IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF TEXAS 

WICHITA FALLS DIVISION 

CORNELIUS CAMPBELL BURGESS, 

 Plaintiff, 

 v. 

FEDERAL DEPOSIT INSURANCE 

CORPORATION; MARTIN J. 

GRUENBERG, in his official capacity as 

Acting Chairman of the FDIC; MICHAEL J. 

HSU, in his official capacity as a Director 

of the FDIC; ROHIT CHOPRA, in his 

official capacity as a Director of the FDIC; 

and JENNIFER WHANG; in her official 

capacity as an Administrative Law Judge, 

 Defendants. 

Civil Action No. 7:22-cv-00100-O 

The Honorable Reed O’Connor, 

United States District Judge, Presiding 

MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT 

OF PLAINTIFF’S MOTION FOR RECONSIDERATION 

James T. Dawson (TX Bar No. 24094618) 

 Pro Hac Vice (DC Bar No. 1602502) 

 Email: jamesdawson@velaw.com 

VINSON & ELKINS LLP 

2200 Pennsylvania Avenue, NW 

Suite 500 West 

Washington, DC 20037 

Telephone: (202) 639-6588 

Facsimile: (202) 639-6604 

 

Manuel G. Berrelez (TX Bar No. 24057760) 

 Email: mberrelez@velaw.com 

Thomas P. Mitsch (TX Bar No. No. 24102218) 

 Email: tmitsch@velaw.com 

James F. Hopper (TX Bar No. 24116535) 

 Email: jhopper@velaw.com 

Madelyn C. Stanley (TX Bar No. 24121529) 

 Email: mstanley@velaw.com 

VINSON & ELKINS LLP 

Trammell Crow Center

2001 Ross Avenue, Suite 3900

Dallas, Texas 75201

Telephone: (214) 220-7700 

Facsimile: (214) 220-7716 

Counsel for Plaintiff Cornelius Campbell Burgess

Case 7:22-cv-00100-O Document 54 Filed 12/02/22 Page 1 of 33 PageID 872
TABLE OF CONTENTS 

Page 

TABLE OF CONTENTS ................................................................................................................. i

TABLE OF AUTHORITIES .......................................................................................................... ii

INTRODUCTION .......................................................................................................................... 1

LEGAL STANDARD ..................................................................................................................... 4

BACKGROUND ............................................................................................................................ 5

 A. Legal Background ........................................................................................................... 5

 1. The Supreme Court’s Decision in Collins (June 2021) .......................................... 5

 2. The Fifth Circuit’s En Banc Decision in Cochran (December 2021) .................... 7

 3. The Fifth Circuit’s Panel Decision in Community Financial (October 2022) ........ 9

 B. Procedural History ........................................................................................................ 12

REASONS TO GRANT RECONSIDERATION ......................................................................... 13

I. The Portion of Community Financial on Which the Order Depended Cannot Be 

 Relied Upon Because, As Interpreted by the Order, It Conflicts with the Fifth 

 Circuit’s En Banc Decision in Cochran................................................................................ 13

II. Alternatively, This Court Can Read Community Financial and Cochran In Concert. ......... 19

 A. Community Financial Has No Applicability When, As Here, a Plaintiff Pressing 

 a Removability Argument Seeks Prospective Relief Only. ......................................... 19

 B. The Portion of Community Financial on Which the Order Relied Was Dicta. ........... 22

CONCLUSION ........................................................................................................................... 265 

CERTIFICATE OF SERVICE ..................................................................................................... 26

CERTIFICATE OF COMPLIANCE ............................................................................................ 27

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ii 

TABLE OF AUTHORITIES 

Cases: Page(s)

Austin v. Kroger Tex., L.P., 

864 F.3d 326 (5th Cir. 2017) ...................................................................................................... 5 

Bass v. Butler, 

116 F. App’x 376 (3d Cir. 2004) .............................................................................................. 23 

Bowsher v. Synar, 

478 U.S. 714 (1986) .................................................................................................................. 21 

Broussard v. S. Pac. Transp. Co., 

665 F.2d 1387 (5th Cir. 1982) (en banc) .................................................................................. 14 

Brown v. United States, 

No. 3:20-cv-063, 2021 WL 3729296 (S.D. Miss. Aug. 23, 2021) ............................................. 4 

Calcutt v. FDIC, 

37 F.4th 293 (2022)....................................................................................................... 11, 12, 16 

Calcutt v. FDIC, 

No. 22A255, 2022 WL 4546340 (U.S. Sept. 29, 2022) ..................................................... 11, 17 

Cochran v. SEC, 

20 F.4th 194 (5th Cir. 2021) .............................................................................................. passim

Collins v. Yellen, 

141 S. Ct. 1761 (2021) ....................................................................................................... passim

Community Fin. Servs. Ass’n of Am., Ltd. v. CFPB, 

51 F.4th 616 (5th Cir. 2022) .............................................................................................. passim

Community Fin. Servs. Ass’n of Am., Ltd. v. CFPB, 

558 F. Supp. 3d 350 (W.D. Tex. Aug. 31, 2021) ...................................................................... 11 

Consumers’ Research v. Consumer Prod. Safety Comm’n, 

No. 6:21-cv-256, 2022 WL 1577222 (E.D. Tex. Mar. 18, 2022) ....................................... 14, 15 

Corr. Servs. Corp. v. Malesko, 

534 U.S. 61 (2001) .................................................................................................................... 15 

Domain Prot., LLC v. Sea Wasp, LLC, 

No. 4:18-cv-792, 2019 WL 3933614 (E.D. Tex. Aug. 20, 2019) ............................................... 4 

Douthit v. Dean, 

568 F. App’x 336 (5th Cir. 2014) ............................................................................................... 5 

Felder v. Johnson, 

204 F.3d 168 (5th Cir. 2000) .................................................................................................... 23 

Free Enterprise Fund v. Pub. Co. Accounting Oversight Bd., 

561 U.S. 477 (2010) ............................................................................................................ 15, 21 

Case 7:22-cv-00100-O Document 54 Filed 12/02/22 Page 3 of 33 PageID 874
iii 

Cases—Continued: Page(s)

Geiger v. Allen, 

850 F.2d 330 (7th Cir. 1988) .................................................................................................... 21 

Howell Petroleum Corp. v. Samson Res. Co., 

903 F.2d 778 (10th Cir. 1990) .................................................................................................. 23 

Hoyt v. Lane Constr. Corp., 

927 F.3d 287 (5th Cir. 2019) .................................................................................................... 19 

Johnson v. Moral, 

843 F.2d 846 (5th Cir. 1988) .................................................................................................... 13 

Johnson v. Thayler, 

421 F. App’x 431 (5th Cir. 2011) ............................................................................................... 5 

KH Outdoor, L.L.C. v. City of Trussville, Ala., 

366 F. Supp. 2d 1141 (N.D. Ala. 2005) .................................................................................... 19 

Latham v. Shalala, 

36 F.3d 482 (5th Cir. 1994) ...................................................................................................... 13 

Lavespere v. Niagara Mach. & Tool Works, Inc., 

910 F.2d 167 (5th Cir. 1990) ...................................................................................................... 4 

Lirette v. N.L. Sperry Sun, Inc., 

810 F.2d 533 (5th Cir. 1987) .................................................................................................... 16 

Little v. Liquid Air Corp., 

37 F.3d 1069 (5th Cir. 1994) ...................................................................................................... 4 

Little v. Reclaim Idaho, 

140 S. Ct. 2616 (2020) .............................................................................................................. 17 

Matter of Howard, 

972 F.2d 639 (5th Cir. 1992) .................................................................................................... 13 

Matter of Swift, 

129 F.3d 792 (5th Cir. 1997) .................................................................................................... 16 

Merrill v. Milligan, 

142 S. Ct. 879 (2022) ................................................................................................................ 17 

M-I LLC v. FPUSA, LLC, 

No. SA:15-cv-406, 2015 WL 4460305 (W.D. Tex. July 21, 2015)............................................ 4 

Morris-Shea Bridge Co. v. Cajun Indus., LLC, 

No. 3:20-cv-00342, 2021 WL 4096555 (S.D. Tex. May 17, 2021)............................................ 4 

New York Life Ins. Co. v. Travelers Ins. Co., 

92 F.3d 336 (5th Cir. 1996) ...................................................................................................... 14 

Nken v. Holder, 

556 U.S. 418 (2009) .................................................................................................................. 17 

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iv 

Cases—Continued: Page(s)

Ochoa-Salgado v. Garland, 

5 F.4th 615 (5th Cir. 2021) ................................................................................................. 16, 23 

Providence Title Co. v. Truly Title, Inc., 

No. 4:21-cv-147, 2021 WL 5003273 (E.D. Tex. Oct. 28, 2021) ................................................ 4 

Racal Survey U.S.A., Inc. v. M/V COUNT FLEET, 

231 F.3d 183 (5th Cir. 2000) .................................................................................................... 14 

Richards v. J.A. Jones Constr. Co., 

782 F.2d 504 (5th Cir. 1986) .................................................................................................... 16 

Richardson v. Tex. Sec’y of State, 

978 F.3d 220 (5th Cir. 2020) .................................................................................................... 16 

Seila Law LLC v. CFPB, 

140 S. Ct. 2183 (2020) .............................................................................................................. 10 

Smith v. Reg’l Transit Auth., 

756 F.3d 340 (5th Cir. 2014) .................................................................................................... 14 

Thrift v. Estate of Hubbard, 

44 F.3d 348 (5th Cir. 1995) ...................................................................................................... 14 

Trump v. Int’l Refugee Assistance Project, 

137 S. Ct. 2080 (2017) .............................................................................................................. 17 

U.S. Nat’l Bank of Oregon v. Indep. Ins. Agents of Am., Inc., 

508 U.S. 439 (1993) .................................................................................................................. 23 

United States v. Smith, 

386 F.3d 753 (6th Cir. 2004) .................................................................................................... 22 

United States v. Tompkins, 

130 F.3d 117 (5th Cir. 1997) .................................................................................................... 18 

United States v. Wilson, 

776 F.3d 402 (6th Cir. 2015) .................................................................................................... 23 

Wynne v. Rochelle, 

385 F.2d 789 (5th Cir. 1967) .................................................................................................... 21 

Rules:

Federal Rule of Appellate Procedure 28(j) ................................................................. 11, 16, 22, 23 

Federal Rule of Appellate Procedure 35(c) .................................................................................... 2 

Federal Rule of Appellate Procedure 40(a)(1)(B) .......................................................................... 2 

Federal Rule of Civil Procedure 54(b) ........................................................................................ 4, 5 

Federal Rule of Civil Procedure 59(e) ........................................................................................ 4, 5 

Federal Rule of Civil Procedure 60(b) ............................................................................................ 5 

Case 7:22-cv-00100-O Document 54 Filed 12/02/22 Page 5 of 33 PageID 876
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Rules—Continued: Page(s) 

Fifth Circuit Rule 35.4 .................................................................................................................... 2 

Fifth Circuit Rule 40.4 .................................................................................................................... 2 

Other Authorities: 

Appellants’ Motion to Stay, Community Fin. Servs. Ass’n of Am., Ltd. v. CFPB 

(5th Cir. No. 21-50826), Doc. 00516039414 (Oct. 1, 2021) .................................................... 11 

Appellants’ Responsive Rule 28(j) Letter, Community Fin. Servs. Ass’n of Am., Ltd. v. CFPB

(5th Cir. No. 21-50826), Doc. 00516368486 (June 23, 2022) .................................................. 11 

Appellee’s Rule 28(j) Letter, Community Fin. Servs. Ass’n of Am., Ltd. v. CFPB 

(5th Cir. No. 21-50826), Doc. 00516360618 (June 16, 2022) .................................................. 11 

Application for Stay, Calcutt v. FDIC (No. 22A255) (Sept. 22, 2022) ........................................ 17 

Br. for Appellants, Community Fin. Servs. Ass’n of Am., Ltd. v. CFPB 

(5th Cir. No. 21-50826), Doc. 00516093957 (Nov. 15, 2021) ................................................. 11 

Br. for Appellees, Consumers’ Research v. Consumer Prod. Safety Comm’n 

(5th Cir. No. 22-40328), 2022 WL 6164656 (Sept. 30, 2022) ................................................. 15 

Reply & Resp. Br. of the United States, Collins v. Yellen, 

141 S. Ct. 1761 (Nos. 19-422, 19-563), 2020 WL 6322317 (Oct. 23, 2020). .......................... 17

Tr. of Community Fin. Servs. Ass’n of Am., Ltd. v. CFPB Oral Argument (May 9, 2022) .......... 23 

 

Case 7:22-cv-00100-O Document 54 Filed 12/02/22 Page 6 of 33 PageID 877
INTRODUCTION 

For nearly a decade, unelected bureaucrats at the Federal Deposit Insurance Corporation 

(“FDIC”) have been tirelessly prosecuting a deeply flawed administrative enforcement proceeding 

against Burgess. Last month, Burgess filed a motion for a preliminary injunction seeking to halt 

the continuation of that proceeding because it is plagued by multiple constitutional infirmities. On 

November 6, 2022, this Court entered an Order that granted that motion in part and denied it in 

part. ECF No. 31 (“Order”); see ECF No. 49. Burgess is grateful that the Court has recognized 

the Enforcement Proceeding violates his Seventh Amendment rights, and he is especially 

appreciative that this Court has endeavored to treat this case with appropriate urgency despite the 

complex nature of the issues it presents. That said, Burgess respectfully submits that the portion 

of the Order that denied relief as to Counts 1 and 2 of the Complaint should be reconsidered. 

Those Counts allege that several of the key actors in the Enforcement Proceeding—

including the appointed directors of the FDIC and the administrative law judges (“ALJs”) used by 

that agency—enjoy an unconstitutional level of protection from removal. Burgess has requested 

that this Court prospectively enjoin the FDIC from continuing the Enforcement Proceeding unless 

and until those removability defects are cured. In its Order, this Court agreed that the constitutional 

arguments made in Counts 1 and 2 of the Complaint “have merit,” but nonetheless concluded that 

it could not grant relief as to those Counts because Burgess has not demonstrated that he has 

suffered a “compensable harm” attributable to the removability defects. Order at 17. 

This Court’s holding on the remedial issues relied primarily on the Fifth Circuit’s recent 

decision in Community Financial Services Ass’n of America, Ltd. v. CFPB, 51 F.4th 616 (5th Cir. 

2022), cert. filed Nov. 14, 2022 (No. 22-448). The Community Financial opinion was published 

on October 19, 2022, which was thirteen days after Burgess filed his Complaint and four days after 

Burgess filed his memorandum in support of his motion for a preliminary injunction. See ECF 

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No. 15-1 (“Mot.”).1 Given the recency of Community Financial and the expedited timeline of this 

case, the parties did not have a chance to discuss Community Financial in their papers. 

The plaintiffs in Community Financial challenged the Payday Lending Rule (“Rule”) 

promulgated by the Consumer Financial Protection Bureau (“CFPB”) on the basis that the CFPB’s 

director was unconstitutionally shielded from removal at the time of the Rule’s promulgation. The 

plaintiffs argued throughout the case that the appropriate remedy was vacating that Rule, and they 

also suggested in several of their early filings that the CFPB should be enjoined from enforcing 

that rule on a going-forward basis. Community Financial held that the plaintiffs were not entitled 

to vacatur of the Rule. And, as relevant here, Community Financial also observed that the 

“determination as to whether an unconstitutional removal protection inflicted harm remains the 

same whether the petitioner seeks retrospective or prospective relief.” 51 F.4th at 631 (internal 

quotation marks omitted). Community Financial interpreted the Supreme Court’s decision in 

Collins v. Yellen, 141 S. Ct. 1761 (2021), “not [to] rest on a distinction between prospective and 

retrospective relief.” Id. Relying on Community Financial, this Court denied a preliminary 

injunction as to Counts 1 and 2 because Burgess had failed to demonstrate “that the 

unconstitutional removal provision[s] inflicted harm” on him—a requirement that, in the Court’s 

view, applied even in cases where the plaintiff is only “seeking prospective relief.” Order at 18. 

That holding should now be reconsidered. Insofar as Community Financial is interpreted 

to require depriving Burgess of any remedy—despite being subjected to ongoing enforcement 

proceedings by unconstitutionally insulated officials who are threatening to deprive him of his 

1

 Pursuant to Fifth Circuit Rules 35.4 and 40.4 and Federal Rules of Appellate Procedure 35(c) and 40(a)(1)(B), the 

deadline for the parties to file petitions for rehearing or rehearing en banc in Community Financial, if any, is 45 days 

after the issuance of the Opinion—i.e., on or before December 5, 2022. No such petition has yet been filed. 

On November 14, 2022, the Solicitor General filed a petition for a writ of certiorari in Community Financial. 

The government’s petition concerns a separate portion of the Community Financial opinion that is not relevant here—

i.e., the panel’s holding that the funding mechanism for the CFPB violates the separation of powers. 

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right to ever participate in the banking industry again—it is plainly in conflict with the Fifth 

Circuit’s prior en banc decision in Cochran v. SEC, 20 F.4th 194 (5th Cir. 2021), cert. granted, 

142 S. Ct. 2707 (2022). Cochran held that Collins’s “compensable harm” requirement applies 

when a plaintiff “seek[s] to ‘void’ the acts of an[ agency] official” after the fact, but does not apply 

when a plaintiff seeks equitable relief to secure “an administrative adjudication untainted by 

separation-of-powers violations” in a suit for “pre-enforcement review.” Id. at 210 n.16. This 

case falls squarely into the latter camp. And to the extent the two cases are inconsistent, this Court 

is bound to follow Cochran instead of Community Financial, both because Cochran is the earlierin-time decision and because Cochran is an en banc decision. Moreover, the parties in Community 

Financial never cited Cochran in any of their briefs or at argument, and Community Financial 

might well have been decided differently had they done so. The Fifth Circuit has repeatedly held 

that, when a critical case or argument is not briefed to a panel, future courts are not bound to follow 

that panel’s ruling, and can instead consider the implications of that case or argument for 

themselves. See infra Section I. 

Given Cochran’s plain holding that Collins’s “compensable harm” requirement does not 

apply to suits like this one, the most appropriate course of action would be for this Court to issue 

a new Order that follows Cochran and does not rely on Community Financial. But, at a minimum, 

this Court should strive to interpret Community Financial in a way that reconciles that case with 

Cochran. See infra Section II. There are two ways to do so. 

First, this Court can and should recognize that Community Financial applies only to afterthe-fact efforts to void agency actions. Community Financial, like Collins, was a case in which 

the plaintiffs sought to vacate an agency action. But in this case, Burgess is not seeking to vacate 

any FDIC action; indeed, he has disclaimed all forms of retrospective relief. Nor does Burgess 

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seek equitable relief to prevent the FDIC from enforcing an already-issued final agency action. 

Community Financial had no occasion to consider whether and how Collins might apply when, as 

here, the plaintiff seeks only forward-looking relief. Community Financial, therefore, has no 

applicability here. See infra Section II.A. 

Second, this Court could recognize that the snippet of Community Financial on which it 

previously relied was dicta. After the Fifth Circuit heard oral argument in Community Financial, 

the plaintiffs in that case filed a letter in which they conceded that “th[e] Court need not resolve 

whether Collins applies to prospective relief” and should instead “assume” that “Collins applies to 

the relief sought here.” That letter amounted to a forfeiture of the argument that Collins did not 

apply to requests for prospective relief, meaning that whatever comments the Community 

Financial panel later delivered on this issue were non-binding dicta. See infra Section II.B. 

LEGAL STANDARD 

Although the Federal Rules of Civil Procedure do not explicitly “recognize a ‘motion for 

reconsideration’ in haec verba,” the Fifth Circuit has consistently held that parties seeking to have 

a prior order reconsidered “on the merits” may file a motion under Rules 54(b), 59(e), or 60(b). 

Lavespere v. Niagara Mach. & Tool Works, Inc., 910 F.2d 167, 173 (5th Cir. 1990), abrogated on 

other grounds by Little v. Liquid Air Corp., 37 F.3d 1069 (5th Cir. 1994). A motion for 

reconsideration of an order denying a preliminary injunction is within the office of Rule 54(b), 

which provides that “any order” that “does not end the action . . . may be revised at any time before 

the entry of a judgment.”2 “Under Rule 54(b), the trial court is free to reconsider and reverse its 

2 See Providence Title Co. v. Truly Title, Inc., No. 4:21-cv-147, 2021 WL 5003273, at *3 (E.D. Tex. Oct. 28, 2021) 

(construing a motion to reconsider a preliminary-injunction order as a motion under Rule 54(b)); Brown v. United 

States, No. 3:20-cv-063, 2021 WL 3729296, at *5 (S.D. Miss. Aug. 23, 2021) (same); Morris-Shea Bridge Co. v. 

Cajun Indus., LLC, No. 3:20-cv-00342, 2021 WL 4096555, at *1 (S.D. Tex. May 17, 2021) (same); Domain Prot., 

LLC v. Sea Wasp, LLC, No. 4:18-cv-792, 2019 WL 3933614, at *1 (E.D. Tex. Aug. 20, 2019); M-I LLC v. FPUSA, 

LLC, No. SA:15-cv-406, 2015 WL 4460305, at *1 (W.D. Tex. July 21, 2015) (same). 

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decision for any reason it deems sufficient, even in the absence of new evidence or an intervening 

change in or clarification of the substantive law.” Austin v. Kroger Tex., L.P., 864 F.3d 326, 336 

(5th Cir. 2017) (internal quotation marks omitted). A district court’s “power to reconsider or 

modify interlocutory rulings” under Rule 54(b) “is not cabined by the heightened standards for 

reconsideration” under Rule 59(e); indeed, given that Rule 54(b) is substantially “more flexible” 

than Rule 59(e), the court may consider “new arguments” that were not raised in prior briefing—

an authority that “reflect[s] the inherent power of the rendering district court to afford such relief 

from interlocutory judgments as justice requires.” Id. at 337 (internal quotation marks omitted).3

BACKGROUND 

A. Legal Background 

1. The Supreme Court’s Decision in Collins (June 2021) 

In Collins, the Supreme Court confronted a challenge to certain actions taken by the Federal 

Housing Finance Agency (“FHFA”). The FHFA is an independent agency created by the Housing 

and Economic Recovery Act of 2008 to regulate two of the nation’s providers of mortgage 

financing (Fannie Mae and Freddie Mac). 141 S. Ct. at 1770, 1772-73. Shortly after coming into 

existence, the FHFA placed Fannie Mae and Freddie Mac into conservatorship and then agreed to 

infuse them with large amounts of capital in exchange for quarterly dividend payments. Id. at 

1170. In 2012, the FHFA brokered a new arrangement (the “third amendment”) under which the 

The Fifth Circuit has explained that, when a district court is asked to consider an “interlocutory order,” Rule 

54(b) provides the proper framework. Austin v. Kroger Tex., L.P., 864 F.3d 326, 336 (5th Cir. 2017) (emphasis added). 

And a “district court’s denial of a motion for a preliminary injunction is an . . . interlocutory order.” Douthit v. Dean, 

568 F. App’x 336, 337 (5th Cir. 2014); accord Johnson v. Thayler, 421 F. App’x 431, 431 (5th Cir. 2011). By contrast, 

a request to “reconsider a judgment” is considered under Rule 59(e), so long as it is filed within 28 days after entry 

of that judgment. Austin, 864 F.3d at 336 (emphasis added). When a motion seeks reconsideration of a judgment 

older than 28 days, or reconsideration of any “final” order, the motion is considered under Rule 60(b). 

3

 In his Opposition to Defendants’ Motion for Reconsideration, Burgess noted that the Defendants improperly raised 

new arguments in their motion. See ECF No. 37 at 1-2. Burgess’s arguments here are different in that, as explained 

above, Community Financial was not issued until after Burgess filed his motion for a preliminary injunction. 

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prior dividend formula was replaced with a requirement that Fannie Mae and Freddie Mac make 

enormous quarterly payments to the Treasury Department. See id. The third amendment stayed 

in place for four years, until it was replaced by the fourth amendment in 2021. See id. at 1774. 

The Collins plaintiffs were shareholders in Fannie Mae and Freddie Mac. In 2016, they 

filed a lawsuit challenging the third amendment. They argued, among other things, that the FHFA 

was unconstitutionally structured because it was headed by a single Director who could only be 

fired by the President for cause. 141 S. Ct. at 1175. The plaintiffs requested a declaration that the 

FHFA was unconstitutional, an injunction ordering the Treasury to return the payments made 

under the third amendment, vacatur of the third amendment, and an injunction preventing the 

FHFA “from taking any further action to implement the third amendment.” Id.

On the merits, the Supreme Court agreed that the statutory restrictions on the President’s 

power to remove the FHFA Director violated the separation of powers. 141 S. Ct. at 1183-87. 

Having concluded that the FHFA was unconstitutionally structured, the Court then turned to the 

question of remedies. The Court began its discussion by noting that the plaintiffs “no longer ha[d] 

a live claim for prospective relief” and that “the only remaining . . . question concern[ed] 

retrospective relief.” 141 S. Ct. at 1787; see id. at 1795 (Gorsuch, J., concurring) (“[T]he only 

question before us concerns retrospective relief.”); id. at 1800 (Kagan, J., concurring in part) 

(concurring as to the remedial analysis because the Court “well explains why backwards-looking

relief is not always necessary to redress a removal violation” (emphasis added)). That was so 

because the third amendment—the one “that had caused the shareholders’ injury”—had been 

superseded by a fourth amendment during the appeal. Id. at 1780 (majority). And because the 

third amendment was “no longer in place, the shareholders no longer ha[d] any ground” for seeking 

“prospective relief,” but did “retain an interest in the retrospective relief they [had] requested,” 

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namely “an order setting aside the [third] amendment and requiring the return . . . of all dividend 

payments made pursuant to it.” Id. at 1787 (internal quotation marks and brackets omitted). 

Given that requests for prospective relief were moot, the Court limited its discussion to the 

propriety of the plaintiffs’ requested retrospective remedy. The Court held that there was “no 

reason to regard any of the actions taken by the FHFA in relation to the third amendment as void” 

because “[a]ll the officers who headed the FHFA during the time in question were properly 

appointed.” 141 S. Ct. at 1787 (emphasis removed). But the Court then noted: 

That does not necessarily mean, however, that the shareholders have no entitlement 

to retrospective relief. . . . [I]t is still possible for an unconstitutional provision to 

inflict compensable harm. And the possibility that the unconstitutional restriction 

on the President’s power to remove a Director of the FHFA could have such an 

effect cannot be ruled out. Suppose, for example, that the President had attempted 

to remove a Director but was prevented from doing so by a lower court decision 

holding that he did not have “cause” for removal. Or suppose that the President 

had made a public statement expressing displeasure with actions taken by a Director 

and had asserted that he would remove the Director if the statute did not stand in 

the way. In those situations, the statutory provision would clearly cause harm. 

Id. at 1788-89. The Court then remanded so that the lower courts could determine whether the 

plaintiffs had suffered a “compensable harm” that would entitle them to relief. Id. at 1789. 

2. The Fifth Circuit’s En Banc Decision in Cochran (December 2021) 

Some six months after Collins was decided, the Fifth Circuit held in Cochran that the 

judicial-review provision in the Exchange Act did not divest district courts of subject-matter 

jurisdiction to entertain a lawsuit alleging that the SEC’s ALJs enjoyed an unconstitutional level 

of protection from removal. 20 F.4th at 198. Ms. Cochran’s lawsuit “did not seek review of any 

particular SEC order,” but rather sought (1) “a declaration that SEC ALJs are unconstitutionally 

insulated from . . . removal” and (2) an “injunction” that would prospectively “bar[] the SEC from 

continuing its administrative proceedings against her.” Id. at 213. The Fifth Circuit held that the 

District Court had jurisdiction to consider Cochran’s request for those remedies, which are 

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8 

identical to the remedies Burgess seeks in this lawsuit. And this Court’s Order in turn found that 

the merits “analysis in this case should be identical” to the merits analysis in Cochran, given that 

Mr. Burgess and Ms. Cochran are pursuing overlapping legal theories. Order at 13. 

But this Court’s Order did not cite or otherwise discuss footnote 16 of the Cochran

decision, which provided an important analysis of the Supreme Court’s Collins decision. The 

dissenters in the Cochran case argued that, because the Supreme Court has “recognized a 

meaningful opportunity to bring post-enforcement Appointments Clause challenges,” and because 

“the injury Cochran would suffer from an enforcement proceeding presided over by an 

unconstitutionally insulated ALJ is supposedly less ‘serious’ than the injury caused by an 

enforcement proceeding presided over by an unconstitutionally appointed ALJ,” it must be the 

case that Cochran would “have a meaningful opportunity for post-enforcement judicial review of 

her claim.” Cochran, 20 F.4th at 210 n.16; see id. at 243-44 (Costa, J., dissenting). The Cochran

majority then explained that: 

In making this curious argument, the dissenting opinion relies solely on the 

Supreme Court’s recent decision in Collins, which held that the Director of the 

[FHFA] was unconstitutionally insulated from the President’s removal power, but 

that this constitutional defect did not render the Director's acts “void.” 141 S. Ct. 

at 1787. Collins does not impact our conclusion in this case because Cochran 

does not seek to “void” the acts of any SEC official. Rather, she seeks an 

administrative adjudication untainted by separation-of-powers violations. 

Id. at 210 n.16 (majority) (emphasis added). Footnote 16 of Cochran correctly read the remedial 

discussion in Collins as limited to cases where the plaintiff sought retrospective relief, such as 

“void[ing]” an agency’s prior act. The majority found that Collins simply “does not impact” the 

analysis when a plaintiff seeks prospective relief, as Ms. Cochran had through her request for “an 

injunction barring the SEC from continuing its administrative proceedings against her.” Id. at 213. 

Judge Oldham’s six-Judge concurrence in Cochran likewise read Collins as a case that dealt only 

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9 

with the requirements for “winning retrospective relief.” Id. at 232 (Oldham, J., concurring) 

(emphasis added). At the very least—and regardless of whether the distinction is phrased in the 

argot of “prospective vs. retrospective” relief—the Cochran majority plainly held that Collins does 

not forbid equitable relief to stop an ongoing proceeding before unconstitutionally insulated 

adjudicator(s), where the plaintiff is not seeking to “void” any already-extant agency decision. 

Indeed, the majority specifically explained that if, as the dissent suggested, Collins’ remedial 

analysis would foreclose relief on Ms. Cochran’s removal claim in a post-enforcement petition for 

review, that would strengthen the majority’s conclusion that only pre-enforcement review

offered the prospect of “meaningful judicial review”—because it would provide the only path to 

relief for Ms. Cochran. Id. at 210 n.16 (majority) (emphasis added). 

3. The Fifth Circuit’s Panel Decision in Community Financial (October 2022) 

The plaintiffs in Community Financial were payday lenders and other credit-access 

companies who challenged the validity of the CFPB’s 2017 Payday Lending Rule on various 

grounds, including, as relevant here, a claim that the CFPB Director was unconstitutionally 

shielded from removal at the time of that Rule’s promulgation. See Community Financial, 51 

F.4th at 623, 625-26. Their initial Complaint was filed on April 9, 2018.4 As of that time, the 

Payday Lending Rule had been promulgated but was not scheduled to go into effect until August 

2019, and the CFPB had announced an intent to begin notice-and-comment rulemaking to 

reconsider the rule given the change in Administrations.5 The plaintiffs’ Complaint alleged that 

the Payday Lending “Rule must . . . be invalidated and enjoined” due to the removability problem,6

4 Comm. Fin. Servs. Ass’n of Am., Ltd. v. CFPB, No. 1:18-cv-295 [hereinafter “Community Financial District Court 

Docket”], ECF No. 1 (W.D. Tex. Apr. 9, 2018). 

5 Community Financial District Court Docket, ECF No. 16 at 2 (May 31, 2018). 

6 Community Financial District Court Docket, ECF No. 1 at ¶ 76 (Apr. 9, 2018). 

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and the plaintiffs requested that the Court issue an “order and judgment holding unlawful, 

enjoining, and setting aside the [Payday Lending] Rule.”7 Before the Defendants answered, the 

Court entered an order staying the lawsuit pending the completion of the CFPB’s rulemaking 

process.8 

The case was then dormant for almost nine months, during which time (1) the Supreme 

Court decided Seila Law LLC v. CFPB, 140 S. Ct. 2183 (2020); and (2) the CFPB promulgated a 

final rule that partially revoked the Payday Lending Rule. The plaintiffs then filed an amended 

Complaint, which claimed that the surviving portions of the Payday Lending Rule were “void ab 

initio” because the CFPB was “unconstitutionally structured” when the original Rule was 

promulgated.9 The plaintiffs’ amended Complaint also requested that the Court issue an order 

“holding unlawful, enjoining enforcement of, and setting aside the 2017 Rule.”10

The parties then filed cross-motions for summary judgment. Shortly after those motions 

were fully briefed, the Supreme Court decided Collins. The plaintiffs advised the district court in 

a supplemental filing that, in their view, “Collins created a standard for deciding when to grant 

‘retrospective relief’” but “did not purport to limit prospective relief,” which the plaintiffs claimed 

to have sought “by requesting an injunction against the future enforcement of” surviving portions 

7

Id. at pp. 27, 38 (wherefore clauses). 

8 Community Financial District Court Docket, ECF No. 36 (Aug. 7, 2018) and ECF No. 56 (Mar. 1, 2019). 

9 Community Financial District Court Docket, ECF No. 76 at ¶¶ 8, 95 (Aug. 28, 2020). 

10 Id. at 41 (wherefore clauses); see id. at ¶ 115 (claiming the Rule should “be invalidated and enjoined”); see also

Community Financial District Court Docket, ECF No. 80 at 31 (Sept. 25, 2020) (“[T]he 2017 Rule, and any current 

effort to enforce it, unconstitutionally regulates Plaintiffs and must be enjoined.”). 

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of the Payday Lending Rule.11 The District Court entered an order granting summary judgment to 

the CFPB on August 31, 2021,12 and the plaintiffs appealed to the Fifth Circuit. 

On appeal, the plaintiffs initially renewed their argument that Collins did not apply to 

requests for “prospective relief . . . like the injunction [they] sought.”13 Their contention was that 

they were “entitle[d] . . . to prospective relief” because the CFPB “lacked authority to promulgate 

the Rule because its director at the time was unconstitutionally insulated from removal.”14

None of the parties’ appellate briefs cited the Fifth Circuit’s en banc decision in Cochran, 

which was issued after the plaintiffs filed their opening brief and before the CFPB filed its response 

brief. Nor was the Cochran decision mentioned at oral argument or in any Rule 28(j) letter. 

After all of the briefs in Community Financial were filed and the case had been argued to 

the Fifth Circuit, the Sixth Circuit issued its decision in Calcutt v. FDIC, 37 F.4th 293 (2022), 

mandate recalled and stayed, No. 22A255, 2022 WL 4546340 (U.S. Sept. 29, 2022). The 

government submitted the Calcutt opinion to the Community Financial panel in a letter pursuant 

to Federal Rule of Appellate Procedure 28(j), and argued in that letter that Calcutt supported its 

theory that the requirement to show a “compensable” harm “‘remain[ed] the same whether the 

[challenger] seeks retrospective or prospective relief.’”15 The plaintiffs then filed a responsive 

letter stating that the “th[e] Court need not resolve whether Collins applies to prospective relief.”16 

11 Community Financial District Court Docket, ECF No. 91 at 1 (June 30, 2021) (emphasis omitted); id. at 3 (plaintiffs 

claiming that they were seeking “prospective relief against future regulatory enforcement” (emphasis altered)). 

12 Community Financial District Court Docket, ECF No. 103 (Aug. 31, 2021) (reported at 558 F. Supp. 3d 350). 

13 Br. for Appellants at 16, Community Financial (5th Cir. No. 21-50826), Doc. 00516093957 (Nov. 15, 2021). 

14 Appellants’ Motion to Stay at 15, Community Financial (5th Cir. No. 21-50826), Doc. 00516039414 (Oct. 1, 2021). 

15 Appellee’s Rule 28(j) Letter at 1, Community Financial (5th Cir. No. 21-50826), Doc. 00516360618 (June 16, 2022) 

(quoting Calcutt, 37 F.4th at 293). 

16 Appellants’ Responsive Rule 28(j) Letter at 2 n.1, Community Financial (5th Cir. No. 21-50826), Doc. 

00516368486 (June 23, 2022). 

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The plaintiffs went on to explain that, in their view, they had “satisfied Collins by establishing that 

President Trump would have removed [CFPB] Director Cordray,” so “the Court can simply 

assume arguendo that Collins applies to the relief sought here.”17 

The Fifth Circuit issued its decision in Community Financial approximately two weeks 

after Burgess filed his Complaint in this matter. The Fifth Circuit began its analysis by 

acknowledging, as had the District Court, that the Supreme Court had vindicated the plaintiffs’ 

argument that Congress could not restrict the President’s ability to remove the CFPB Director at 

will. See Community Financial, 51 F.4th at 631 (discussing Seila Law). But the panel ultimately 

declined to grant the plaintiffs their requested relief based on its view that they had failed to 

discharge their obligation to “demonstrate that the unconstitutional removal provision caused them 

harm.” Id. at 632. As part of its remedial discussion, the panel stated that: 

Collins did not rest on a distinction between prospective and retrospective relief. 

As the Sixth Circuit recently explained, Collins’s remedial inquiry “focuse[d] on 

whether a ‘harm’ occurred that would create an entitlement to a remedy, rather than 

the nature of the remedy, and our determination as to whether an unconstitutional 

removal protection ‘inflicted harm’ remains the same whether the petitioner seeks 

retrospective or prospective relief.” Calcutt v. FDIC, 37 F.4th 293, 316 (6th Cir. 

2022). 

Id. at 631. The panel then held that summary judgment against the plaintiffs was proper because 

they had failed to demonstrate the type of “compensable harm” discussed in Collins. Id. at 623. 

B. Procedural History 

On October 15, 2022, Burgess filed a motion for a preliminary injunction. With respect to 

Count 1, Burgess argued that he was likely to succeed on the merits of his claim that the FDIC’s 

Board is unconstitutionally structured because a majority of its members cannot be fired at will by 

the President. See Mot. at 8-11. And with respect to Count 2, Burgess argued that he was likely 

17 Id.

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to succeed on the merits of his claim that the administrative law judges used by the FDIC enjoy an 

unconstitutional level of protection from removal. See id. at 11-14. 

This Court issued an Order on November 6, 2022 that granted Burgess’s motion in part 

and denied it in part. This Court held that Burgess was “unlikely to succeed on the merits of the 

remedy” as to Counts 1 and 2 because, although those two claims “have merit” as a matter of 

constitutional law, this “Court cannot afford Plaintiff any relief as to these claims.” Order at 17. 

That holding was premised primarily on Community Financial. This Court concluded that, 

even when a plaintiff seeks only prospective relief, he “must demonstrate that . . . the 

unconstitutional removal protection inflicted harm.” Id. at 17 (internal quotation marks omitted). 

This Court rejected Burgess’s argument “that the Collins harm requirement only arises when a 

plaintiff is seeking retrospective relief,” reasoning that, under Community Financial, a “plaintiff 

must demonstrate . . . that the unconstitutional removal provision inflicted harm” “even in cases 

where the plaintiff is seeking prospective relief.” Id. at 18. The Court then concluded that Burgess 

“has not shown a substantial likelihood of succeeding” on Counts 1 and 2 because he “provided 

no evidence” that he has suffered a “harm of the kind required under Collins.” Id. at 18-19. 

REASONS TO GRANT RECONSIDERATION 

I. The Portion of Community Financial on Which the Order Depended Cannot Be 

Relied Upon Because, As Interpreted by the Order, It Conflicts with the Fifth 

Circuit’s En Banc Decision in Cochran. 

The Fifth Circuit has repeatedly held that, when two of its published opinions are “in 

conflict,” courts in this Circuit are “bound to follow . . . the earlier decision of th[e] court on the 

subject.” Matter of Howard, 972 F.2d 639, 641 (5th Cir. 1992).18 That rule applies with special 

18 Accord Latham v. Shalala, 36 F.3d 482, 483 n.1 (5th Cir. 1994) (“Where decisions conflict, the earlier decision 

should be followed.”); Johnson v. Moral, 843 F.2d 846, 846-48 (5th Cir. 1988) (noting that it is “firmly established” 

that, “should a later panel render a decision conflicting with that of an earlier one, it is the earlier decision which is to 

be followed and not the later”), rev’d on other grounds on reh’g sub nom. Johnson v. Morel, 876 F.2d 477 (5th Cir. 

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force when the earlier-in-time decision is an en banc opinion. That is so because, when there is 

“any conflict between” a panel decision of the Fifth Circuit and an en banc decision of the Fifth 

Circuit, “the latter controls.” Racal Survey U.S.A., Inc. v. M/V COUNT FLEET, 231 F.3d 183, 190 

n.7 (5th Cir. 2000); accord Smith v. Reg’l Transit Auth., 756 F.3d 340, 345 n.4 (5th Cir. 2014). 

Thus, to the extent that the Fifth Circuit’s panel decision in Community Financial conflicts 

with its en banc decision in Cochran, this Court would be required to follow Cochran. 

And such a conflict clearly exists, assuming Community Financial is interpreted to apply 

to the facts of this case. As explained above, footnote 16 of Cochran explicitly held that Collins 

does not “impact” the analysis in cases where the plaintiff “does not seek to ‘void’ the acts of any 

[agency] official” but simply “seeks an administrative adjudication untainted by separation-ofpowers violations.” Cochran, 20 F.4th at 210 n.16. Relying on this very footnote, other courts 

within the Fifth Circuit have recently interpreted Cochran in exactly the way that Burgess 

interprets Collins here. Indeed, Burgess cannot improve on Judge Kernodle’s careful analysis of 

this issue in his recent decision in Consumers’ Research v. Consumer Product Safety Commission, 

No. 6:21-cv-256, 2022 WL 1577222 (E.D. Tex. Mar. 18, 2022), appeal docketed May 18, 2022 

(5th Cir. No. 22-40328). Judge Kernodle explained there that: 

1989); see id. (noting that this rule “rests on the obvious premise that, since the later panel decision should have 

followed that of the first panel, the third panel coming to examine the Circuit’s precedent on the point is bound by the 

decision of the first panel—just as, indeed, was the second panel” (emphasis altered)); New York Life Ins. Co. v. 

Travelers Ins. Co., 92 F.3d 336, 340 n.4 (5th Cir. 1996) (“Although we acknowledge the inconsistency in our caselaw, 

we are bound to follow the earlier decision.”); Thrift v. Estate of Hubbard, 44 F.3d 348, 362 n.28 (5th Cir. 1995) 

(collecting case law confirming that courts in the Fifth Circuit are “bound by the earliest decision . . . when [a] conflict 

exists”); see also Broussard v. S. Pac. Transp. Co., 665 F.2d 1387, 1389 (5th Cir. 1982) (en banc) (similar). 

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Collins does not address requests for prospective relief. Instead, Free Enterprise 

Fund [v. Public Company Accounting Oversight Board, 561 U.S. 477 (2010) 

(“PCAOB”)] governs. In that case, the Supreme Court squarely held that plaintiffs 

challenging removal restrictions could obtain declaratory relief without

demonstrating the restrictions inflicted “compensable harm” or identifying a 

“plausible nexus” between the restrictions and the challenged action. See 561 U.S. 

at 513; see also id. at 491 n.2. The Court stated: “[Petitioners] are entitled to 

declaratory relief sufficient to ensure that the reporting requirements and auditing 

standards to which they are subject will be enforced only by a constitutional agency 

accountable to the Executive.” Id. at 513. This type of equitable relief “has long 

been recognized as the proper means for preventing entities from acting 

unconstitutionally.” Id. at 491 n.2 (quoting Corr. Servs. Corp. v. Malesko, 534 

U.S. 61, 74 (2001)). 

Indeed, the Fifth Circuit held in Cochran v. SEC that Collins does not apply to 

plaintiffs seeking prospective relief. See 20 F.4th at 210 n.16 (“Collins does not 

impact our conclusion in this case because Cochran does not seek to ‘void’ the acts 

of any SEC official. Rather, she seeks an administrative adjudication untainted by 

separation-of-powers violations.”). 

Id. at *13 (emphasis added; internal citations omitted).19

Cochran’s holding that Collins does not “impact” the remedial analysis when the plaintiff 

“does not seek to ‘void’ the acts” of an agency, but seeks only prospective relief to ensure “an 

administrative adjudication untainted by separation-of-powers violations,” 20 F.4th at 210 n.16, is 

clearly in conflict with Community Financial’s statement that “Collins did not rest on a distinction 

between prospective and retrospective relief,” 51 F.4th at 631, to the extent the latter is applied to 

the circumstances here. Footnote 16 of Cochran clarifies that Collins applies when a plaintiff 

“seek[s] to ‘void’ the acts of an[] agency official,” but does not apply when a plaintiff seeks solely 

the prospective relief of “an administrative adjudication untainted by separation-of-powers 

violations.” 20 F.4th at 210 n.16. Insofar as Community Financial is interpreted to prescribe the 

19 On appeal, the Consumers’ Research plaintiffs explained that this passage from Judge Kernodle’s decision is 

sensible because, “[e]ven if a removal restriction did not affect an agency’s past conduct, that would not justify 

permitting the agency to unconstitutionally proceed without presidential oversight in the future.” Br. for Appellees 

at 47-48, Consumers’ Research v. Consumer Prod. Safety Comm’n (5th Cir. No. 22-40328), 2022 WL 6164656 (Sept. 

30, 2022) (emphasis altered); see id. at 48 (“This Court should decline the government's invitation to insulate 

unconstitutional removal restrictions from any meaningful judicial review on both the front-end and the back-end.”). 

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opposite rule—i.e., that a “determination as to whether an unconstitutional removal protection 

‘inflicted harm’ remains the same whether the petitioner seeks retrospective or prospective relief,” 

even where (unlike in Community Financial itself) a plaintiff does not seek to void any prior 

agency action, the cases are plainly in conflict. Community Financial, 51 F.4th at 631. Faced with 

that conflict, this Court must follow Cochran, the earlier-decided en banc decision. 

It also bears mention that Community Financial may well have been decided differently if 

the panel had been made aware of the import of the Cochran decision for its remedial analysis. 

But Cochran was never cited in the Community Financial briefs, was not submitted to the Court 

via a letter pursuant to Federal Rule of Appellate Procedure 28(j), and was not discussed at 

argument. In this Circuit, the fact that a particular issue was not raised in the parties’ briefs means 

that future Fifth Circuit panels (and District Courts within the Circuit) are not precluded from 

reaching a different result in a future case where that issue is presented in the briefs.20 

In lieu of relying on Cochran, the Community Financial panel understandably resolved the 

case on the basis of the authorities that the parties did place before the Court. One of those 

authorities was the Sixth Circuit’s then-recent decision in Calcutt, where a three-judge panel held 

that the “distinction” between prospective and retrospective remedies “does not matter” in a case 

challenging removability protections. 37 F.4th at 316. That portion of Calcutt—which was cited 

in the key passage of Community Financial—is both incorrect and irreconcilable with the Fifth 

Circuit’s en banc decision in Cochran. In any event, whatever persuasive value Calcutt may have 

had when Community Financial was decided has since been called into grave doubt. After Calcutt 

was decided, the respondent’s counsel applied to the Supreme Court for a stay and argued, among 

20 See Ochoa-Salgado v. Garland, 5 F.4th 615, 619 (5th Cir. 2021); Richardson v. Tex. Sec’y of State, 978 F.3d 220, 

229 n.15 (5th Cir. 2020); Matter of Swift, 129 F.3d 792, 796 n.18 (5th Cir. 1997); Richards v. J.A. Jones Constr. Co., 

782 F.2d 504, 508 n.3 (5th Cir. 1986); Lirette v. N.L. Sperry Sun, Inc., 810 F.2d 533, 538 (5th Cir. 1987), on reh’g en 

banc, 820 F.2d 116 (5th Cir. 1987). 

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other things, that the Sixth Circuit’s opinion had wrongly “disregarded limitations on Collins’s 

reach” by extending Collins’s “proof-of-prejudice requirement even to cases involving 

prospective relief.”21 On September 29, 2022, the Supreme Court recalled the Sixth Circuit’s 

mandate in Calcutt and stayed that decision (and the underlying FDIC order) pending disposition 

of the forthcoming petition for a writ of certiorari. Calcutt v. FDIC, No. 22A255, 2022 WL 

4546340 (U.S. Sept. 29, 2022). The Supreme Court issues such stays only when the applicant is 

“likely to succeed on the merits.” Nken v. Holder, 556 U.S. 418, 426 (2009); see Little v. Reclaim 

Idaho, 140 S. Ct. 2616, 2616 (2020) (Roberts, J., concurring); Trump v. Int’l Refugee Assistance 

Project, 137 S. Ct. 2080, 2090 (2017) (Thomas, J., concurring in part and dissenting in part); 

Merrill v. Milligan, 142 S. Ct. 879, 883 n.1 (2022) (Kagan, J., dissenting). 

The conflict between Community Financial and Cochran is not merely academic, but rather 

has profound consequences for tens of millions of Americans who make a living in industries that 

are subject to regulation by federal agencies. From a practical standpoint, it would be inequitable 

to interpret Collins as applying across the board to requests for prospective relief, even where—as 

here—a plaintiff seeks nothing but forward-looking relief to ensure “an administrative 

adjudication untainted by separation-of-powers violations.” Cochran, 20 F.4th at 210 n.16.22 

Such a holding would make it virtually impossible for any plaintiff to ever receive a meaningful 

remedy in a lawsuit alleging a removability defect. 

21 Application for Stay at 25, Calcutt v. FDIC (No. 22A255) (Sept. 22, 2022), https://bit.ly/3VlEztw (emphasis 

altered). 

22 The government’s brief in Collins acknowledged a material distinction between requests for prospective and 

retrospective relief. The government argued to the Supreme Court that “equitable principles bar[red plaintiffs’] 

belated attempt to unravel a multibillion-dollar contract agreed to by Treasury” (a form of retrospective relief), but 

then noted that this rationale did “not undercut” the portion of the court of appeals’ “judgment awarding a declaration 

that FHFA’s structure violates the Constitution” (a form of prospective relief). Reply & Resp. Br. of the United States 

at 28 & n.*, Collins, 141 S. Ct. 1761 (Nos. 19-422, 19-563), 2020 WL 6322317 (Oct. 23, 2020). 

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As Judge Oldham explained in his six-Judge concurrence in Cochran, “it will be very 

challenging to obtain meaningful retrospective relief for constitutional removability claims 

after Collins,” because plaintiffs pursuing such claims will “need to identify a retroactively 

vindicable harm inflicted by the unconstitutional removal protection.” 20 F.4th at 232-33 

(Oldham, J., concurring). Judge Oldham explained that plaintiffs will seldom if ever be able to 

demonstrate this type of “compensable harm” because “the examples hypothesized by 

the Collins Court, like a public statement that an officer would have been removed but for a 

removal protection, are quite uncommon occurrences.” Id. at 233. Judge Oldham’s concern over 

the difficulty of establishing a “compensable harm” was precisely the reason why he agreed with 

the majority that a plaintiff seeking only prospective relief did not need to show a “compensable 

harm” to succeed on a removability challenge. Indeed, as Judge Oldham explained, 

challengers with meritorious removability claims may often be left without any 

remedy if they are forced to wait until after enforcement proceedings conclude [to] 

bring their claims . . . . A person subject to an unconstitutional adjudication 

should at least be able to sue for declaratory relief requiring a constitutionally 

structured proceeding. After Collins, this may be the only way to provide a 

meaningful avenue of relief for claims like Cochran’s and check the agency’s 

. . . tendency toward exclusive, unimpeded control over the way it investigates and 

proceeds against its targets. 

Id. at 233 (emphasis added) (citations and internal quotation marks omitted). 

In sum, this Court’s Order relied on and applied language from Community Financial in a 

manner that that clearly conflicts with the prior en banc decision in Cochran. The Order should 

therefore be reconsidered. The Court should instead apply the rule announced in footnote 16 of 

Cochran, even if it believes that the interpretation of Collins announced in Community Financial

is more persuasive. See United States v. Tompkins, 130 F.3d 117, 121 n.13 (5th Cir. 1997) (noting 

that, when there is a conflict in Fifth Circuit authorities, judges should follow the earlier decision, 

but may elect to “note [their] concerns” about the division of authority and should feel free to 

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19 

suggest that it may be prudent for the Fifth Circuit to consider the conflict by convening a future 

en banc proceeding). 

II. Alternatively, This Court Can Read Community Financial and Cochran In Concert.

If possible, District Courts should avoid interpreting two Fifth Circuit cases to create a 

conflict or a division of authority. Cf. Hoyt v. Lane Constr. Corp., 927 F.3d 287, 296 n.3 (5th Cir. 

2019) (as revised); see also KH Outdoor, L.L.C. v. City of Trussville, Ala., 366 F. Supp. 2d 1141, 

1145 (N.D. Ala. 2005) (discussing the need to “avoid . . . the complications created by the intracircuit split” where possible), aff’d, 458 F.3d 1261 (11th Cir. 2006). As discussed above, the 

interpretation of Community Financial offered in this Court’s Order places Community Financial

into conflict with Cochran. Rather than adopt that broad reading of Community Financial, this 

Court could reconcile the Fifth Circuit’s precedents by granting reconsideration and holding in a 

new Order that either (1) Community Financial simply does not answer the question presented in 

this case, see infra Section II.A; or (2) that the relevant portion of Community Financial contains 

non-binding dicta that need not be followed, see infra Section II.B.

A. Community Financial Has No Applicability When, As Here, a Plaintiff 

Pressing a Removability Argument Seeks Prospective Relief Only.

The easiest way for this Court to reconcile Community Financial and Cochran would be 

to hold that the discussion of remedies in Community Financial does not constitute binding 

precedent with respect to the particular fact pattern presented in this case—i.e., a situation in which 

the plaintiff seeks only prospective relief and does not request vacatur of any agency action. 

The plaintiffs’ lead argument in Community Financial was that the CFPB’s Payday 

Lending Rule should be vacated because it was promulgated at a time when the agency’s Director 

enjoyed an unconstitutional level of protection from removal. To the extent the plaintiffs sought 

prospective relief at all, that relief was limited to a request for an injunction that would block the 

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20 

agency from enforcing the rule on a going-forward basis due to the removability problem. See 

supra notes 6-7 and accompanying text. Phrased differently, the plaintiffs’ request for prospective 

relief, to the extent there was one, was merely a “request[ for] an injunction against the future 

enforcement of” surviving portions of the Payday Lending Rule. See supra note 11. 

The critical difference between Community Financial and this case is that, in Community 

Financial, the plaintiffs’ request for prospective relief would, by their own admission, stand or fall 

based on whether the Payday Lending Rule was vacated. The Community Financial plaintiffs 

never argued that they would have any entitlement to prospective relief if the Rule was not 

retrospectively vacated; instead, the entirety of their case rested on the notion that the agency 

should be blocked from enforcing the Rule on a going-forward basis because it was unlawful when 

promulgated. See supra note 14 (discussing plaintiffs’ argument that they were “entitle[d] . . . to 

prospective relief” because the CFPB “lacked authority to promulgate the Rule because its director 

at the time was unconstitutionally insulated from removal”). In other words, whether or not the 

Community Financial plaintiffs’ requested relief was conceptualized as “prospective” or 

“retrospective,” they clearly sought to deprive a prior agency action of legal force—to render it 

null and void. By contrast, Burgess has not asked this Court to vacate or set aside any prior action 

of the FDIC, and his entitlement to prospective relief does not depend on this Court doing so. 

Instead, Burgess’s argument is that—regardless of what may have happened in the Enforcement 

Proceeding up to this point—the Defendants should be enjoined from continuing that proceeding, 

including issuing future orders in that proceeding, unless and until the removability defects are 

cured. That requested relief is totally unlike the relief sought in Community Financial. 

From the perspective of the relief sought, this case—unlike Collins and Community 

Financial—is no different from PCAOB, where the Supreme Court held that plaintiffs challenging 

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removability restrictions for officers of the United States were entitled to declaratory relief, and 

did not require the plaintiffs to show any form of compensable harm. 561 U.S. at 491 n.2, 513. 

The Supreme Court explained that the separation-of-powers violation in that case “create[d] a 

‘here-and-now’ injury” and that the plaintiffs were therefore “entitled to declaratory relief 

sufficient to ensure that the reporting requirements and auditing standards to which they are subject 

will be enforced only by a constitutional agency accountable to the Executive.” Id. at 513 (quoting 

Bowsher v. Synar, 478 U.S. 714, 727 n.5 (1986)); see Cochran, 20 F.4th at 233 (Oldham, J., 

concurring). As explained below, the Fifth Circuit confirmed that rule in its en banc decision in 

Cochran, which held that a plaintiff does not need to show a “compensable harm” when he or she 

“does not seek to ‘void’ the acts of any SEC official” but rather “seeks an administrative 

adjudication untainted by separation-of-powers violations.” Id. at 210 n.16 (majority). 

Against the backdrop of PCAOB and Cochran, Community Financial should be read as 

limited to the specific and idiosyncratic facts at issue there. To the extent the Community Financial

plaintiffs pursued a request for prospective relief, that request was tied entirely to their request that 

the Rule be vacated; simply stated, the Community Financial plaintiffs were attacking a prior 

agency action and seeking to deprive it of legal force. Community Financial indicated that, in 

those circumstances, the plaintiff would not be relieved of the obligation to show “compensable 

harm,” because the request for prospective relief was illusory and entirely dependent on the vacatur 

of the rule. Of course, the natural consequence of vacating an administrative rule is that it cannot 

be enforced on a going-forward basis because the Court’s decision means that the world must act 

as if the rule had never existed at all. Cf. Geiger v. Allen, 850 F.2d 330, 332 (7th Cir. 1988) (noting 

that the “legal status” of a vacated order “is the same as if the order had never existed” (internal 

quotation marks omitted)); Wynne v. Rochelle, 385 F.2d 789, 796 (5th Cir. 1967) (similar). There 

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22 

is no difference between (a) requesting that a rule be vacated and (b) requesting that a rule be 

vacated and enjoined on a going-forward basis, because all of the relief requested by (b) is already 

inherent in the relief requested by (a). 

Thus, to the extent Community Financial can be understood as delivering any holding on 

this issue, that holding is best understood as a determination that a plaintiff cannot “dress up” a 

request for retrospective relief as a request for prospective relief to avoid the requirement to show 

“compensable harm.” Otherwise, Collins’s remedial analysis would be a dead letter. 

In short, Community Financial and Collins are both cases that discuss what remedial 

standard should apply when a plaintiff is seeking vacatur of an agency action. That is not what 

Burgess is asking for here, and ergo those cases do not control. Community Financial had no 

occasion to consider whether a plaintiff would be required to show a “compensable harm” in a 

case where, as here, the plaintiff requests only prospective relief, and nothing about the plaintiff’s 

entitlement to prospective relief depends in any way on whether retrospective relief is also 

warranted. Any broader interpretation of Community Financial—such as the one offered in this 

Court’s prior Order—would make that case irreconcilable with the en banc decision in Cochran. 

B. The Portion of Community Financial on Which the Order Relied Was Dicta.

The briefs in Community Financial focused on the question of whether the Payday Lending 

Rule should be vacated, which is a form of retrospective relief. After briefing in Community 

Financial was complete, the parties filed competing Rule 28(j) letters concerning the import of the 

Sixth Circuit’s recent decision in Calcutt. As noted above, the plaintiffs’ letter expressly stated 

that, notwithstanding the arguments they had previously presented to the District Court and in their 

appellate briefs, “th[e] Court need not resolve whether Collins applies to prospective relief.” See 

supra note 16. The plaintiffs insisted in their letter that they had “satisfied Collins by establishing 

that President Trump would have removed Director Cordray,” meaning that the Court could 

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23 

“simply assume arguendo that Collins applies to the relief sought here.” See supra note 17. The 

government interpreted the plaintiff’s invitation to “assume . . . that Collins applies to relief 

sought” as a concession that the Community Financial panel should apply the Collins framework 

to plaintiffs’ entire case, including any request for prospective relief that they might be making. 

Indeed, at the Fifth Circuit oral argument, the CFPB’s attorney rightly noted that the government 

“underst[ood the plaintiffs] to now essentially concede that the Collins framework governs.”23

The Community Financial panel nonetheless went on to hold that “Collins did not rest on 

a distinction between prospective and retrospective relief.” 51 F.4th at 631. But given that the 

plaintiffs had forfeited any contrary argument by affirmatively inviting the panel to “assume 

. . . that Collins applies to the relief sought here,” that portion of the Community Financial opinion 

was dicta. In effect, the plaintiffs’ 28(j) letter operated as a forfeiture of their argument that Collins

did not apply to requests for prospective relief. And it is black-letter law that a federal court’s 

comments on forfeited issues constitute mere dicta.24 Courts in this Circuit need not follow dicta 

in the Fifth Circuit’s opinions. See Felder v. Johnson, 204 F.3d 168, 172 (5th Cir. 2000); U.S. 

Nat’l Bank of Oregon v. Indep. Ins. Agents of Am., Inc., 508 U.S. 439, 463 n.11 (1993). At the 

very least, the Community Financial plaintiffs’ invitation for the court to “assume . . . that Collins

applies to the relief sought here” means that the Fifth Circuit’s acceptance of that invitation does 

not constitute binding precedent. The Fifth Circuit recently explained that a prior “panel’s 

assumption is not binding” when, as here, “the adverse party did not challenge . . . that issue.” 

Ochoa-Salgado v. Garland, 5 F.4th 615, 619-20 (5th Cir. 2021) (emphasis added). 

23 Tr. of Community Financial Oral Argument at 16:12-16:19 (May 9, 2022), https://bit.ly/3X8SzbC. 

24 See, e.g., United States v. Wilson, 776 F.3d 402, 405 (6th Cir. 2015) (analysis of substantive legal issue in prior case 

“was dicta because [the appellant] forfeited the issue on appeal”); Howell Petroleum Corp. v. Samson Res. Co., 903 

F.2d 778, 781 (10th Cir. 1990) (statement in prior opinion was “dicta because the issue had been waived and was not 

before the court”); United States v. Smith, 386 F.3d 753, 761 (6th Cir. 2004) (similar); Bass v. Butler, 116 F. App’x 

376, 383 (3d Cir. 2004) (similar). 

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* * * * * 

Under Cochran, there is no requirement for Burgess to present evidence that the 

unconstitutional removal protections in place at the FDIC have caused him a “compensable harm.” 

Burgess can instead demonstrate an entitlement to a preliminary injunction on Counts 1 and 2 by 

showing that he is likely to succeed on the merits, that he faces a risk of irreparable harm, and that 

the equities favor an injunction. This Court has already concluded that all three of those 

requirements are satisfied here. See Order at 17 (noting that the constitutional claims presented in 

Counts 1 and 2 “have merit”); see id. at 22-23 (concluding that Burgess has shown irreparable 

harm and that the equities favor an injunction). Burgess therefore respectfully requests that this 

Court grant this motion for reconsideration and enter a new Order that grants preliminary 

injunctive relief as to the removability defects discussed in Counts 1 and 2.25

25 On December 1, 2022, this Court entered a preliminary injunction with respect to Count 3. ECF No. 49 at 3-4. The 

Defendants noticed an appeal the following day. See ECF No. 50. In the unlikely event that the government’s appeal 

is successful, the existing injunction would be lifted, and the FDIC would then be free to continue the Enforcement 

Proceeding unless blocked from doing so on some other ground. Issuing a preliminary injunction as to Counts 1 and 

2 is therefore necessary to ensure that the FDIC does not issue a Final Decision in the Enforcement Proceeding in the 

event that the Fifth Circuit were to vacate this Court’s determination that an injunction is warranted as to Count 3. 

Burgess respectfully submits that the proper course of action would be for this Court to enter an Order that (1) grants 

reconsideration as to Counts 1 and 2 for the reasons explained above and (2) calls for supplemental briefing on the 

scope and contours of a future preliminary injunction as to Counts 1 and 2, just as this Court previously did after 

finding that Burgess was entitled to a preliminary injunction as to Count 3. See Order at 24. 

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CONCLUSION 

WHEREFORE, this Court should grant reconsideration and enter a preliminary injunction 

as to Counts 1 and 2 in the Complaint. 

Dated: December 2, 2022 Respectfully submitted, 

 /s/ Manuel G. Berrelez 

James T. Dawson (TX Bar No. 24094618) 

 Pro Hac Vice (DC Bar No. 1602502) 

 Email: jamesdawson@velaw.com 

VINSON & ELKINS LLP 

2200 Pennsylvania Avenue, NW 

Suite 500 West 

Washington, DC 20037 

Telephone: (202) 639-6588 

Facsimile: (202) 639-6604 

 

Manuel G. Berrelez (TX Bar No. 24057760) 

 Email: mberrelez@velaw.com 

Thomas P. Mitsch (TX Bar No. No. 24102218) 

 Email: tmitsch@velaw.com 

James F. Hopper (TX Bar No. 24116535) 

 Email: jhopper@velaw.com 

Madelyn C. Stanley (TX Bar No. 24121529) 

 Email: mstanley@velaw.com 

VINSON & ELKINS LLP 

Trammell Crow Center 

2001 Ross Avenue, Suite 3900 

Dallas, Texas 75201 

Telephone: (214) 220-7700 

Facsimile: (214) 220-7716 

Counsel for Plaintiff Cornelius Campbell Burgess 

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26 

CERTIFICATE OF SERVICE 

I hereby certify that on this 2nd day of December, 2022, I caused the foregoing document 

to be filed with the Clerk of the U.S. District Court for the Northern District of Texas via the 

Court’s CM/ECF system, which will cause notification of such filing to be sent to all counsel and 

parties of record registered to receive such notices. 

Dated: December 2, 2022 Respectfully submitted, 

/s/ Manuel G. Berrelez 

Manuel G. Berrelez (TX Bar No. 24057760) 

 Email: mberrelez@velaw.com 

VINSON & ELKINS LLP 

Trammell Crow Center 

2001 Ross Avenue, Suite 3900 

Dallas, Texas 75201 

Telephone: (214) 220-7700 

Facsimile: (214) 220-7716 

Counsel for Plaintiff Cornelius Campbell Burgess 

Case 7:22-cv-00100-O Document 54 Filed 12/02/22 Page 32 of 33 PageID 903
27 

CERTIFICATE OF COMPLIANCE 

I hereby certify that this document complies with the applicable type-volume limitation 

because it contains no more than 25 pages, which was the length limit set in Civil Rule 7.2(c). 

Dated: December 2, 2022 Respectfully submitted, 

/s/ Manuel G. Berrelez 

Manuel G. Berrelez (TX Bar No. 24057760) 

 Email: mberrelez@velaw.com 

VINSON & ELKINS LLP 

Trammell Crow Center 

2001 Ross Avenue, Suite 3900 

Dallas, Texas 75201 

Telephone: (214) 220-7700 

Facsimile: (214) 220-7716 

Counsel for Plaintiff Cornelius Campbell Burgess 

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