A few short months ago, I wrote a blog post about the Consumer Financial Protection Bureau surviving an attack on its constitutionality in the United States Court of Appeals for the Ninth Circuit. In that case, the plaintiff alleged that the CFPB’s structure was unconstitutional because it had a single director who did not serve at the pleasure of the President. The CFPB argued that its structure was, in fact, constitutional, and it won the argument. The plaintiff sought to have the case heard by the U.S. Supreme Court.
Now, in an apparent about-face, the CFPB is arguing that its structure is unconstitutional after all. In its brief on petition for a writ of certiorari, arguing that the Supreme Court should take up the appeal, the Bureau writes that the plaintiff “contends that the structure of the Bureau, including the for-cause restriction on the removal of its single director, violates the Constitution’s separation of powers.” The CFPB continues “[t]he Director of the Bureau has since reached the same conclusion.”
What, then, is the remedy? Is the CFPB itself unconstitutional? Not so, says the CFPB. The Bureau argued that the appropriate remedy for the constitutional violation is simply to sever the provision that limits the authority of the President to remove the Director.
Will the Supreme Court agree? That remains to be seen. Even if the Supreme Court does not agree to hear the appeal in this case, it seems clear that the Supreme Court will need to address the issue eventually. There is currently a circuit split and the constitutionality of a federal bureau should not depend on the state in which one lives.