Key Points

  • D.C. Circuit affirms injunction barring ITC from pursuing sanctions against expert witness Sidak based on a 2017 protective order issued by an unconstitutionally appointed ALJ
  • Court holds Sidak's suit was neither too early (it presented purely legal Appointments Clause questions requiring no further factual development) nor too late (as a non-party witness, he had no earlier obligation or forum to raise the claim)
  • Panel confines the de facto officer doctrine to minor technical appointment defects, not structural constitutional violations, and finds no abuse of discretion in the permanent injunction under the eBay factors
  • Decision suggests other agencies' unratified pre-Lucia ALJ actions and expert-witness sanctions practices may face similar Appointments Clause challenges

The D.C. Circuit has affirmed a district court's permanent injunction barring the International Trade Commission from investigating or sanctioning expert witness J. Gregory Sidak for allegedly violating a protective order that an unconstitutionally appointed administrative law judge issued in 2017.

The case traces back to the Supreme Court's 2018 decision in Lucia v. SEC, which held that ALJs are 'inferior Officers' under the Appointments Clause who must be appointed by the President, the courts, or an agency's head, not by staff or a single official. At the ITC, that means all six commissioners acting collectively, not the chairman alone. In anticipation of Lucia, the ITC ratified its chairman's past ALJ appointments, but it did not ratify the ALJs' past actions, including a 2017 protective order issued in a dispute between Qualcomm and Apple.

Sidak testified as an expert witness in that case and agreed to abide by the order, which required recipients of confidential business information to return or destroy it once the case ended. Years later, the ITC suspected Sidak had not complied and opened an investigation, exchanging letters over nine months and directing him to submit sworn affidavits addressing responsibility and potential sanctions, warning that a failure to respond could lead to adverse inferences. Sidak sued, arguing the underlying protective order was void because the ALJ who issued it had not been properly appointed and the order had never been ratified.

The panel, Circuit Judges Katsas, Rao, and Walker, with Judge Walker writing, rejected the ITC's threshold arguments that the suit was both premature and untimely. On ripeness, the court found the case presented 'purely legal' questions about timeliness, forfeiture, and enforceability that required no further factual development, and that Sidak faced hardship from an enforcement proceeding he claims is illegitimate while the ITC had no institutional interest favoring delay.

The court also rejected the ITC's finality argument, noting that because Sidak relied on an implied constitutional right of action in equity under Free Enterprise Fund v. PCAOB rather than a statutory cause of action, no finality requirement applied.

On timeliness, the ITC argued Sidak forfeited his Appointments Clause claim by testifying in the original proceeding and signing the protective order without objection. The court distinguished this from cases where a party invokes an agency forum and seeks a ruling, only to demand a do-over after losing.

"agreeing to testify is materially different from invoking a forum and affirmatively seeking a ruling from the Commission"

The panel emphasized that its holding was narrow, stressing that it did not open the door for parties to belatedly attack adverse orders based on an adjudicator's authority generally. The court noted that the ITC's timeliness and forfeiture arguments 'would fare much better if Sidak were a party' to the original proceeding, but he was a third-party witness with no obligation or opportunity to raise the claim earlier in federal court.

The court also rejected the ITC's argument that the de facto officer doctrine should validate the protective order, noting that doctrine has been confined to minor technical defects in title to office rather than structural constitutional violations, and that it protects reliance interests for parties who already litigated before a questionably appointed official, not non-parties later targeted by enforcement.

On remedy, the panel found no abuse of discretion in the district court's grant of a permanent injunction under the eBay factors, noting the ITC had not preserved arguments about irreparable injury below and observing that the agency could have ratified the Qualcomm-Apple protective order after Lucia, as other agencies did and as the Solicitor General had advised.

"If any broader reliance interests are affected in this case, the Commission is to blame."

The decision leaves open questions for other agencies with similarly unratified pre-Lucia ALJ actions, and signals that expert witnesses and other non-parties bound by administrative protective orders may have a viable path to challenge enforcement actions grounded in constitutionally defective appointments, even years after the underlying proceeding closed.