Democrats and Consumer Groups Seek Reconsideration in PHH Case

This article previously appeared on Ballard Spahr’s CFPB Monitor and is re-published here with permission.

After the D.C. Circuit panel issued a per curiam order on February 2 denying the three motions to intervene that were filed in the PHH case, we expected the next development in the case to be a decision by the D.C. Circuit on the CFPB’s petition for rehearing en banc.  Instead, the next development has been the filing of requests for the full court to reconsider the panel’s denial of the motions to intervene.

This past Friday, a petition for rehearing en banc was filed by Democratic AGs from 16 states and the District of Columbia and motions for reconsideration en banc were filed by Senator Sherrod Brown and Representative Maxine Waters and by Americans for Financial Reform, Center for Responsible Lending, Leadership Conference on Civil and Human Rights, United States Public Interest Research Group, Maeve Brown (who chairs the CFPB’s Consumer Advisory Board), and Self-Help Credit Union.

The motions to intervene were based in substantial part on the argument that because the movants can no longer rely on the CFPB and/or the DOJ under the Trump Administration to adequately defend the CFPB’s constitutionality and have a legal interest in the CFPB remaining an independent agency, intervention is necessary to protect the movants’ legal interests, including by filing a petition for a writ of certiorari.

The public interest groups state in their motion for reconsideration en banc that they had assumed their motion to intervene “would be circulated to the entire Court alongside the [CFPB’s] petition for rehearing” because they had been instructed by the clerk’s office to file an original and 19 copies of their motion.”  They attach their original motion to intervene and incorporate the arguments for intervention by reference in the new motion but add “one request.”  Their request is that if the court deems their motion for reconsideration premature “because today the CFPB continues to defend itself…the motion be held in abeyance and ruled upon either at the conclusion of the appeal, or when it becomes apparent that the CFPB is changing its position (whichever comes first).”  They also state that because the CFPB may depend on the DOJ to either file or respond to a petition for a writ of certiorari and the DOJ may have a different position on constitutionality than the CFPB, the court should grant their motion “at the conclusion of the case in any event to ensure that a party remains able to defend the constitutionality of the statute Congress enacted in the Supreme Court.”

The Democratic state AGs and lawmakers, instead of attaching their original motions to intervene, repeat their arguments for intervention in, respectively, their petition and motion for rehearing or reconsideration en banc. The lawmakers, like the consumer advocacy groups, ask the court, in the alternative to granting their motion, to “hold it in abeyance pending further developments in this case.” 

Given the weakness of their arguments for intervention, we were not surprised that the movants’ original motions to intervene were quickly denied by the panel.  We do find it surprising however that the movants are continuing to press these arguments in their new filings.  Under the Federal Rules of Appellate procedure, no response can be filed to a petition for an en banc consideration unless the court orders a response.

---

Copyright Ballard Spahr LLP. Reprinted with permission. Content is general information only, not legal advice or legal opinion based on any specific facts or circumstances.