In a second victory for the White House over the battle for control of the Consumer Financial Protection Bureau, a federal judge denied a preliminary injunction request that would have removed Acting Director Mick Mulvaney from his post.
On Wednesday, Judge Timothy Kelly dropped a 46-page opinion denying Deputy Director Leandra English’s request to be installed as acting director of the CFPB to temporarily succeed Richard Cordray after he left the office in November. President Donald Trump selected Mulvaney as the acting director last year citing the Federal Vacancies Reform Act and sparking a debate over which legal precedent determines the regulator’s line of succession.
Kelly has ruled twice now that the Federal Vacancies Reform Act supersedes the succession plan laid out in the Dodd-Frank Act. English’s lawyer, Deepak Gupta, has not officially said they will appeal. However, Gupta previously said, “I think everyone understands this court is not the final stop, this judge does not have the final word on what happens in this controversy.”
Barring another appeal, Mulvaney will continue to lead the auto finance industry’s chief watchdog until a permanent successor is named.
Given that this is one of the first major transitions of power for the young agency, these rulings will help inform how the process will happen in the future.
Gupta argued that the president’s appointment violates the independence of the agency.
“The law is clear: President Trump may not circumvent the Senate confirmation process by installing his White House budget director to run the CFPB part time,” Gupta said on Twitter. “Mr. Mulvaney’s appointment undermines the bureau’s independence and threatens its mission to protect American consumers.”
However, Judge Kelly’s opinion rejects that notion saying that the agency is still financially and structurally independent from Congress. Arguments regarding which legal precedent is correct — the Federal Vacancies Act or the Dodd-Frank Act — were more nuanced and are likely to continue to be a subject of debate.
“The administration is glad to see the courts once again recognize the president’s lawful designation,” said Raj Shah, principal deputy White House press secretary. “The president looks forward to acting director Mulvaney’s continued work on behalf of American consumers.”Like This Post