A case before the U.S. Court of Appeals for the D.C. Circuit could impact the entire structure of the Consumer Financial Protection Bureau (CFPB), said Jon Eisenberg, partner at K&L Gates, in Legal Newsline.
In April, the court heard arguments from PHH Corp., which says CFPB Director Richard Cordray overstepped his authority by unilaterally overturning a $6.5 million fine imposed by an internal CFPB judge in favor of a $109 million fine. PHH also argued that the CFPB’s structure is unconstitutional.
“If this court looks at the agency and says, ‘We’re overturning your first enforcement action to reach us and we don’t think you are constitutional,’ that’s a big deal in terms of how other litigants will look at the possibility of challenging the CFPB’s actions,” said Eisenberg.