## Facts

- Adrian Antoniu, an investment banker, participated in an insider-trading scheme from 1972–1978 by obtaining material nonpublic takeover information and sharing it with a trader who profited by purchasing target-company stock.
- In 1980, Antoniu pleaded guilty to federal securities fraud offenses under § 10(b) and Rule 10b-5; his ultimate sentence included unsupervised probation and a fine.
- In 1984, Antoniu sought to work for a registered broker-dealer; because of his conviction, his association required self-regulatory approval.
- In June 1985, the NASD approved Antoniu’s association, but the SEC exercised statutory authority to veto that approval (a proceeding referred to as *Antoniu I*), with Commissioner Charles C. Cox participating.
- Shortly thereafter, the SEC instituted a separate proceeding to determine whether Antoniu should be permanently barred from association with any broker or dealer based on the conviction (referred to as *Antoniu II*).
- While *Antoniu II* was pending, Commissioner Cox gave a public speech that referenced Antoniu, criticized him, and described the permanent bar as if already decided.
- Antoniu sought to develop the record regarding bias and moved to disqualify Cox; those requests were denied, and Cox continued participating, including in rejecting a proposed settlement.
- Cox formally recused himself only on the day the SEC issued the final order permanently barring Antoniu, after which Antoniu petitioned for judicial review.

## Issues

1. Whether due process is violated when an agency adjudicator publicly prejudges a pending case and then continues to participate in the agency’s decision-making.
2. Whether an adjudicator’s late recusal cures earlier participation that created an impermissible appearance of bias.
3. What remedy is required when an agency adjudication is tainted by prejudgment and the resulting appearance of unfairness.

## Decision

- The Eighth Circuit vacated the SEC’s relevant orders, including the permanent bar imposed in *Antoniu II* and related portions of *Antoniu I* affected by Cox’s participation.
- The court held that Cox’s extra-record public comments reflected impermissible prejudgment of a matter still pending before the Commission.
- The court held that Cox’s continued participation after the speech denied Antoniu an impartial adjudication and compromised the appearance of justice.
- The court rejected the SEC’s argument that Cox’s recusal on the day of decision cured the defect because he had already participated in key stages.
- The court remanded for a de novo determination by the SEC without Cox’s participation.

## Legal Principles

- Due process requires a fair tribunal in administrative adjudication, including the absence of both actual bias and an appearance of unfairness.
- Public, extra-record statements by an agency decision-maker that indicate a closed mind on the merits of a pending case constitute impermissible prejudgment.
- When a decision-maker who has publicly prejudged a case continues to participate in deliberations or procedural decisions, the proceeding is tainted even without proof of actual animus.
- A belated recusal does not retroactively remove the taint created by earlier participation after prejudgment.
- The appropriate remedy for adjudicative taint of this kind is vacatur and remand for de novo proceedings before an untainted decision-making body.

## Conclusion

The court set aside the SEC’s bar orders because a commissioner’s public comments treated a pending sanction as already decided and he continued to participate in the matter, creating an impermissible appearance of prejudgment that required a new, unbiased adjudication.


Antoniu v. Sec. & Exch. Comm’n, 877 F.2d 721 (8th Cir. 1989)