Court Dismisses Credit Union’s Challenge to Mulvaney’s Appointment

A federal court has dismissed a lawsuit filed by a New York credit union that challenged the President’s appointment of Mick Mulvaney as the Acting Director of the CFPB.  The credit union had sought a declaratory judgment from the court that Leandra English, the outgoing director’s appointee, is the lawful Acting Director.  The court held that the credit union did not have standing to challenge the appointment.

The credit union made several arguments for why it had standing.  First, it argued that it has a compelling interest in resolving the dispute over the CFPB’s Acting Director because it is regulated by the CFPB.  However, the court found that the fact that the CFPB regulates the credit union is insufficient to confer standing by itself, and the credit union did not allege it suffered any concrete and particularized injury.  Notably, the CFPB does not even supervise the credit union in question.

The credit union also argued that it had suffered a concrete and particularized injury because the CFPB harmed its “mission of improving the financial health of underserved communities.”  However, the court held that harm to a policy goal was not sufficient to confer standing, because the credit union did not allege any actual injury to itself as an organization.

The court also rejected arguments about hypothetical harm that the credit union made based on CFPB statements after the filing of the credit union’s complaint.  In particular the credit union asserted that it would suffer economic injury because the CFPB’s approach to enforcement of the new HMDA requirements would supposedly motivate banks to falsify HMDA data to show Community Reinvestment Act compliance, which the credit union theorized would cause them to do less business with the credit union.  And the credit union alleged that it would be unable to engage in long-range HMDA disclosure planning because of the uncertainty attached to the CFPB’s announced intention to engage in further rule-making regarding HMDA.

The case is Lower East Side People’s Federal Credit Union v. Trump, et al., Case No. 1:17-cv-09536 in the U.S. District Court for the Southern District of New York.