July 13, 2020

Volume X, Number 195

July 13, 2020

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July 10, 2020

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Baptist Church Seeks to Intervene In CFPB Payday Rule Lawsuit

On September 19, 2018, the Georgia based Cooperative Baptist Fellowship (the “Fellowship”) filed a motion to intervene as a defendant in a case filed by the Community Financial Services Association of America Ltd. and the Consumer Service Alliance of Texas challenging the CFPB’s Payday Rule. The lawsuit was filed in April 2018 claiming, among other things, that the CFPB did not follow proper procedure in issuing the Payday Rule; that the CFPB improperly deemed certain lending practices unfair and abusive; that the CFPB’s authority to address unfair and abusive practices is unconstitutional; and that the CFPB’s structure is unconstitutional. The motion to intervene came on the heels of the trade group plaintiffs’ request to lift the stay and motion for a preliminary injunction.  The stay was entered in June.

The Fellowship claims that it has standing to intervene because of its previous efforts to get the Payday Rule written and, once the Rule is implemented, it would be able to redirect the resources it currently devotes to combating payday and vehicle title loans. The Fellowship further argued that it would vigorously defend the lawsuit, while the CFPB might not – citing the CFPB’s plans to reconsider the Rule as well as its willingness to stay the Rule’s compliance date.

In their opposition to the intervention motion, the trade group plaintiffs argued that the Fellowship’s interest in the lawsuit was too tenuous to support intervention, likening the Fellowship’s plea to the interest of any lobbying group seeking to join a lawsuit. They also argued that the Fellowship had not met its burden of overcoming the presumption that the CFPB would not adequately defend this case.  They further noted that the Fellowship could make legal arguments through an amicus brief without intervening.

The CFPB has not yet filed an opposition to the intervention motion and it is unclear whether it will do so.

A scheduling conference is being held by the Court on October 4, 2018.

The Payday Rule is currently set to be implemented by August 19, 2019.

Copyright © by Ballard Spahr LLPNational Law Review, Volume VIII, Number 274

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About this Author

Jenny Perkins, Ballard Spahr Law Firm, Philadelphia, Consumer Finance Litigation Attorney
Associate

Jenny N. Perkins regularly handles complex commercial litigation, with particular experience in consumer finance litigation and defending individual and class action lawsuits brought by consumers in the areas of federal and state consumer protection laws and mortgage banking. In addition, Ms. Perkins handles commercial litigation involving breach of contract, breach of fiduciary duty, and professional negligence claims. In June 2013, Ms. Perkins was second chair for a case in which the team received a federal jury verdict on behalf of an insurance broker client after a...

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