At Global Investigations and Compliance Review, we’ve been keeping close tabs on the fallout from the Supreme Court decisions at the end of June. We mentioned in a previous post that the SEC v. Jarkesy opinion may have consequences beyond the specific situation of SEC civil penalties. As we think about this more, there could be further implications even for state enforcement programs. 

State agencies usually aren’t concerned with the Seventh Amendment, because it is assumed not to apply to states. (The Seventh Amendment states the right to a jury in appropriate civil cases.) But contributor Keith Bradley points out, in the Yale Journal of Regulation’s Notice and Comment blog, that this assumption has not been well-tested, because states provide civil juries just like federal courts. Jarkesy creates an unusual moment with the federal constitutional right being different from state constitutions. We might start to see defendants in state enforcement argue that they have right to a jury under Jarkesy. This will take some time to develop, but keep an eye out.