Judge Rules for Trump Administration in CFPB Showdown

By the C|C Whistleblower Lawyer Team

Yesterday, U.S. District Judge Timothy J. Kelly rejected a request for a temporary restraining order that would block Mick Mulvaney from serving as acting director of the Consumer Financial Protector Bureau (“CFPB”).  The motion stemmed from a complaint filed in the U.S. District Court for the District of Columbia by Leandra English, the second-in-command at the CFPB, seeking to block Mr. Mulvaney so that she could assume the position of acting director.

The dispute arose last Friday after both the outgoing Director of the CFPB, Richard Cordray, and President Trump named acting directors for the agency.  Before President Trump appointed Mr. Mulvaney, Mr. Cordray promoted Ms. Engligh, his chief of staff, to deputy director of the CFPB and then named her acting secretary until the Senate confirmed a replacement.  Mr. Mulvaney has previously commented that the CFPB is a “joke.”

The dispute centers on a provision in the Dodd-Frank Act that states that the deputy director will “serve as acting director in the absence or unavailability of the director.”  Ms. English contends that the statute requires her appointment regardless of the administration’s attempt to install Mr. Mulvaney.  Judge Kelly disagreed, finding that the Vacancies Reform Act gives the president authority to appoint an acting director despite the mandated succession provided in Dodd-Frank.  Judge Kelly also noted that the case raises constitutional issues regarding the president’s power of appointment.

Despite the ruling, Ms. English’s attorney, Deepak Gupta, made clear that the case is far from over.  “What we want is a quick, speedy resolution of this controversy that can get up through the court system and could be appealed because this court—I think this court understands—is not the final word on who is the director of the Consumer Financial Protection Bureau,” he told reporters.