On January 15, 2025, in a case brought by a John Doe plaintiff challenging the PCAOB’s disciplinary powers, Chief Judge William Campell, Jr. of the District Court for the Middle District of Tennessee issued a decision granting the PCAOB’s motion to transfer the lawsuit to the District Court for the District of Columbia.  The case is Doe v. Pub. Co. Acct’g Oversight Bd., No. 3:24-cv-254 (M.D. Tenn.).  In transferring the matter, the court agreed with the PCAOB that it would be inefficient to litigate the same constitutional issues in matters in different districts. (Two other factually unrelated matters raising similar legal issues are currently pending in the District Court for the District of Colombia, including a matter filed on January 10, 2025, John Doe Corp. v. Pub. Co. Acct’g Oversight Bd., 1:25-cv-070 and a matter filed in 2023, Doe v. Pub. Co. Acct’g Oversight Bd., 1:24-cv-780. These matters are separate from the John Doe lawsuit that was mooted and the subject of a report in last week’s Auditor Liability Bulletin.)

The anonymous plaintiff in the case is a certified public accountant in Tennessee, who alleges that the PCAOB commenced disciplinary proceedings against him in September 2023, when he was a partner of a registered public accounting firm.  The plaintiff argues that: (1) the PCAOB adjudication process usurps judicial power under Article III of the Constitution; (2) PCAOB members, prosecution staff, and the Chief Hearing Officer (“CHO”) are private parties wielding law enforcement powers without government supervision in violation of Article II; (3) the CHO is an inferior officer unlawfully appointed and protected from removal in violation of Article II of the Constitution; (4) the PCAOB disciplinary process deprives defendants of jury trial and due process rights; and (5) the PCAOB’s prosecution is funded by money spent in violation of the Appropriations, Taxing, and Spending Clauses of Article I of the Constitution. 

A copy of the Order can be found here.