Federal Judge Rules in Favor of Trump Administration on Question of CFPB Leadership


11/29/2017 2:54:00 AM

After a swift decision, Trump appointee Mick Mulvaney will assume role as acting director.

NewsCFPB

A judge in the U.S. District Court for the District of Columbia has ruled against Consumer Financial Protection Bureau Deputy Director Leandra English in a lawsuit she initiated over the weekend concerning the leadership of the bureau.

Before vacating his office, former CFPB Director Richard Cordray elevated English to the leadership role of deputy director and interim leader of the bureau. Meanwhile, President Trump appointed Mick Mulvaney to the same position. Mulvaney currently serves as Trump’s director of the Office of Budget and Management—a role he intends to maintain along with the CFPB interim responsibilities.

English responded to the action with a lawsuit, English v. Trump, et. al, seeking a temporary restraining order against the Trump administration. The court held a hearing Nov. 27 and took the parties’ arguments under advisement followed by a second hearing Nov. 28 at which time Judge Timothy Kelly issued his ruling from the bench.

The court’s decision means Mulvaney, who already implemented a 30-day moratorium on regulations at the CFPB and a hiring freeze, will remain for now the acting director of the bureau.

According to a report from The New York Times,  “Judge Kelly, who was nominated by Mr. Trump and confirmed in September, said that he had not been convinced by the argument that the language in the Dodd-Frank Act (the law that created the CFPB, and specified that the deputy director fill in for the chief) superseded that in  the Vacancies Reform Act (the law that gives the president the authority to fill jobs). ‘On its face,’ he said, ‘V.R.A. does appear to apply in this situation.’”   

The Hill reports Mulvaney will serve as the acting director until a permanent leader is selected and confirmed by the U.S. Senate or English appeals  the case and is successful. CNN reported that “[o]utside of the courtroom Tuesday, English’s attorney told reporters he and his client have options to consider: ‘We could file a preliminary injunction, or we could file an appeal or we could file a motion to end this case and take it straight to DC circuit court.  This judge does not have the final decision.’”

Before the hearing Nov. 27, current and former members of Congress filed a motion for leave to file an amici curiae (“friend of the court”) brief in support of English and her request for a temporary restraining order.  The court granted the motion on Nov. 28 for good cause shown. 

According to the amici brief, “As members of Congress who were involved in the drafting and enactment of Dodd-Frank … amici are particularly well positioned to explain Congress’s statutory plan for the CFPB, the independence the Bureau was meant to exercise, and how those purposes would be undermined by allowing presidents to hand-pick an acting Director of the Bureau when a vacancy arises,” ACA International previously reported.

Before the second hearing held in the case on Nov 28, attorneys general for the states of Texas, West Virginia, Alabama, Arkansas, Georgia, Louisiana, Oklahoma, and South Carolina moved for leave to file their own “friend of the court” brief in support of Mulvaney and the Trump administration. 

ACA International will continue to provide updates on this developing story for its readers and members.

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