Judge from Hawaii for the block.
Via Slate:
If you’ve been following the goings on at the Consumer Financial Protection Bureau, you could be forgiven for thinking there’s a constitutional crisis brewing in Trump’s America. It started on Friday when CFPB Director Richard Cordray stepped down and named his former chief of staff, Leandra English, as the bureau’s deputy director, a position that would seemingly entitle to her serve as the group’s interim director until Congress confirmed Cordray’s successor. For authority, Cordray cited the Dodd-Frank Act, which states that when the CFBD director is “unavailable,” the deputy serves as acting director.
Enter President Donald Trump, who, just a few hours after Cordray’s move, named Office of Management and Budget Director Mick Mulvaney to lead the CFPB on an interim basis. Mulvaney believes the group, which guards against predatory schemes by banks and lenders, should not exist. (He has called the CFPB “a sick joke.”) He also has another full-time job down the street at OMB. But Trump cites his authority under the Federal Vacancies Reform Act, and Trump’s Office of Legal Counsel filed a memo Saturday contending that the president has the clear legal authority to fill the spot.
This devolved into a national Twitter war over the weekend, with Team FVRA bashing Team Dodd-Frank and vice versa all up and down the internet. On Sunday, English filed a lawsuit challenging Mulvaney’s claim to the CFPB directorship and asked the courts to declare that she is the rightful acting director. (The case has been assigned to a Trump appointee, U.S. District Court Judge Timothy Kelly.) CFPB general counsel Mary McLeod, meanwhile, sided with the Trump administration. Mulvaney arrived at the bureau’s Washington headquarters on Monday morning brandishing a bag of doughnuts for the staff. His staffer tweeted a picture of him “hard at work as acting director.” One minute later, English sent an email to staff describing herself as acting director. Then Mulvaney circulated an email directing staff members to ignore English but to help themselves to doughnuts.
Gripping as this doughnut-laden political dispute may be, the legal battle revolves around a rather arcane clash of statutes. Given that two separate laws govern the replacement of an executive agency’s director, the question is which one controls here. On the one hand, the FVRA states that when an officer like Cordray resigns, the president “may direct” an individual who has already received Senate confirmation for his or her current position to assume that officer’s duties temporarily. In February, the Senate confirmed Mulvaney as director of OMB, so he would seem to fit this description, rendering his appointment legitimate.
But Dodd-Frank, the subsequent law that created the CFPB, provides a different mechanism for replacing the board’s director. The statute declares that the deputy director “shall … serve as acting director in the absence or unavailability of the Director.” English argues that, upon his resignation, Cordray became “absent,” allowing her to become “acting director.” She also contends that this regulation was intended to insulate CFPB from presidential whims. That sounds right—but so does Mulvaney’s argument on the FVRA. So which statute wins?
Slate contributor and University of Chicago Law School professor Daniel Hemel points to a provision in Dodd-Frank that weighs in Mulvaney’s favor. The law states that “except as otherwise provided expressly by law,” all federal laws “dealing with” federal officers “shall apply” to the CFPB. The FVRA is clearly such a law, so unless Dodd-Frank “expressly” overrides it, the statute applies here. And nothing in Dodd-Frank explicitly disavows the application of the FVRA to the CFPB. If the authors of the bill had intended to set up an exclusive line of succession for the agency, they could have. Instead, they included “a yield sign,” as Hemel put it, allowing the FVRA to prevail.