D.C. Court of Appeals Holds That Bank Has Standing to Challenge CFPB

The United States Court of Appeals for the District of Columbia Circuit recently reversed a lower court and found that a Texas bank has standing to challenge the constitutionality of the Consumer Financial Protection Bureau (“CFPB”).  See State Nat. Bank of Big Spring v. Lew, 795 F.3d 48 (D.C. Cir. 2015).  In the case, State National Bank of Texas filed a lawsuit challenging various provisions of the Dodd-Frank Act, including the constitutionality of the CFPB.  Specifically, the bank alleged (i) as an independent agency, the CFPB must be headed my multiple members and not a single director; (ii) the broad authority given to the CFPB violated the non-delegation doctrine; and (iii) President Obama’s recess appointment of CFPB Director Richard Cordray was unconstitutional.  The District Court dismissed the complaint, holding that the bank did not have standing to make these claims and that the claims were not ripe, as the bank had not suffered any injuries caused by the CFPB.  The Court of Appeals reversed, however, holding that the bank was regulated by the CFPB and thus had standing to pursue these claims.  Additionally, the court refused to make the bank wait until it had violated a CFPB regulation to file a complaint and held that the claims were ripe.  The case has been remanded to address these issues.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.com.