The United States Supreme Court heard oral arguments in Financial Oversight and Management Board for Puerto Rico v. Aurelius Investment LLC, a case arguing that the appointment of members to the Financial Oversight and Management Board for Puerto Rico violated the Appointments Clause of the U.S. Constitution.
The Appointments Clause provides the president with the authority to appoint officers of the United States, subject to confirmation by the U.S. Senate. These positions include ambassadors, heads of Cabinet-level departments, and federal judges. Congress vests the authority to appoint inferior officers, such as federal attorneys and administrative law judges, in the president, the courts, or heads of departments.
Congress created the Financial Oversight and Management Board in 2016 and authorized the board to begin debt adjustment proceedings on behalf of the Puerto Rico government. The seven-member board is made up of one member chosen at the president’s discretion and six other members selected by the president from a list compiled by members of Congress. The appointees selected from the congressional list are not subject to Senate confirmation.
Aurelius Investment LLC and the Unión de Trabajadores de la Industria Eléctrica y Riego challenged the board’s authority in federal district court, arguing the board members’ appointments were not in compliance with the Appointments Clause. Aurelius and the union claimed that the board members are “Officers of the United States” who must all be nominated by the president and confirmed by the Senate. The board argued that its activities are primarily local in nature and, therefore, its members do not qualify as “Officers of the United States.”
The court’s decision in the case could determine whether certain territorial officers can also be classified as federal officers for purposes of the Appointments Clause.