## Facts

- The Department of Agriculture initiated administrative enforcement proceedings to revoke or suspend the registration of Arthur Economou’s commodity futures commission company for alleged financial noncompliance.
- The administrative effort ultimately failed after review, and Economou then sued individual Department officials for damages in federal court.
- Economou alleged the officials instituted and pursued unauthorized, baseless proceedings and thereby violated his constitutional rights, including due process, allegedly with malice and improper motives.
- The district court dismissed, holding the officials had absolute immunity for discretionary acts within the scope of their authority.
- The Second Circuit reversed, holding the officials were entitled only to qualified immunity similar to state officials sued under 42 U.S.C. § 1983.
- The Supreme Court granted certiorari to determine the proper immunity standards for federal officials in constitutional damages actions and whether certain administrative roles warrant absolute immunity.

## Issues

1. Whether federal executive officials sued for damages directly under the Constitution are entitled to absolute immunity, or instead only qualified immunity comparable to § 1983 defendants.
2. Whether officials performing adjudicatory or prosecutorial functions in federal administrative proceedings are entitled to absolute immunity for those functions.

## Decision

- The Court held that, as a general rule, federal executive officials sued for constitutional violations are entitled only to qualified immunity, absent exceptional circumstances requiring absolute immunity.
- The Court rejected a categorical rule of absolute immunity for all discretionary conduct by federal officials.
- The Court affirmed immunity parity: federal officials sued directly under the Constitution should not receive broader immunity than state officials sued under § 1983.
- The Court recognized absolute immunity for specific functions within administrative adjudication:
  - Administrative law judges (hearing examiners) for acts within their adjudicative role.
  - Agency officials performing prosecutorial functions (e.g., initiating and presenting enforcement cases) for those prosecutorial acts.
- The case was to proceed under a functional analysis on remand to determine which defendants, for which acts, qualified for absolute versus qualified immunity.

## Legal Principles

- In constitutional damages actions against federal officials, qualified immunity is the default protection for discretionary conduct, unless absolute immunity is shown to be essential to public functions.
- Immunity analysis is functional: the level of immunity depends on the nature of the function performed, not the official’s title or place in government.
- Qualified immunity protects officials who act in good faith with objectively reasonable grounds, including for reasonable mistakes of law or fact; liability may attach where an official knows or should know the conduct is unlawful.
- Absolute immunity applies to roles functionally comparable to judges and prosecutors, including agency adjudicators and agency prosecutors in administrative enforcement proceedings, to prevent intimidation and harassment that could distort decision-making.

## Conclusion

The Court established that federal officials sued for constitutional tort damages generally receive qualified immunity comparable to § 1983 standards, while granting absolute immunity to administrative adjudicators and agency prosecutors for acts closely tied to judicial and prosecutorial functions within agency adjudications.


Butz v. Economou, 438 U.S. 478 (1978)