SEC ALJ James Grimes Denies Request To Certify Discovery Ruling for Interlocutory Appeal

We reported several days ago that SEC administrative law judge James Grimes approved a subpoena to the SEC for materials relating to the allegations by former SEC ALJ Lillian McEwen that she was pressured as an ALJ to issue favorable rulings for the SEC staff.  See SEC ALJ James Grimes Issues Important Discovery Order Against SEC.  The SEC’s Office of General Counsel (OGC) was not pleased.  It asked ALJ Grimes to certify an interlocutory appeal to the Commission itself to challenge the discovery order.  On June 1, 2015, ALJ Grimes rejected that request for an interlocutory appeal.  His order can be read here: Order Denying Certification.

The OGC argued “that Mr. Hill’s request is “extraordinary,” and contrary to “the presumption that administrative law judges are unbiased.”  But the OGC did “not assert that Mr. Hill seeks irrelevant information.”  ALJ Grimes noted that “Mr. Hill has a due process right to an unbiased adjudicator and the media article to which he refers raises concerns about that right,” even though “the Office of the General Counsel is correct that administrative law judges are presumed to be unbiased.”  He also observed that “the conversation that is alleged in the media article must have occurred at least ten years ago — if it ever occurred at all,” and “Mr. Hill has done little to tie that alleged conversation to his proceeding.”  That’s not totally correct, since the person who allegedly pressured Ms. McEwen, Brenda Murray, is currently the Chief ALJ for the SEC — what additional connection could Mr. Hill supply without any discovery?

In any event, ALJ Grimes rejected the request because “[t]he initial opposition to Mr. Hill’s request, however, was based only on an argument that the request sought irrelevant information. The opposition made no mention of the arguments the Office of the General Counsel now raises. The Commission, however, has made clear that a litigant ‘may not rely upon . . . arguments’ not previously raised ‘as a basis for urging interlocutory review.’”  Because “the current basis for seeking interlocutory review was not previously raised, the request for certification is denied.”

ALJ Grimes did stay the obligation to comply with the subpoena until June 4, 2105, to allow the OGC “time to determine whether to seek interlocutory review absent certification.”

Straight Arrow

June 2, 2015

Contact Straight Arrow privately here, or leave a public comment below: