Judge Dismisses Suit Against Mulvaney Appointment to CFPB

Ruling clears the deck for D.C. ruling to be final word in political battle over the bureau

Mick Mulvaney / Getty Images
February 2, 2018

A federal judge in the Southern District of New York dismissed a lawsuit that sought an injunction against President Donald Trump's appointment of Mick Mulvaney as the acting director of the Consumer Financial Protection Bureau.

The Lower East Side People's Federal Credit Union brought the case, arguing their "ability to provide financial counseling services to its members is imperiled by Mr. Mulvaney's appointment."

A political battle over the acting director position erupted when the CFPB's previous director, Richard Cordray, resigned last year, and on his way out appointed Leandra English as acting director. Trump simultaneously appointed Mulvaney.

The credit union also argued that due to policy changes hinted at by Mulvaney, they were "unable to engage in long-range planning" about oversight rules such as the Home Mortgage Disclosure Act.

Addressing numerous issues of standing, Judge Paul Gardephe ruled Friday that the plaintiffs used a "fear-based theory of standing" and "must instead allege a concrete and particularized injury by CFPB actions taken under Mulvaney."

With this case cleared from the courts, the ongoing legal battle in D.C. will now likely settle the question, barring any other unforeseen lawsuits being filed.

A judge has already denied a request for an injunction against Mulvaney in the D.C. case. That case has been appealed by English, who is not represented by the bureau's own counsel because they did not agree with English's legal theory as to why her appointment should supersede Mulvaney's.

English is using her own counsel, Deepak Gupta.

Gupta, meanwhile, has acknowledged English is not the person paying his legal bills, which raises the questions of who is underwriting the lawsuit.

Earlier this week, emails from a Freedom of Information Act request showed Cordray and other officials scrambling for a legal footing to make English the acting director as Cordray's exit was imminent.