American Financial Services Association

DC Court Grants Rehearing of PHH Case

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DC Court Grants Rehearing of PHH Case

This afternoon, the D.C. Circuit granted the rehearing petition in PHH Corp. v. CFPB. Previously, a three-judge panel of the court ruled that the Consumer Financial Protection Bureau’s (CFPB) structure was constitutionally flawed and that its director, currently Richard Cordray, should be removable at the will of the president. The Dodd-Frank Act currently stipulates that the director may only be removed “four cause.” Oral argument is scheduled for May 24, 2017. A decision is not expected until late summer at the earliest; a decision in the fourth quarter of this year is more likely.

In granting the petition, the court ordered that the three-judge panel’s ruling this past October be vacated. The court also directed the parties to address specific questions, including: (1) is the CFPB’s structure as a single-director independent agency consistent with Article II of the Constitution; and (2) may the court appropriately avoid deciding that constitutional question given the panel's ruling on the statutory issues in this case?

February 16th, 2017 by