Aurelius Investment, LLC v. Puerto Rico

Questions presented

SCOTUS records, cert granted 20 Jun 2019

A panel of the United States Court of Appeals for the First Circuit unanimously held that all seven voting members of the Financial Oversight and Management Board for Puerto Rico, a federal entity that manages Puerto Rico's financial affairs and prosecutes its historic bankruptcy, have occupied their offices in violation of the Appointments Clause of the United States Constitution since 2016. Nevertheless, the First Circuit applied the so-called "de facto officer doctrine" to uphold all of the Board's actions prior to the First Circuit's decision, as well as the Board's actions for 150 days after the First Circuit's judgment. The question presented is: Does the de facto officer doctrine allow courts to deny meaningful relief to successful separation-of-powers challengers who are suffering ongoing injury at the hands of unconstitutionally appointed principal officers?

Opinion summary

Etalia.ai summary of the majority opinion

The case addressed the constitutionality of the appointment process for members of the Financial Oversight and Management Board for Puerto Rico, established under the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). Aurelius Investment challenged that board members were appointed in violation of the Appointments Clause because they were not confirmed by the Senate. The Supreme Court ruled that although these appointments did not follow constitutional requirements typically applicable to federal officers due to their significant authority over local matters in Puerto Rico, Congress had acted within its powers under Article IV's Territorial Clause. This clause allows Congress greater leeway when legislating for territories than it has with states. Thus, while acknowledging some concerns about accountability and oversight given PROMESA’s broad powers over fiscal policy decisions affecting millions of residents without direct democratic input from them or their elected representatives on this specific issue at hand regarding how those overseeing such policies are chosen directly impacting governance structures themselves being subject only indirectly through congressional action rather than more traditional checks balances mechanisms found elsewhere across broader governmental systems nationwide.