Cornyn, Coons Bill to Apply STOCK Act Requirements to Federal Judges Heads to President’s Desk


In: All News   Posted 04/27/2022
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Bill Followed Wall Street Journal Report on Judges Neglecting Financial Disclosure Requirements, Avoiding Potential Conflicts of Interest

WASHINGTON – U.S. Senators John Cornyn (R-TX) and Chris Coons (D-DE) released the following statements after the House of Representatives passed their Courthouse Ethics and Transparency Act, which would require online publication of financial disclosure reports for federal judges and mandate they submit periodic transaction reports for certain securities transactions:

“One of the bedrocks of American democracy is our independent judiciary, and it is imperative that federal judges are held to the same standard of transparency as other federal officials under the STOCK Act,” said Sen. Cornyn. “This legislation will help bring potential conflicts of interest to light and bolster public trust in our judicial system, and I’m glad it is on its way to the President’s desk.” 

“I’m proud to see the bipartisan Courthouse Ethics and Transparency Act pass the House and head to the President’s desk for signature. This law will help protect our legal system from conflicts of interest by increasing transparency around federal judges’ financial interests. It’s an important step toward ensuring equal justice under the law. I thank Senator Cornyn and Reps. Ross and Issa for their partnership in moving this legislation across the finish line, and I look forward to seeing President Biden sign it into law,” said Sen. Coons.

The legislation is cosponsored by Senate Judiciary Committee Chairman Dick Durbin (D-IL) and Ranking Member Chuck Grassley (R-IA) and Senators John Kennedy (R-LA), Sheldon Whitehouse (D-RI), Ted Cruz (R-TX), and Jon Ossoff (D-GA).

Background:

The Courthouse Ethics and Transparency Act would require that federal judges’ financial disclosure reports be made publicly available online and require federal judges to submit periodic transaction reports of securities transactions in line with other federal officials under the STOCK Act. The bill, which passed the Senate unanimously in February, would amend the Ethics in Government Act of 1978 to:

  • Require the Administrative Office of the U.S. Courts to create a searchable online database of judicial financial disclosure forms and post those forms within 90 days of being filed, and
  • Subject federal judges to the STOCK Act’s requirement of filing periodic transaction reports within 45 days of securities transactions over $1,000.

Importantly, the bill also preserves the existing ability of judges to request redactions of personal information on financial disclosure reports due to a security concern.

Under current ethics guidelines and federal law, federal judges are prohibited from hearing cases that involve a party in which they, their spouse, or their minor children have a financial interest. Federal judges are instead supposed to disqualify themselves in any proceeding in which their impartiality may be questioned. Despite this, a recent report from the Wall Street Journal found that between 2010 and 2018, more than 130 federal judges failed to recuse themselves in nearly 700 cases in which they or an immediate family member held stock in a company involved in the case.

While federal judges are required to submit financial disclosure reports, current law does not provide sufficient transparency or certainty for litigants to discern if the judge has a conflict of interest. The current process for obtaining judicial financial disclosure forms can be cumbersome and take months or even years. By contrast, financial disclosure reports for the President, Members of Congress, and Presidential-appointed and Senate-confirmed officials are readily available online.

Litigants need real-time access to judges’ financial disclosures and securities transactions in order to preserve the integrity of the proceedings and ensure a recusal when there’s a potential conflict of interest in their case. The Courthouse Ethics and Transparency Act would enact necessary updates to disclosure rules and provide litigants and the public with greater confidence in the judicial system.