Is the CFPB Unconstitutional? We’ll Soon Find Out.

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Today, the Supreme Court granted certiorari in four cases. One of the four, Seila Law LLC v. Consumer Financial Protection Bureau asks the Court to consider whether the CFPB is unconstitutionally constituted. Specifically, the Court will consider whether it is unconstitutional for Congress to limit the President’s ability to remove the head of a single-headed agency, such as the CFPB. In this Seila Law presents a similar question to Collins v. Mnuchin, in which the U.S. Court of Appeals for the Fifth Circuit concluded that a similarly structured agency was unconstitutional.

In addition the constitutional separation of powers question, the Court has also asked the parties to brief the question of remedy. Specifically, the Court wants to know the extent to which the provision limiting removal of the head of the CFPB is severable from the rest of the law or, in the alternative, whether concluding that the CFPB is impermissibly constituted requires invalidating other aspects of the CFPB, if not the CFPB altogether.  The addition of this question was likely prompted, at least in part, by the Collins v. Mnuchin petition for certiorari, which sought the Court’s attention to the remedial issue.

It is also worth noting that the Court has appointed Alan Morrison to argue in defense of the CFPB’s constitutionality as an amicus curiae. This is necessary because the CFPB and the Department of Justice agree with the petitioners that the CFPB’s current structure is unconstitutional.

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