Judge denies injunction to remove Mick Mulvaney as consumer bureau's acting director

Erika Holt
January 13, 2018

Arguing that she is the agency's rightful director, English will likely appeal U.S. District Judge Timothy Kelly's ruling - but she might run in to a brick wall.

Kelly denied English's request for a preliminary injunction that would undo Mulvaney's appointment and block Trump from appointing anyone else.

A judge ruled Wednesday Mick Mulvaney is rightfully situated as the director of the Consumer Financial Protection Bureau (CFPB), striking a blow to Leandra English's bid to assume leadership against President Donald Trump's wishes. At the time even the CFPB's own general counsel said the law was on the President's side, but it was clear that a protracted legal battle lay ahead. Judge Kelly, in a highly complex analysis, punctured Gupta's arguments.

Within hours of Cordray's resignation announcement, Trump appointed Mulvaney to fill the post under the Federal Vacancies Act of 1998.

More compelling, as a read, however, was Kelly's description of the facts of the case.

Cordray announced on November 24 that he would step down effective midnight; he has since announced that he is running for governor of Ohio.

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"He stated that having his Chief of Staff serve as acting Director 'would minimize operational disruption and provide for a smooth transition given her operational expertise.' ..."

This case concerns whether the President is authorized to name an acting Director of the Consumer Financial Protection Bureau ("CFPB") or whether his choice must yield to the ascension of the Deputy Director, who was installed in that office by the outgoing Director in the hours before he resigned. Other structural features meant to protect that independence - such as the fact that the CFPB receives funding through the Federal Reserve instead of Congress, and the limits on the president's ability to remove the director - remained in place, the judge wrote, and Mulvaney's appointment was by definition temporary.

Kelly's account portrayed Mulvaney as stepping into the role, spending three days a week at the bureau and three at OMB, and acting and being treated as the boss. Thus, the particular policies or priorities that English or Mulvaney might pursue as the CFPB's acting Director are irrelevant to the Court's analysis.

A hearing on the motion for preliminary injunction was held in late December, resulting in Kelly's decision.

"There is an urgent public need for clarity", wrote Deepak Gupta, English's attorney, in the filing. Elizabeth Warren, commonly regarded as the conceiver of CFPB; and other present and former members of Congress.

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