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District court stays proceedings pending outcome of English preliminary injunction appeal; English files opening appeal brief

On January 30, 2018, the federal district court hearing Leandra English’s action seeking a declaration that she is the lawful Acting CFPB Director granted the parties joint motion to stay further proceedings pending a decision from the D.C. Circuit in her appeal of the district court’s denial of her preliminary injunction motion.

Leandra English also filed her opening appeal brief with the D.C. Circuit on January 30.  In her brief, English argued that the district court “violated elementary principles of statutory construction in holding that Dodd-Frank’s mandatory language is ‘implicitly qualified’ by the FVRA.”  She also argued that appointing Mick Mulvaney as the Acting CFPB Director was inconsistent with Dodd-Frank’s mandate that the CFPB be an “independent” agency.  English appears to have abandoned the argument she made at the district court level that the FVRA does not apply because the Acting CFPB Director serves on the FDIC Board.

In her brief, English also claimed that the district court’s denial of the preliminary injunction was wrong because the court failed to recognize that she is suffering irreparable harm from the inability to exercise authority over the CFPB.

Strangely, English relied upon (a mischaracterized) quote of Alan Kaplinsky, the chair of Ballard Spahr’s Consumer Financial Services Group, in an attempt to support her argument that a preliminary injunction is needed to remove uncertainty as to who is the lawful Acting CFPB Director.  She references an article that quotes Alan as saying that the industry needs certainty about who the director is.

English neglected to mention, however, that the article, in the paragraph immediately before the one containing the  quote relied upon in her brief, also quotes Alan’s statement to the reporter that “[o]nly a permanent director, confirmed by the Senate, would definitely resolve the leadership dispute in the near term, Alan S. Kaplinsky said.”  Alan did not, as English suggests, say that granting her preliminary injunction motion would resolve the uncertainty problem.

Indeed, Alan, along with Jeremy Rosenblum and Theodore Flo of Ballard Spahr, filed an amicus brief in the district court case explaining why Mulvaney, not English, should serve as Acting CFPB Director.  That’s because the language in Dodd-Frank upon which English relies only covers temporary situations where the Director is unable to fulfill his/her duties as Director (e.g., hospitalization) and not a permanent vacancy resulting from a resignation.  As we argued in our amicus brief, the FVRA explicitly covers the latter situation.  Having decided to challenge Mulvaney’s appointment despite the lack of merit in her legal position, English should not now be permitted to benefit from the uncertainty her lawsuit has created.

Under the briefing schedule established by the D.C. Circuit, the DOJ’s opposition brief is due by February 23, 2018 and English’s reply brief is due by March 6, 2018.  Pursuant to federal appellate rules, amicus briefs must be filed within 7 days of the due date of the brief of the party an amici is supporting.  Accordingly, amicus briefs supporting English must be filed by February 6, 2018 and amicus briefs supporting Mulvaney must be filed by March 2, 2018.  The D.C. Circuit’s order setting the briefing schedule directed the Court Clerk to calendar the case for oral argument on the first available date following the completion of briefing.

Copyright © by Ballard Spahr LLPNational Law Review, Volume VIII, Number 32
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About this Author

Kaplinksy, partner, New York, finance
Partner

Alan S. Kaplinsky is Co-Practice Leader of the firm's Consumer Financial Services Group, which has more than 115 lawyers. Mr. Kaplinsky devotes his practice exclusively to counseling financial institutions on bank regulatory and transactional matters, particularly consumer financial services law, and defending financial institutions that have been sued by consumers in individual and class action lawsuits and by government enforcement agencies. Visit Mr. Kaplinsky's profile in Wikipedia.

...
215-864-8544
Flo, Washington DC, Ballard Spahr
Associate

A client-focused litigator and enforcement attorney, with extensive experience in the financial-services, technology, and real estate industries. Theodore R. ("Teddy") Flo represents lenders, technology companies, start-ups, corporate executives, and real estate service providers in local and national litigation, arbitration, and government investigations. While focused on investigations before the CFPB, he also represents clients before the SEC, DOJ, HUD, CFTC, and state regulators.

Teddy delivers practical cost-effective results for his clients through creative thinking and...

202-661-2259
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