A Competitive Enterprise Institute paper (cowritten by Hans Bader and John Berlau) argues that part of Sarbanes-Oxley violates the Appointments Clause ("[The President] shall nominate, and by and with the Advice and Consent of the Senate, shall appoint . . . [all] Officers of the United States . . .: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments."):

The Sarbanes-Oxley Act of 2002 created a powerful quasi-private agency to oversee the auditing of American business, the Public Company Accounting Oversight Board (PCAOB). . . . Congress gave the power to appoint the members of the PCAOB not to the President, but to the five members of the Securities and Exchange Commission. This method of appointment violates the Appointments Clause in numerous ways. The Appointments Clause gives only the President the power to appoint the nation's principal officers, and allows low-ranking officers to be picked only by the President, a court, or by a single head of a cabinet-level department. The five commissioners of the SEC, as a group, don't fall under any of these categories.

Above all, the authors conclude, the Appointments Clause violation creates a lack of accountability for rules that hurt businesses and don't help investors. They note that England's abuses with offices spawning more offices led the Constitution's Framers to take great care to ensure that the power to appoint was limited to the very top officials of the Executive Branch. . . .

I know a bit about the Appointments Clause, but I'm no expert on the subject; and I know nothing about Sarbanes-Oxley. My sense is that the main questions would be (1) whether the PCAOB members are "inferior officers," and (2) whether the SEC board qualifies as a "head of department." (The notion of plural agency heads is familiar in modern legalese, though it might have been outside the contemplation of the Framers, who I suspect neither anticipated independent administrative agencies nor even non-independent departments who would be run by a board rather than by an individual.) The test for question 1, I believe, is whether the appointee "exercis[es] significant authority pursuant to the laws of the United States," and to answer that one would need to know both the precise powers of the Board, and the caselaw defining what's "significant."

Nonetheless, despite my massive gaps in knowledge here, my colorability antennae (or would it be colorability cones?) are giving me positive signals here -- whether or not it's a winning argument, it seems at least a plausible and interesting one. I'd love to hear what people think about, but please comment only if you're knowledgeable about the Appointments Clause caselaw, about the nature of the PCAOB, or about both. For the purposes of this discussion, I'm much interested not in what the structure of our government or of our accounting industry should be (so no arguments, please, that the SEC is just plain unconstitutional from the get-go), but rather in whether the PCAOB appointments method is indeed unconstitutional under current law.