Nat'l Ass'n of Consumer Advocates v. Uejio
| Decision Date | 25 February 2021 |
| Docket Number | Civil Action No. 20-11141-JCB |
| Court | U.S. District Court — District of Massachusetts |
| Parties | NATIONAL ASSOCIATION OF CONSUMER ADVOCATES, et al., Plaintiffs, v. Dave UEJIO, in his official capacity as Acting Director of the Consumer Financial Protection Bureau, et al., Defendants. |
John T. Lewis, III, Pro Hac Vice, Kristen Miller, Pro Hac Vice, Sean Lev, Pro Hac Vice, Democracy Forward Foundation, Washington, DC, Michael Landis, Pro Hac Vice, U.S. Public Interest Research Group, Denver, CO, David A. Nicholas, David A. Nicholas, Esq., Newton, MA, for Plaintiffs.
Christopher Deal, Consumer Financial Protection Bureau, Washington, DC, Lawrence DeMille-Wagman, United States Court of Appeals, Boston, MA, for Defendants.
Boal, M.J.
In this action, plaintiffs National Association of Consumer Advocates ("NACA"), U.S. Public Interest Research Group ("U.S. PIRG"), and Professor Kathleen Engel (collectively, the "Plaintiffs") challenge the Consumer Financial Protection Bureau's Federal Consumer Financial Law Taskforce under the Federal Advisory Committee Act. Defendants have moved to dismiss the Complaint's First and Fourth Claims for Relief as well as the first, second, third, and fifth elements of Plaintiffs’ Prayer for Relief for lack of standing pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. Docket No. 19. In addition, the Defendants argue that the Court lacks jurisdiction with respect to those claims as well as the Second Claim for Relief, because they have been rendered moot by the release of the Taskforce's report on January 5, 2021 and the subsequent resignation of all the members of the Taskforce. Docket No. 40. For the following reasons, I deny the Defendants’ motion to dismiss and find that the case is not moot.
Plaintiffs filed their complaint on June 16, 2020. Docket No. 1. On August 17, 2020, Defendants filed the instant motion to dismiss. Docket No. 19. Plaintiffs filed an opposition on September 14, 2020. Docket No. 23. Defendants filed a reply on September 29, 2020. Docket No. 26. On October 5, 2020, the Plaintiffs filed a notice of supplemental authority. Docket No. 29. I heard oral argument on January 6, 2021.
After the January 6, 2021 hearing, the parties submitted briefs addressing whether any part of the case became moot due to the release of the Taskforce's report. Docket Nos. 39, 40.
The government has a statutory duty to ensure transparency and a balanced membership in forming advisory committees. The Federal Advisory Committee Act ("FACA"), enacted in 1972, was "born of a desire to assess the need for the ‘numerous committees, boards, commissions, councils, and similar groups which have been established to advise officers and agencies in the executive branch of the Federal Government.’ " Pub. Citizen v. Dep't of Justice, 491 U.S. 440, 445-446, 109 S.Ct. 2558, 105 L.Ed.2d 377 (1989) (quoting 5 U.S.C. app. 2 § 2(a) ). One of FACA's purposes is to "provide uniform standards for the creation, operation, and management of [advisory] committees." Union of Concerned Scientists v. Wheeler, 954 F.3d 11, 16 (1st Cir. 2020) (quoting S. Rep. No. 92-1098, at 1 (1972)). FACA followed on the heels of a disclosure that an agency, without statutory authority, had established a close liaison with an advisory council composed entirely of business officials from each of the major industries but not consumer, labor, or small business representatives. Id.
To achieve its ends, FACA imposes several requirements on advisory committees. Unless "specifically authorized by statute or by the President," an advisory committee cannot be established without an agency head "determin[ing] as a matter of formal record" that the committee is "in the public interest in connection with the performance of duties imposed on that agency by law." 5 U.S.C. App. 2 § 9(a)(2). In addition, an advisory committee subject to FACA cannot meet until a "charter has been filed" with the head of the agency to which it reports and with the House and Senate committees having legislative jurisdiction over that agency. 5 U.S.C. App. 2 § 9(c). The charter must also be filed with the Committee Management Secretariat of the General Services Administration ("GSA"). 41 C.F.R. § 102-3.70(a)(3)-(4). Each committee also must have a "designated [ ] officer or employee of the Federal Government to chair or attend each meeting." 5 U.S.C. App. 2 § 10(e). The designated federal officer serves as the primary contact for members of the public who seek more information about the advisory committee's meetings and hearings.
41 C.F.R. § 102-3.150(a)(5). Moreover, advisory committees must give notice of any meetings in the Federal Register at least fifteen days before the meeting is held. 5 U.S.C. App 2 § 10(a)(2) ; 41 C.F.R. § 102-3.150(a). Meetings must be open to the public, 5 U.S.C. App. 2 § 10(a)(1), and each committee must make its records and drafts publicly available. Id. § 10(b) - (c).
In addition, FACA requires a committee's implementing legislation to "require the membership of [any] advisory committee to be fairly balanced in terms of the points of view represented and the functions to be performed by the advisory committee." 5 U.S.C. App. 2 § 5(b)(2). It also requires that such legislation "contain appropriate provisions to assure that the [committee's] advice and recommendations ... will not be inappropriately influenced by the appointing authority or by any special interest, but will instead be the result of the advisory committee's independent judgment." Id. § 5(b)(3). Agency heads "shall" follow these guidelines in creating an advisory committee. Id. § 5(c).
FACA contains no private right of action. The Administrative Procedure Act ("APA"), however, provides a vehicle for review of agency decisions taken allegedly in violation of federal law. Union of Concerned Scientists, 954 F.3d at 17.
In 2010, in the wake of the 2008 financial crisis, Congress created the Consumer Financial Protection Bureau (the "Bureau") as an independent financial regulator within the Federal Reserve System. Seila Law LLC v. Consumer Financial Protection Bureau, ––– U.S. ––––, 140 S. Ct. 2183, 2193, 207 L.Ed.2d 494 (2020) (citing Dodd-Frank Wall Street Reform and Consumer Protection Act, 124 Stat. 1376). "Congress tasked the [Bureau] with ‘implement[ing]’ and ‘enforc[ing]’ a large body of financial consumer protection laws to ‘ensur[e] that all consumers have access to markets for consumer financial products and services and that markets for consumers financial products and services are fair, transparent, and competitive.’ " Id. (citing 12 U.S.C. § 5511(a) ).
On October 11, 2019, the Bureau announced the establishment of the Federal Consumer Financial Law Taskforce (the "Taskforce"). Complaint ¶ 80. Its charter states that the Taskforce is to:
(1) examine the existing legal and regulatory environment facing consumers and financial service providers; and (2) report its recommendations for ways to improve and strengthen consumer financial laws and regulations, including recommendations for resolving conflicting requirements or inconsistencies, reducing unwarranted regulatory burdens in light of market or technological developments, improving consumer understanding of markets and products, and identifying gaps in knowledge that should be addressed through future Bureau research.
Id. at ¶ 81 (). The Charter also directs the Taskforce to deliver its findings to the Director of the Bureau "in the form of one consensus final report," "no later than January 2021." Id. at ¶ 82. The Taskforce will "operate until the final report is delivered." Id.; see also Charter at ¶ 10. The Charter expires 90 days after the final report is delivered, unless renewed by appropriate action. Charter at ¶ 10.
Under the Charter, the Taskforce reported to the Bureau's Director at the time, Kathleen Kraninger, who was to appoint as Staff Director a full-time Bureau employee to "ensure that the Taskforce operates in accordance with the terms of the charter[.]" Id. at ¶ 83. Bureau employee Matt Cameron had been assigned as the Taskforce's Staff Director. Id.
Under the Charter's terms, the Director of the Bureau "shall select the members of the Taskforce." Id. at ¶ 84. The Bureau selected five individuals to serve on the Taskforce: Todd Zywicki, Howard Beales, Thomas Durkin, William MacLeod, and Jean Noonan. Id. at ¶¶ 103, 108, 111, 113, 114. According to the Plaintiffs, the Taskforce's members exclusively represent deregulatory and industry views, while excluding the views of consumer advocates. See generally Complaint at ¶¶ 103-114.
NACA is a non-profit association of more than 1,500 attorneys and consumer advocates committed to representing consumer interests. Complaint ¶ 9. NACA's members include private and public sector attorneys, legal services attorneys, law professors, and law students. Id. NACA's core mission is to advocate for the interests of consumers and for policies that protect consumers against predatory financial institutions. Id.
To accomplish its mission, NACA engages in a variety of activities. First, NACA educates and shares information with both its membership and its members’ consumer clients on a variety of topics, including consumer rights, common issues faced by consumers in the marketplace for financial services, and best practices in consumer advocacy. Id. at ¶ 10. NACA's educational activities take on many forms, including blog posts, newsletters, webinars, and in-person trainings. Id.
Second, NACA promotes the interests of consumers by serving as a...
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