February 17, 2019

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RD Legal Funding Asks Judge Preska To Stay NYAG’s Claims Pending CFPB’s Appeal From Rule 54(b) Judgment

RD Legal Funding has submitted a letter to Judge Preska indicating that it does not oppose her entry of a Rule 54(b) judgment to allow the CFPB to appeal her June 21 constitutionality ruling to the Second Circuit but renews its request that the proceeding be stayed during the pendency of any appeal.

RD Legal’s letter responds to the CFPB’s August 10 letter to Judge Preska indicating that it plans to file a motion for entry of a judgment pursuant to Rule 54(b).  RD Legal asserts that “implicit in the CFPB’s request…is the understanding that the NYAG’s claims should be stayed during the pendency of the appeal.”

In addition to asking Judge Preska to stay the proceeding, RD Legal asks her, if she enters a judgment against the CFPB pursuant to Rule 54(b), to certify the remainder of her June 21 order for interlocutory appeal under 12 U.S.C. Section 1292(b).  According to RD Legal, “[a]ll aspects of the Court’s constitutionality ruling, including its ruling permitting the NYAG to proceed under the stricken provisions of Title X, should be addressed in one proceeding.”  The “remainder” of Judge Preska’s June 21 order would also include her ruling that the NYAG could proceed with its state law claims against RD Legal.  (While the CFPB would have a right to appeal a judgment entered pursuant to Rule 54(b), if Judge Preska were to certify the remainder of her June 21 order for interlocutory appeal as requested by RD Legal, the Second Circuit would need to agree to hear RD Legal’s interlocutory appeal.)

The NYAG has submitted a letter to Judge Preska in which it challenges RD Legal’s argument that her dismissal of the CFPB from the case and striking of Dodd-Frank Title X necessitates her dismissal of the NYAG’s CFPA claims against RD Legal.  The letter also sets forth the NYAG’s opposition to Judge Preska’s issuance of a stay of the proceeding if she enters a Rule 54(b) judgment against the CFPB.

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About this Author

Kaplinksy, partner, New York, finance

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.