English v. Trump

Decision Date10 January 2018
Docket NumberCivil Action No. 17–2534 (TJK)
Citation279 F.Supp.3d 307
Parties Leandra ENGLISH, Plaintiff, v. Donald J. TRUMP, et al., Defendants.
CourtU.S. District Court — District of Columbia

Deepak Gupta, Daniel Townsend, Joshua Matz, Gupta Wessler PLLC, Washington, DC, Rachel S. Bloomekatz, Gupta Wessler PLLC, Columbus, OH, for Plaintiff.

Brett A. Shumate, Matthew Joseph Berns, Benjamin Thomas Takemoto, U.S. Department of Justice, Washington, DC, for Defendants.


TIMOTHY J. KELLY, United States District Judge

This case concerns whether the President is authorized to name an acting Director of the Consumer Financial Protection Bureau ("CFPB") or whether his choice must yield to the ascension of the Deputy Director, who was installed in that office by the outgoing Director in the hours before he resigned. The CFPB is a government agency created after the financial crisis of 20072008 by the Dodd–Frank Wall Street Reform and Consumer Protection Act (the "Dodd–Frank Act" or "Dodd–Frank"), Pub. L. No. 111–203, 124 Stat. 1376 (2010). The CFPB's previous Director, Richard Cordray, resigned effective at midnight on the day after Thanksgiving: Friday, November 24, 2017. That same day, he named Plaintiff Leandra English the CFPB's Deputy Director, in an apparent attempt to select his successor. But the President, Defendant Donald John Trump, made his own appointment that day, announcing that Defendant John Michael Mulvaney, who serves as the Director of the Office of Management and Budget ("OMB"), would also serve as acting Director of the CFPB upon Cordray's resignation.

English claims that, by operation of the Dodd–Frank Act, she—and only she—is now entitled to be the acting Director of the CFPB. She seeks a preliminary injunction that would restrain the President from appointing an acting Director other than her, require the President to withdraw Mulvaney's appointment, and prohibit Mulvaney from serving as acting Director. Defendants, joined by the CFPB's General Counsel, argue that the President's appointment of Mulvaney is valid under a separate statute, the Federal Vacancies Reform Act of 1998 (the "FVRA"), 5 U.S.C. §§ 3345 et seq. , which they contend provides the President an available method to fill Executive Branch vacancies such as this one. They urge the Court to deny the injunction.

The merits of this case turn on a question of statutory interpretation, where "[t]he ‘role of this Court is to apply the statute[s] as [they are] written—even if ... some other approach might accord with good policy.’ " Loving v. IRS , 742 F.3d 1013, 1022 (D.C. Cir. 2014) (quoting Burrage v. United States , ––– U.S. ––––, 134 S.Ct. 881, 892, 187 L.Ed.2d 715 (2014) ). Thus, the particular policies or priorities that English or Mulvaney might pursue as the CFPB's acting Director are irrelevant to the Court's analysis. For the reasons explained below, including that English has not demonstrated a likelihood of success on the merits or shown that she will suffer irreparable injury absent injunctive relief, her request for a preliminary injunction is DENIED .

I. Statutory Background
A. The Federal Vacancies Reform Act of 1998

"Article II of the Constitution requires that the President obtain ‘the Advice and Consent of the Senate’ before appointing ‘Officers of the United States.’ " NLRB v. SW Gen., Inc. , ––– U.S. ––––, 137 S.Ct. 929, 934, 197 L.Ed.2d 263 (2017) (quoting U.S. Const. art. II, § 2, cl. 2 ). "Given this provision, the responsibilities of an office requiring Presidential appointment and Senate confirmation—known as a ‘PAS’ office—may go unperformed if a vacancy arises and the President and Senate cannot promptly agree on a replacement." Id. "Congress has long accounted for this reality by authorizing the President to direct certain officials to temporarily carry out the duties of a vacant PAS office in an acting capacity, without Senate confirmation." Id.

In some cases, Congress has provided agency-specific rules for acting officers. See, e.g. , 12 U.S.C. § 4 (providing that the Deputy Comptrollers of the Currency shall perform the duties of the Comptroller during the latter's "vacancy," "absence," or "disability"). But since at least the 1860s, Congress has also provided general rules that apply to executive vacancies more broadly, across a wide range of government agencies. See SW Gen. , 137 S.Ct. at 935–36. Over the years, these authorizations have evolved, and have included default rules that allowed a PAS officer's "assistant" to take over her duties automatically, with provisions that also permitted the President to fill the vacancy with another person meeting certain qualifications, such as a person currently serving in a PAS office. See id.

The current iteration of Congress' general rule for acting officers is the FVRA, which was passed in part to address perceived threats to the Senate's advice and consent power that arose in the 1990s. See id. at 936. As such, the FVRA imposes carefully calibrated limits on who can be appointed as an acting PAS officer and how long they may serve. See 5 U.S.C. §§ 3345, 3346. Its default rule is that the officer's "first assistant" takes over as acting officer. Id. § 3345(a)(1). However, the President may override that rule by appointing a different officer or employee from within the same agency, see id. § 3345(a)(3), or a PAS officer from a different agency, see id. § 3345(a)(2). The FVRA generally forbids acting officers from serving for more than 210 days. See id. § 3346. In addition, with certain exceptions, a person may not serve as an acting officer if he has been nominated for the permanent position. See id. § 3345(b).

The FVRA generally covers any PAS office in any "Executive agency" in the event the officer "dies, resigns, or is otherwise unable to perform the functions and duties of the office." Id. § 3345(a). Certain offices are specifically excluded from the statute's scope, including members of any multi-member body that "governs an independent establishment or Government corporation."Id. § 3349c(1)(B). In addition, unless another statute expressly addresses the appointment of an acting officer, the FVRA provides that it is the "exclusive means" for any such appointments within its scope. Id. § 3347(a). If no one can serve as acting officer under the FVRA, the position remains vacant. Id. § 3348(b).

B. The Dodd–Frank Wall Street Reform and Consumer Protection Act

"In response to the financial crisis in 2008 ... Congress passed and President Obama signed the Dodd–Frank [Act]." State Nat'l Bank of Big Spring v. Lew , 795 F.3d 48, 51 (D.C. Cir. 2015). Title X of Dodd–Frank established the CFPB to "regulate the offering and provision of consumer financial products or services under the Federal consumer financial laws." CFPB v. Accrediting Council for Indep. Colls. & Schs. , 854 F.3d 683, 687 (D.C. Cir. 2017) (quoting 12 U.S.C. § 5491(a) ); see also 12 U.S.C. § 5492(a) (listing the CFPB's powers). The CFPB's purpose is to "implement and, where applicable, enforce Federal consumer financial law consistently for the purpose of ensuring that all consumers have access to markets for consumer financial products and services and that markets for consumer financial products and services are fair, transparent, and competitive." 12 U.S.C. § 5511(a). The "Federal consumer financial law" the CFPB is charged with enforcing "includes [Title X of Dodd–Frank] and eighteen pre-existing consumer protection statutes." Accrediting Council, 854 F.3d at 687 (citing 12 U.S.C. § 5481(12), (14) ). Dodd–Frank vested the CFPB with "broad ‘rulemaking, supervisory, investigatory, adjudicatory, and enforcement authority’ " to carry out its mission. Id. at 688 (quoting Morgan Drexen, Inc. v. CFPB , 785 F.3d 684, 687 (D.C. Cir. 2015) ).

The Dodd–Frank Act established the CFPB as an "independent bureau" within the Federal Reserve System. 12 U.S.C. § 5491(a). However, unlike many other independent agencies within the Executive Branch, it is led by a single Director. Id. § 5491(b)(1). The Director is appointed by the President with the advice and consent of the Senate, and may be removed only by the President for cause. Id. § 5491(b)(2), (c)(3).1 The Dodd–Frank Act establishes a five-year term for the Director. Id. § 5491(c)(1). The CFPB's structure is also marked by a number of other unusual features: for example, the CFPB receives funding from the Federal Reserve, as opposed to Congress. Id. § 5497(a). Moreover, other Executive Branch officers may not exercise control over the CFPB's communications with Congress about potential legislation. See id. § 5492(c)(4). The Dodd–Frank Act also created a Deputy Director of the CFPB, who "shall—(A) be appointed by the Director, and (B) serve as acting Director in the absence or unavailability of the Director." Id. § 5491(b)(5). In addition, Dodd–Frank provides that "[e]xcept as otherwise provided expressly by law, all Federal laws dealing with ... officers [or] employees ... apply to the exercise of the powers of the [CFPB]." Id. § 5491(a).

II. Factual and Procedural Background
A. Cordray's Resignation and the Dueling Appointments of English and Mulvaney

This controversy was set in motion on the day after Thanksgiving: Friday, November 24, 2017. That day, as consumers thronged the country's shopping malls, CFPB Director Cordray resigned from his position effective as of midnight, well short of the completion of his five-year term. See ECF No. 22 ("Am. Compl.") ¶¶ 11–12; ECF No. 24 ("English Decl.") ¶ 6. He also named English, his Chief of Staff, to serve as the CFPB's Deputy Director—a position that apparently no one had occupied since August 2015—effective at noon. See English Decl. ¶ 4; ECF No. 41–2 at 2 n.1. At 2:30 p.m., Cordray publicly announced the decision, explaining that the appointment was intended "to ensure an orderly succession for this independent agency" by effectively making English the acting Director after he left office. Eng...

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