Client Alert: Supreme Court’s Axon Decision Opens the Door for Collateral Attacks on Agency Enforcement Actions
Executive Summary
In Axon Enterprises, Inc. v. FTC (April 14, 2023), the Supreme Court unanimously held that respondents in FTC and SEC administrative actions can file separate lawsuits in federal court to challenge the constitutionality of the agencies and thereby enjoin the agency proceedings. Although the Court did not decide whether the SEC and FTC are unconstitutionally structured, its decision opens the door to such challenges in the future. Companies and individuals that are the target of administrative enforcement actions or other proceedings should therefore consider making these types of challenges in federal court as part of their defensive strategy.
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