In June 2020, the National Association of Consumer Advocates, U.S. Public Interest Research Group, and Professor Kathleen Engel (collectively, the “Plaintiffs”) filed a lawsuit in the Massachusetts federal district court challenging the legality of the Consumer Financial Protection Bureau’s Taskforce on Federal Consumer Financial Law (the “Taskforce”).  The crux of the Complaint alleges that the Bureau’s Taskforce failed to comply with the Federal Advisory Committee Act (FACA), a federal law that governs the creation, operation, and management of advisory committees to federal agencies.  The Taskforce released its report making recommendations on how to improve consumer protection in the financial marketplace in January 2021. Among other provisions, FACA provides that unless “specifically authorized by statute or by the President,” an advisory committee may not be established without an agency head determining that the committee is “in the public interest in connection with the performance of duties imposed on that agency by law.”  5 U.S.C. App. 2 § 9(a)(2).  FACA also requires an advisory committee’s membership to be “fairly balanced” in terms of “the points of view represented and the functions to be performed by the advisory committee.”  5 U.S.C. App. 2 § 9(b)(2).  Further, FACA eschews inappropriate influence by the appointing authority or by any special interest.  5 U.S.C. App. 2 § 5(b)(3).

In August 2020, the Bureau moved for partial dismissal of the Plaintiffs’ complaint.  In March 2021, Magistrate Judge Jennifer C. Boal denied the Bureau’s motion, and the case proceeded to discovery.

Most recently, on August 20, 2021, the Plaintiffs moved for summary judgment, asking the court to rule in their favor on each of the four counts of the Complaint.  The Plaintiffs principally argue that:

  • The Taskforce is an advisory committee subject to FACA because:
    • It was “established or utilized” by the Bureau for the purpose of obtaining recommendations; and
    • FACA’s exemption for government employees does not apply.
  • The Taskforce violated FACA because:
    • It did not comply with FACA’s pre-chartering and transparency requirements; and
    • It was not fairly balanced.

Notably, the Plaintiffs point to the parties’ Joint Stipulation of Facts, in which the Bureau concedes that it “created and operated the [Taskforce] in a manner that did not comply with the requirements that apply to advisory committees [under FACA].” Furthermore, the Bureau concedes it did not create the Taskforce in a manner that complied with FACA’s pre-chartering requirements.

The Bureau likely will file a response in opposition to the Plaintiffs’ motion in the coming weeks, and the Plaintiffs will have an opportunity to file a reply.  Once briefing is complete, the Court will decide whether to grant the Plaintiffs’ requested relief.  Specifically, Plaintiffs have asked the Court to:

  • Enjoin the Bureau from using the Taskforce’s published report;
  • Compel the Bureau to place a disclaimer on the Taskforce’s report whenever it is disseminated, qualifying the report’s legitimacy;
  • Compel the Taskforce to release all of its records; and
  • Declare that the Bureau violated FACA and its implementing regulations when it created and administered the Taskforce.