CFTC v. Schor
Citation and Court
478 U.S. 833 (1986), Supreme Court of the United States
Facts
Schor filed a reparations claim against his commodity broker with the Commodity Futures Trading Commission (CFTC). The broker counterclaimed for a common law debt. Schor voluntarily submitted to CFTC adjudication of both claims. After losing on the counterclaim, Schor argued the CFTC lacked Article III authority to adjudicate the state-law counterclaim.
Issue
Whether Article III permits Congress to vest a non-Article III agency (the CFTC) with authority to adjudicate state-law counterclaims arising in proceedings before the agency.
Holding
CFTC adjudication of Schor’s state-law counterclaim is constitutional; a functionalist analysis weighing the extent of the intrusion on Article III courts, the parties’ consent, and the limited scope of the agency’s jurisdiction counsels in favor of upholding the arrangement.
Rule / Doctrine
Article III adjudicative authority may be shared with non-Article III tribunals when: (1) the parties have consented, (2) the non-Article III court’s jurisdiction is limited and adjunct to a broader regulatory scheme, (3) the matter is closely related to a federal regulatory program, and (4) the intrusion on the Article III judicial role is minimal.
Significance
CFTC v. Schor represents the Court’s functionalist approach to Article III limits on agency adjudication, contrasting with the more formalist approach in Northern Pipeline. It is a key case for understanding how far Congress can go in vesting adjudicative power in non-Article III tribunals, particularly when parties voluntarily submit to agency jurisdiction.