PHH Opts Against Appealing CFPB Case to SCOTUS

This week, PHH Corp decided against appealing the January decision that found the Consumer Financial Protection Bureau’s single-director structure was permissible under the U.S. Constitution. The case, launched in 2015 and ultimately carried to the U.S. Court of Appeals for the District of Columbia Circuit, had been heralded as a landmark in determining the constitutionality of the CFBP’s authority.

This means that, barring future developments with other cases, the structure of the CFPB headed by a single director will remain in place for the time being. Since the creation of the Bureau, Republicans and conservatives have argued that the financial regulatory body should be led by a panel of several members, instead of imbuing much of the authority in a single Director figure.

The deadline to file an appeal to the Supreme Court was May 1.

As we wrote earlier this year, PHH Corporation v. Consumer Financial Protection Bureau represented perhaps the biggest legal saga in consumer finance in 2017. In the case, mortgage-lending company PHH challenged the imposition of fines for violations of the Real Estate Settlement Procedures Act made unilaterally by the CFPB’s former director, Richard Cordray, after the statute of limitations had run out.

In late 2016, a three-judge panel from the DC Circuit Court ruled 2-1 that that the CFPB’s leadership structure was unconstitutional. That decision was appealed by the CFPB, who asked the entire court to start over in deciding the case.

Other challenges to the CFPB’s constitutionality are still pending.