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Industry Coalition Challenges CFPB Arbitration Rule in Court

On September 29, 2017, a coalition of bank and trade associations filed a federal court challenge to the Consumer Financial Protection Bureau’s (“CFPB” or the “Bureau”) arbitration rule. The industry group plaintiffs allege that the arbitration rule is illegal on four grounds, including that the CFPB’s actions are unconstitutional, and that the Bureau violated the … Continue Reading

Federal Court Takes Expansive View of CFPB Statute of Limitations, Limits Restitution

On September 8, 2017, the U.S. District Court for the Northern District of California entered an order granting a civil penalty and injunctive relief in a CFPB case against mortgage loan servicer Nationwide Biweekly Administration, Inc. (“Nationwide”), its wholly-owned subsidiary Loan Payment Administration, and the principal of Nationwide. In its suit, the CFPB alleged that the … Continue Reading

District Court Sanctions CFPB for Discovery Misconduct; Dismisses Five Defendants from Lawsuit

On August 25, 2017, a federal judge for the U.S. District Court for the District of Georgia dismissed five payment processor defendants from a CFPB lawsuit, following what the Court described as the repeated failure by the Bureau to follow court discovery orders. In particular, the Bureau refused to provide factual evidence supporting the elements of … Continue Reading

CFPB Publishes Final Rule on Pre-Dispute Arbitration Agreements

Earlier this week, the Consumer Financial Protection Bureau published a final rule substantially curtailing the ability of financial services providers and consumers to enter into voluntary pre-dispute arbitration clauses.  The final rule, like the proposed rule that preceded it, would i) prevent financial services providers from including arbitration clauses in consumer contracts unless those arbitration … Continue Reading

CFPB Seeks Contempt Order against Investigation Target

On June 21, 2017, a federal district court judge referred to a magistrate the Consumer Financial Protection Bureau’s (“CFPB”) first attempt to obtain a contempt finding against a subject who allegedly failed to comply with a civil investigative demand (“CID”). The matter arrived in district court in November 2016, when the CFPB first sought judicial … Continue Reading

Texas District Court Rules that Notification of Purpose in CFPB CID Provides Fair Notice

On January 5, 2017, the Consumer Financial Protection Bureau (the “CFPB”) issued a civil investigative demand (“CID”) to The Source for Public Data, L.P. (“Public Data”), a company that collects personal information about consumers. The CID requested information to determine whether consumer reporting agencies, persons using consumer reports, or other persons have engaged or are … Continue Reading

Kokesh v. SEC and Implications for Consumer and Financial Regulatory Agencies

In its decision in Kokesh v. SEC, issued on Monday, June 5, 2017, the Supreme Court unanimously ruled that “disgorgement” of ill-gotten gains by the Securities and Exchange Commission (“SEC”) is a “penalty” within the meaning of 28 U.S.C. § 2462.  As a result, disgorgement is unavailable to the SEC in judicial proceedings involving conduct … Continue Reading

D.C. Circuit Holds Oral Argument in Rehearing of PHH v. CFPB

On May 24, 2017, the U.S. Court of Appeals for the D.C. Circuit held en banc oral argument in the rehearing of PHH Corp., et al. v. Consumer Financial Protection Bureau (“PHH”).  The lively oral argument extended well beyond the time originally allotted by the Court, as lawyers for PHH, the Department of Justice, and … Continue Reading

Conference of State Bank Supervisors Sues To Stop OCC Fintech Charters

On April 26, 2017, the Conference of State Bank Supervisors (“CSBS”) filed a complaint against the Office of the Comptroller of the Currency (“OCC”) and Comptroller of the Currency Thomas J. Curry to block the agency from going forward with its proposal to grant special purpose national bank charters to fintech companies. The CSBS filed … Continue Reading

D.C. Circuit Panel Rules that CFPB Civil Investigative Demand is Overly Broad and Unenforceable

On April 21, 2017, a panel of the U.S. Court of Appeals for the District of Columbia Circuit ruled that a civil investigative demand (“CID”) issued by the Consumer Financial Protection Bureau against the Accrediting Council for Independent Colleges and Schools (“ACICS”) was overly broad and unenforceable.  The D.C. Circuit’s decision sets an important precedent … Continue Reading

United States Files Amicus Brief in PHH Case

On March 17, 2017, the U.S. Department of Justice filed a Brief for the United States as Amicus Curiae in PHH Corporation v. Consumer Financial Protection Bureau, 839 F.3d 1 (D.C. Cir. 2016), a case challenging the constitutionality of the CFPB’s single-director structure pending before the U.S. Court of Appeals for the District of Columbia … Continue Reading

Solicitor General Requests Extension to File Amicus Brief for PHH v. CFPB and Signals Potential Shift in Support for the CFPB

As we previously discussed, on February 16, 2017, the D.C. Circuit granted rehearing en banc in PHH v. CFPB and vacated the holding from the three-judge panel that the CFPB’s single director structure was unconstitutional. Through an unopposed motion filed on March 3, 2017, the Office of the Solicitor General (“SG”) requested an extension to file … Continue Reading

D.C. Circuit Grants Rehearing En Banc in PHH

The D.C. Circuit today granted rehearing en banc in PHH Corp., et al. v. Consumer Financial Protection Bureau (“PHH”), vacating the prior order that, among other things, found the Consumer Financial Protection Bureau’s (“CFPB”) structure unconstitutional. The court directed the parties to brief a set of questions related to: the constitutionality of the Bureau’s structure; … Continue Reading

Seventh Circuit Holds Open a Narrow Path for Challenging Bank Supervisory Ratings

The U.S. Court of Appeals for the Seventh Circuit recently issued a rare decision on a bank’s ability to challenge its supervisory ratings—in this case, its Federal Deposit Insurance Company (“FDIC”) Capital, Assets, Management, Earnings, Liquidity and Sensitivity (“CAMELS”) rating—in court.  See Builders Bank v. FDIC, — F.3d —, 2017 WL 237585 (7th Cir. 2017) … Continue Reading

FTC Enforcement Action Signals Possible Changes Coming In Unfairness Doctrine

On February 6, the FTC, along with the State of New Jersey, announced a settlement with TV-maker VIZIO related to VIZIO’s alleged data collection practices on millions of its ‘smart,’ network-connected TVs. According to the complaint, VIZIO collected information on consumers which it then shared with third parties, without sufficiently disclosing the data collection and … Continue Reading

CFPB, New York AG Accuse Settlement Funding Company of Engaging in Deceptive and Abusive Conduct Towards 9/11 First Responders, NFL Players

On February 7, 2017, the Consumer Financial Protection Bureau (“CFPB”) and the New York Attorney General filed a complaint in federal court accusing companies RD Legal Funding, LLC, RD Legal Finance, LLC, and RD Legal Funding Partners, LP (collectively, “RD Legal”) and their principal, Roni Dersovitz, of misleading consumers regarding advances made on payouts from … Continue Reading

Legislators and Others Seek To Intervene in PHH v. CFPB Litigation

As we previously discussed, in October 2016, a 3-judge panel of the D.C. Circuit reviewing an enforcement action by the CFPB determined that the Bureau’s director is subject to at-will removal by the President.  The Bureau subsequently petitioned for re-hearing before the full court. Late last week, following a motion to intervene by several state … Continue Reading

In waning hours of Obama administration, CFPB files first litigation against depository institution

In what might prove to be one of Richard Cordray’s final acts as Director of the Consumer Financial Protection Bureau, the Bureau announced on Thursday that it was suing TCF National Bank, a $21 billion depository institution, in federal court for practices involving TCF’s overdraft program.  This enforcement action marks the first time the Bureau … Continue Reading

Congress Attempts to Counsel Trump Concerning Removal of CFPB Director Cordray, While PHH Petition for Rehearing Remains Undecided

Today Senators Chuck Schumer (D-NY), Sherrod Brown (D-OH), Elizabeth Warren (D-MA) and others voiced their opposition to any attempt by President-elect Donald Trump to oust Richard Cordray, the current Director of the Consumer Financial Protection Bureau (“CFPB”), before Cordray’s term ends in July 2018. They also sent a letter to Cordray outlining and praising his … Continue Reading
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