied
U.S. const., art. II

Free Enterprise Fund v. Public Company Accounting Oversight Board, 561 U.S. 477 (2010), was a 5–4 decision by the U.S. Supreme Court in which the Court ruled that laws enabling inferior officers of the United States to be insulated from the Presidential removal authority with two levels of "for cause" removal violated Article Two of the United States Constitution.^[1]

Under the Sarbanes–Oxley Act, PCAOB officers could be removed only "for good cause shown" by officers of the Securities and Exchange Commission (SEC). Officers of the SEC could only be removed by the President for "inefficiency, neglect of duty, or malfeasance in office." Thus, although the President could remove high-ranking members of the SEC, he could not govern and execute power to the board, thus providing a "dual layer" of protection. The Court found this "dual layer" of protection "contrary to Article II's vesting of the executive power in the President."