• Free Enterprise Fund v. Public Company Accounting Oversight Board: "Dual For-Cause" Removal Struck Down; PCAOB Operations Upheld
  • August 16, 2010
  • Law Firm: Fried Frank Harris Shriver Jacobson LLP - New York Office
  • In its final decision of the past term, Free Enterprise Fund v. Public Company Accounting Oversight Board, a 5-4 majority of the Supreme Court held that limits in the Sarbanes-Oxley Act of 2002 (the "Act") on the ability to remove members of the Public Company Accounting Oversight Board (the "PCAOB" or "Board") violated separation of powers under the Constitution. Having found the removal provisions unconstitutional, however, the Court declined to strike down the PCAOB’s existence or otherwise disturb the Act. Instead, in its narrowly crafted decision, the Court opined that, with the removal provisions excised from the Act, the PCAOB’s structure is consistent with the Constitution and the Act remains fully operative.