United States v. Arthrex, this summer’s much-anticipated Supreme Court decision which concluded that the Patent and Trademark Appeal Board (PTAB) is unconstitutionally structured, is unlikely to have a major impact on PTAB operations. The Court “fixed” the constitutional violation by adding an extra step to the administrative review process, thereby permitting PTAB for the most part to continue business as usual.

But Arthrex will have a significant and largely overlooked impact on constitutional law: it has sub silentio overruled Morrison v. Olson, the highly controversial 1988 decision that upheld the constitutionality of the 1978 Ethics in Government Act (aka the Independent Counsel Act). Morrison rejected an Appointments Clause challenge to the Act on the ground that independent counsel were mere “inferior officers” of the United States. Arthrex repudiated Morrison’s framework for distinguishing “inferior officers” from “principal officers” and thereby made clear that the Independent Counsel Act (which expired in the 1990s and was never re-enacted) could not withstand constitutional scrutiny if adopted again.

The appointment of an independent counsel to investigate wrongdoing by senior Executive Branch officials has long been highly controversial. Politicians alternatively support or oppose such appointments depending on whether their party is in power. Democrats loved independent counsel during the Reagan-Bush Administrations and again during investigations of whether President Trump colluded with Russian interference with the 2016 election, but hated independent-counsel investigations during the Clinton Administration. Republicans’ love-hate relationship with independent counsel was precisely reversed. Although the Independent Counsel Act expired more than 30 years ago, Morrison v. Olsen has stood as a stark reminder that Congress has had constitutional authority to re-enact the law at any time.

The Appointments Clause

Congress adopted the Independent Counsel Act in 1978 in the wake of Watergate. The Act created a new court that was authorized to appoint an “independent counsel” to investigate and, if appropriate, prosecute certain high-ranking federal officials for violating federal criminal law. It authorized counsel to exercise all functions of the Justice Department. Only the Attorney General could remove the independent counsel from office, and only for “good cause.”

The Act’s appointment mechanism was in considerable tension with Article II’s Appointments Clause. That constitutional provision sets out the methods for appointing federal officials, with the methods varying depending on the official’s importance within the government. The Appointments Clause provides, on the one hand, that principal officers of the United States may be appointed only by means of presidential nomination with the advice and consent of the Senate. On the other hand, Congress may provide for appointment of “inferior” officers by the President, “Heads of Departments,” or federal courts. Because the Act provided for appointment of independent counsel by a federal court (a collection of judges drawn from the U.S. Court of Appeals for the District of Columbia Circuit), it violated the Appointments Clause unless independent counsel qualified as inferior officers.

The Morrison Decision

Morrison was a challenge to the Act’s constitutionality, brought by the targets of one of the nine independent counsel investigations undertaken in the first decade following the Act’s adoption. The principal target, Theodore Olson, served as a senior Justice Department official during the Reagan Administration. Congressional Democrats accused Olson of misleading the House Judiciary Committee while the committee was seeking access to certain EPA documents. (Olson later served as Solicitor General during the George W. Bush Administration.)

In an 8-1 decision, the Supreme Court rejected the challenge to the Act, holding that independent counsel were “inferior” officers and thus properly appointed by federal courts. The Court cited four factors as relevant to its inferior-officer finding. First, the independent counsel was “subject to removal by a higher Executive Branch official,” i.e., she could be removed for cause by the Attorney General. Second, she was “empowered by the Act to perform only certain limited duties.” Third, her office was “limited in jurisdiction”—she could only investigate and prosecute the single federal official identified by the federal court. Finally, her tenure was limited—her commission would cease as soon as she completed her investigation of that official.

Justice Scalia, dissenting from the finding that the independent counsel was an inferior officer, discounted each of those four factors. He noted that the independent counsel’s for-cause tenure protection rendered her far less easily removable than senior Executive Branch officials, such as cabinet members, who were indisputably principal officers. Scalia concluded that she was a principal officer because the Act did not permit others within the Executive Branch to countermand her orders; she possessed “full power and independent authority to exercise all investigative and prosecutorial functions of the Department of Justice.” (emphasis in original.)

Arthrex Sides with the Scalia Dissent

June’s Arthrex decision did not mention Morrison by name. But its analysis of the Appointments Clause leaves no doubt that it sided with the Scalia dissent, not with Chief Justice Rehnquist’s majority opinion—thereby overruling Morrison sub silentio.

At issue in Arthrex was whether Congress violated Article II when it granted the PTAB’s Administrative Patent Judges (APJ) unreviewable authority to decide challenges to the validity of existing patents—despite the fact that APJs are appointed by the Secretary of Commerce, not by the President with the Senate’s advice and consent. The Court held that the statutory structure violated the Appointments Clause because APJs were exercising authority reserved for principal officers.

In distinguishing between the two categories of federal officers, the Court never mentioned the four factors relied on by Morrison; indeed, it never even cited Morrison. Instead, the Court held that any federal officials whose decisions are not reviewable by a principal officer within the Executive Branch are themselves principal officers, and “[o]nly an officer properly appointed to a principal office may issue a final decision binding the Executive Branch. ”That holding precisely matches Scalia’s reasoning.

Nothing remains left of Morrison’s holding. A separate portion of that opinion rejected a separation-of-powers challenge to the Independent Counsel Act’s tenure-protection provision. But two recent Court decisions (Seila Law LLC v. CFPB and Collins v. Yellin) have held that such provisions improperly interfere with the President’s authority to direct the Executive Branch when applied to principal officers outside the context of multi-member independent agencies, and thereby violate Article II’s separation-of-powers requirements. Because, as Arthrex makes clear, independent counsel would now be classified as principal officers, Morrison’s separation-of-powers holding is also overruled.

Arthrex jettisoned Morrison with very little fanfare. Perhaps Chief Justice Roberts, who clerked for then-Associate Justice Rehnquist (Morrison’s author) during the Court’s 1980 Term, does not want to take a victory lap. But Arthrex’s reasoning demonstrates that Morrison has received a well-deserved burial and is unlikely to be relied on by the Court in future decisions.

Significantly, Morrison’s demise means that there will never again be an “independent counsel” of the sort hated by the President’s party and loved by the opposing party. While a President will always be free to appoint a prosecutor to investigate alleged Executive Branch misconduct who is “independent” in the sense that he or she operates outside normal Justice Department channels, the President will retain the right to fire the prosecutor at will. And that is how it should be. The separation-of-powers principles embedded in the Constitution dictate that the President is entitled to control Executive Branch activity. Congress properly exerts its authority by exercising its legislative and impeachment powers, not by creating Executive Branch offices that are not subject to the President’s control.