The U.S. Supreme Court has denied the Petition for a Writ of Certiorari Before Judgment filed by All American Check Cashing.
In its petition, All American sought to have the Supreme Court hear its interlocutory appeal from the district court’s ruling upholding the CFPB’s constitutionality rather than wait for a ruling on its appeal from the Fifth Circuit. Having filed its petition before the Supreme Court granted Seila Law’s certiorari petition, All American argued that its case was a better vehicle than Seila Law for deciding the constitutionality question but that, at a minimum, its case should be heard as a companion case to Seila Law.
All American’s primary argument for why its case would be a better vehicle was that, unlike Seila Law, its case “squarely present[ed]” the question of whether, even if the agency’s structure is unconstitutional, former Acting Director Mulvaney’s ratification of the CFPB’s challenged action cured any constitutional defect. Although the CFPB made the ratification argument in Seila Law, it was not addressed by either the district court or the Ninth Circuit (which both held that the CFPB’s structure is constitutional).
We are not surprised that the Supreme Court denied All American’s petition. It is likely the Supreme Court concluded that its resolution of the remedy question in Seila Law would be sufficient at this time and that it would have another opportunity to address any additional issues raised in All American after the Fifth Circuit renders its decision.
The question presented in Seila Law’s certiorari petition is whether the CFPB’s single-director-removable-only-for-cause structure violates the separation of powers in the U.S. Constitution. In its Order granting Seila Law’s petition, the Supreme Court directed the parties to also brief and argue the question whether the Dodd-Frank Act’s for-cause removal provision can be severed from the Act if the Bureau’s structure is found to be unconstitutional. If the Supreme Court reverses the Ninth Circuit on the CFPB’s constitutionality but rules that the for-cause removal provision can be severed, it is unclear whether the Supreme Court will address the effect of severance on prior CFPB actions. The Supreme Court will hold oral argument in Seila Law on March 3, 2020 and a decision is expected to be issued by the end of the Court’s term in June 2020.
In the meanwhile, it seems unlikely that the Fifth Circuit will issue a decision in All American Check Cashing before the Supreme Court issues its decision in Seila Law. Two other circuit court cases involving a challenge to the CFPB’s constitutionality have been put on hold pending the outcome in Seila Law. In CFPB v. CashCall, CashCall appealed to the Ninth Circuit from the district court’s decision ordering CashCall to pay a $10 million statutory fine based on its finding that it was the “true lender” of loans issued to borrowers in 16 states. CashCall’s grounds for appeal include the district court’s rejection of its constitutional challenge to the CFPB. The Ninth Circuit has issued an order withdrawing submission of the appeal and staying all further proceedings until the Supreme Court’s decision in Seila Law. In CFPB and People of the State of New York v. RD Legal, the CFPB and NYAG appealed to the Second Circuit from the district court’s decision holding the CFPB’s structure is unconstitutional and striking all of Title 10 of Dodd-Frank. The Second Circuit has adjourned oral argument until after Supreme Court issues a decision in Seila Law.