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1: 17-c v -000 49-RC

Filed O n: March 3, 20 17

John Doe Com pan y ,

App ellant

v

.

Consu me r Financia l Prote ction Burea u a nd Richard Co rdray, in his of f icial capa city

as Director of

the Consu me r Financia l Prote ction Burea u,

App ellees

BEFORE: Kavana ugh, Millett, a nd W ilkins, Circuit Jud ges *

O R D E R

Upon con siderat ion o f

the em ergency motio n f or injun ction pen ding ap pea l, the
respo nse the reto, an d th e rep ly , it is

ORDERED tha t th e m otion f or injun ction be den ied.

App ellant Joh n Doe Com pan y is a Ca lifo rnia limite d liab ility com pan y

w ith its principa l place of

bu siness in the Ph ilippines. T he Com pan y is in th e b usine ss of purch asing an d se lling income strea ms. A recen t Go v ernm ent Acco unt ability Of f ice stud y explained tha t inco me -stream -marke ting busin esses of ten target vulnerab le clients su ch a s ou r military v ete rans a nd the elde rly , cha rg ing ef f ective intere st rate s f ar in excess of

stat e u surylaws ( up to 8 7% in som e ca ses) an d p rov iding lum p su m payout s tha t are roughly half the m inimu m required un der f ede ral law gov erning pe nsion s. See U.S. G O V ’ T A C C O U N TA B I L I TY O F F I C E

, GAO-15 -846 T

, P E N S I O N A D V A N C E T R A N S A C TI O N S : Q U E S TI O N A B L E B U S I N E S S P R A C TI C E S I D E N TI F I E D 20– 22, 23 –26 , 27 (201 5). T he GAO Repo rt recom me nde d th at t he Fede ral T rade Com mission an d th e Consu me r Financia l Prote ction Burea u investigate in com e-stream m arkete rs. T he

Circuit Jud ge Kavana ugh would grant t he mo tion f or injun ction pen ding ap pea l * f or th e rea sons set f orth in th e a ttach ed state me nt.

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Com pan y

itself ha s be en the sub ject o f regulato ry

proce edin gs by

at least six

Sta tes und er th eir con sum er prot ection laws. As th e d istrict court f oun d, “n eithe r side se em s to d ispute tha t Joh n Doe Co. h as b een the sub ject o f con siderab le ne gativ e p ublicity throu ghout the pa st f ew y ears.” Dist. Ct. Op . Den y ing Prelim. Inj. 7

.

In No v em ber 2 016 , th e Con sum er Finan cial Prote ction Burea u issue d a Civ il Investigativ e Dem and (“CID” ) to t he Com pan y pu rsuan t to its sta tuto ry au tho rity , 12 U.S.C. § 55 62(c)(1). Con gr ess a uth oriz ed the Bu reau to issue CIDs t o co llect inf orma tion relevant to the en f orcem ent of spe cif ied co nsum er prot ection laws. Id .; see also 12 U.S.C. § 55 11. T he issuan ce o f a CID is p urely inv estigatory. It d oes not initiate a la w -enf orcem ent proce edin g or even signif y tha t an y vi olatio n o f

law has be en

com mitt ed. See 12 U.S.C. § 5 562 (e).

CIDs are n ot se lf -enf orcing, an d n on-co mp liance trig gers no f ine o r pen alty. 12 U.S.C. § 55 62(e )(1); Morgan Drexen , In c. v. Co nsumer Fin. Prot . Bu reau , 97 9 F. Sup p. 2d 104 , 10 8 (D.D.C. 2 013 ), aff’ d

, 785 F.3d 68 4 (D.C. Cir. 20 15). T he Com pan y thu s

nee ded to do not hing in resp onse to the CID it rece iv ed. If a re cipient de clines to
respo nd to t he CID, the Bu reau m ust o bta in a court orde r to e nf orce it. 12 U.S.C. § 5 562 (e). In tha t cou rt proce edin g, the recipien t can raise a ny relev ant legal ob jection to e nf orcem ent of

the CID.

In t his case , th e Com pan y did not w ait f or th e B urea u to see k en f orcem ent of the CID, bu t inste ad f iled a pre-en f orcem ent suit in district co urt ch allenging the const itution ality of

the Bu reau ’s structu re an d se eking to halt any and all Bu reau actio n “adverse” to t he com pan y , Mot. f or Prelim . In j. 26 , includ ing enjoin ing enf orcem ent of the CID an d f orbidd ing the disclosure of the Com pan y ’s iden tity. Th e d istrict court den ied Do e’s request f or a prelimin aryinjun ction, con cluding th at t he Com pan y ha d n ot

me t its b urde n o f

esta blishing eith er a likelihood of succe ss or irrepa rable harm . T he Com pan y

no w requests an em ergency injunction pe ndin g appe al.

A p relimina ry

injun ction is “an e x traordin aryrem edy tha t m ay only be awarded
upo n a clear sh owi ng tha t th e [m ovant] is e ntitled to such relief .” W inter v. Natu ral Res. Def. Co uncil, I nc. , 55 5 U.S . 7, 22 (200 8). “A plaint if f see king a pre limina ry

injun ction

mu st est ablish tha t he is likely to succee d o n th e m erits, th at h e is likely to suf f er irreparab le ha rm in the ab sence of prelim inary relief, tha t th e b alan ce o f equities t ips in his f avor, and tha t an injun ction is in th e p ublic int erest. ” Id. at 20. Be cause the Com pan y

see ks the exception al rem edy of an injun ction pen ding ap pea l, the Com pan y

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f aces the dif

f icult ta sk of

com ing f orw ard with evidence an d a rg um ent sho w ing that it is “likel[y ]” tha t th e d istrict court “a buse d its d iscretion” in den y ing a pre limina ry injun ction. See , e. g.
, W

ashin gto n Met

ro. Are a Tran sit Com m ’ n v. Holiday To urs, In c. , 55 9 F.2 d 841 , 84 4 (D.C. Cir. 19 77); Chap laincy o f Full Go spel Ch urche s v. E ngla nd , 45 4 F.3 d 290 , 29 7 (D.C. Cir. 20 06).

T he Com pan y ’s sole a rg um ent regarding likelihood of succe ss on the m erits bef ore t his cou rt an d th e d istrict court h as b een to poin t to the no w -v acat ed ma jority opin ion in PHH Corpora tion v. Con sum er Finan cial Prote ction Burea u , 83 9 F.3 d 1 (D.C. Cir. 201 6), vacat ed, reh’ g e n b anc gran ted

, No. 1 5-11 77 (D.C. Cir. Feb. 1 6, 2 017 ). Bu t

reme mb er: th e Com pan y ha s to show not just th at t here is po ten tially pe rsuasive aut hority f or its legal p osition , bu t th at t he district cou rt ab used its discret ion in no t suf f iciently crediting tha t sho w ing in the ba lancing of equities t hat prelim inary injunctive relief requires. P ointin g to PHH is no t en ough f or f our rea sons.

First , th e PHH decision on w hich t he Com pan y relies h as b een vacated . A nd even wi thin tha t de cision, p ane l me mb ers dif f ered on the ap prop riaten ess o r nece ssity of issuing the sep aratio n-of -powers ruling giv en pred icate statu tory issues in t he case. PHH , 83 9 F.3 d a t 56 (Hend erson , J., concu rring in p art a nd dissen ting in pa rt) (declining to reach the con stitutio nal que stion beca use an ade quate reme dy could b e provided o n th e sta tuto ry ground ); see also id . at 55 (Rand olph , J., concu rring ) (also f inding con stitutio nal e rror in the AL J w ho hea rd th e p rocee ding). W ithou t suggesting anything on e way

or th e o the r abo ut h ow the e n b anc court might u ltima tely resolv e th e PHH case an d with all du e resp ect t o its p ane l me mb ers, th e d istrict court d id no t ab use its discretio n in det ermin ing that simp ly po inting to the vacated m ajority opinion in PHH did n ot e stab lish the likelihood of an iden tical con stitutio nal ru ling by the en ba nc co urt in PHH or th e co urt in this ca se.

Seco nd , even a ssum ing f or pu rpose s of this m otion tha t th e e n b anc court w ere to re ach the sam e co nstitu tiona l ruling as th e m ajority opinion in PHH , th e Com pan y is not rem ote ly

in th e sa me con stitutio nal p osition as P HH. PHH, rem em ber, w as o n th e receivi ng end of

a co mp leted law enf orcem ent proce edin g by the Bu reau , an d h ad bee n orde red t o p ay a $1 09 million f ine

. PHH , 83 9 F.3 d a t 7. In f inding a sepa ration -of

powers v iolation , th e m ajority opinion repe ate dly emp hasized its view of the Constitu tion’s a ssignmen t of “law en f orcem ent ” aut hority to th e E x ecut iv e B ranch

. See

, e.g

. , id. at 18 (discussing “the core A rticle II e x ecut iv e p ower of bringing law enf orcem ent actio ns”); id. at 19 (Social S ecurity Adm inistrato r distinguisha ble b ecau se

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he “doe s no t po ssess u nilate ral au tho rity to bring law

en f orcem ent actio ns a gainst priv ate citiz ens, w hich is t he core o f the executive power and the prima ry thre at t o individual liberty pose d b y executive power”) ; id. at 20 n.5 (court’s h olding would no t invalidate o the r single-director inde pen den t agen cies be cause the y “do not exercise the

core e x ecut iv e p ower of bringing law

en f orcem ent actio ns”).

T he Com pan y , by cont rast, f iled a pre-en f orcem ent suit t o sto p a no n-self

executing investigativ e d em and f or regulato ry inf orma tion. T he Com pan y voices no obje ction here to the scop e o r cont ent of the CID an d d oes not argue t hat it f alls be y ond the Bu reau ’s statu tory auth ority . T he Com pan y ’s sole a rg um ent is tha t th e B urea u’s single-Di rector stru cture is unco nstitu tiona l. An d th e so le injury it asserts o n a ppe al is the ha rm o ccasion ed by having to respo nd to a no n-self -ex ecut ing CID. 1

Sta ndin g is dete rmine d o n a claim -by -claim b asis. See , e. g.
, Davis v. FEC , 55 4 U.S. 7 24, 73 4 (20 08) (explaining th at st and ing is not “dispen sed in gross” but a p laintif f “must de mo nstrat e sta ndin g fo r each claim he see ks to press a nd f or ea ch f orm of relief tha t is sou ght”) (q uot ation m arks an d cita tions om itted ). An d th e o nly thing that hap pen ed prior to the Com pan y f iling its pre-enf orcem ent suit was the Bu reau ’s issuan ce o f

an investigativ e d em and f or inf orma tion relevant to the Com pan y ’s adh eren ce to f ede ral law . T he Com pan y acco rdingly

ha s to dem onst rate tha t th e a ction of m erely req uest ing inf orma tion f rom priv ate en tities su bject to re gulation is by itself exclusiv ely conf ined to the Executive Branch , an d th us th at issu ance of this CID b y

the Burea u violates t he sepa ration of po w ers.

T he Com pan y

ha s utt erly

f ailed tha t ta sk. Nowhere in its argum ent s ha s it even ackno w ledged the distinct po sture of its pre em ptive proce edin g or the na ture of the
gov ernm ent al act ion it seeks to h alt. T hat f ailure t o e v en atte mp t to discha rg e its particu lariz ed burd en of proo f is f ata l. T o o bta in an injun ction pen ding ap pea l on the
gr oun d th at t he Burea u tra nsgresses th e se para tion of po w ers just by issuing a CID—just by investig ating a regulated en tity’ s com pliance w ith f ede ral law —the Com pan y

w ould ha v e to sho w

tha t only

the Executive Branch can de ma nd inf orma tion f rom regulated bu sinesse s or ta ke su ch investigativ e ste ps. T hat is, to say the least, f ar f rom const itution ally

self -ev iden t. Co ngress issues subp oen as f or inf orma tion. An d in Buckle y v. V

aleo , 41 4 U.S . 1 (197 6), th e S upre me Court specif ically carved ou t such

Nor d oes the Com pan y ob ject to an y

oth er regulato ry

m easu re ta ken by the 1 Burea u, o r iden tif

y in its in junctio n p ape rs oth er regulato ry bu rden s to w hich it obje cts. Cf. St ate Nat’

l Ban k of Big S

pring v. Le w , 79 5 F.3 d 4 8, 5 3 (D.C. Cir. 20 15).

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investig ative me asure s f rom its ho lding tha t th e Com mission the re w as e x ercising powers f orbidd en by the Co nstitu tion, id . at 13 7–1 38.

T hat the Com pan y f rame s its argume nt as a f acial challen ge to the Burea u’s ability to take any “action adverse to Plaint if f ” doe s not save it, even assum ing it has stan ding to seek such sw eep ing re lief at this pre-en f orcem ent junctu re on the basis o f no thing ot her tha n the issuan ce of a CI D. A statu te is not f acially unco nstitu tiona l unle ss it is

unco nstitu tiona l in all of its app lications. See

, e.g

. , United Sta tes v. Sale rno
, 481 U.S. 739

, 745 (198 7) (“A f acial challen ge to a legislativ e Act is, of course
, the mo st dif f icult challen ge to mo unt s u c c e s sf ully

, since the challen ger mu st esta blish tha t no set of circumsta nces exists und er w hich the Act w ould be v alid.”). Giv en tha t, the district court certain ly did not abu se its discretion in conclu ding tha t the Com pan y ’s f ailure to even argue its ow n alleged const itution al injury (rather tha n PHH’s) me ant it had not esta blished a likelihood of

success on app eal.

Third

, the Com pan y ’s argume nt tha t the alleged sepa ra t ion-of -powers v iolation

re qu ir e s tha t the Burea u be stop ped in its tracks ignores traditio nal const raints on sepa ration -of -powers reme dies. Of ten in sepa ration -of -powers cases, s e v eran ce of the

unc o nstitu tiona l provisi on is the chose n reme dy. T hat is w hat the now-v acat ed ma jority opin ion in PHH did—th e decision just severed the Director’s f or-cause remo v al provisi on,

ma king him remo v able by the Preside nt at w ill. As the opin ion repe ate dly s t a t e d

, the Burea u could cont inue its w ork apa ce. See , e. g.
, PHH , 83 9 F.3 d a t 8 (declining to “shut down the ent ire CFPB”); see also Free Ent er. Fund v. Pub lic Co. Accou nting Oversigh t Bd.

, 561 U.S. 477

, 509 (201 0) (sev ering unco nstitu tiona l provisi on requiring f or-cause remo v al of of f icers); Buckle y , 424 U.S. at 142 (allow ing the FEC to cont inue its investig ation s and adm inistrative action s even th ough it w as u ncon stitutio nally structured ).

In a dditio n, vacatu r of

pa st act ions is n ot ro utine . T he PHH decision did not undo the Burea u enf orcem ent action and ma ke it s t a rt over f rom scratch. T he court simp ly

rema nde d f or the Burea u to add ress specif ied ma tters. See PHH

, 839 F.3d at 8. Ind eed

, the Sup reme Court and this court have of ten accord ed v alidity to past acts of

unco nstitu tiona lly structu red gov ernm ent al agencies. See

, e.g

. , Buckle y , 424 U.S. at 142 ; Citiz ens for Aba tement of Aircraft Noise, Inc. v. Metropo litan W ash. Airports A u t h

. , 9 1 7 F.2d 48, 57 (D.C. Cir. 199 0) (“W e direct, howev er, that action s take n by the Boa rd to this dat e not be invalidated aut om atically on the basis of our decision .”), aff’ d

, 501 U.S. 252 (199 1); see also In re App lica tion of Preside nt’ s Com m ’ n on Organ iz ed Crim e
, 763 F.2d 119 1, 120 2 (11th Cir. 198 5) (Fay

, J., w riting sepa rately) (“[O]ur hold ing regarding t h e

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sepa ration of powers doct rine does not require the v oiding” of a Com mission subp oen a); id. (Roney, J., specia lly concu rring ) (agreeing w ith decision to enf orce the subp oen a desp ite co nstitu tiona l inf irmity)

.

Giv en all of tha t, the Com pan y f ailed to ma ke any relevant showing at all tha t it has

a likelihood of succee ding on its ef f ort to pr event the Burea u f rom investig ating the

com pan y v ia a CID or taking any oth er unsp ecif ied adverse action

. Or at least the district court did n ot a buse its discret ion in so co nclud ing.

Fourth

, the Com pan y ’s prosp ects of success stumb le in y et ano the r respe ct: this court is not the prop er f orum f or the Com pan y to press its sepa ration of powers claim. W e have held on mu ltiple occasio ns tha t, even if a part y is the subje ct of an arguably

unco nstitu tiona l regulatory action

, tha t const itution al argume nt shou ld be raised w ithin the cont ext of an adm inistrative enf orcem ent proce edin g. See

, e.g

. , Jarkesy v. SEC

, 803 F.3d 9, 12 (D.C. Cir. 201 5); Morgan Drexen

, 785 F.3d at 694 ; cf. Thu n d e r B a sin Coal Co. v. Reich

, 510 U.S. 200

, 215 –21 6 (199 4) (holdin g tha t pet itione r’s const itution al claims could f irst be brou ght be f ore t he agency).

T he Com pan y not es tha t, in Free Ent erprise

, the Sup reme Court perm itted a stan dalon e, pre-en f orcem ent const itution al challen ge. T rue eno ugh. But the Sup reme Court did so the re beca use, to do oth erw ise, could have “f oreclose [ d ] a ll me anin gfu l judicial

rev iew [.]” Free Ent erprise

, 561 U.S. at 489 (q uot ing Thun der Basin

, 510 U.S. at 212 –21 3). T he Com pan y , by cont rast, h as im me diate acce ss to ano the r f orum in w hich it can raise its const itution al claim: the enf orcem ent action pen ding in the United Sta tes District Court f or the Centra l District of Calif ornia. T he Com pan y has ma de no argume nt w hat soever tha t requiring it to raise its claim in an actu al e n f o rc e m e n t proce edin g w ould som eho w “f oreclose all m ean ingfu l judicial review ,” id.

Also, unlike the plaint if f s in Abb ott Lab orato ries v. Gardn er
, 387 U.S. 1 3 6 (1 967 ), the Com pan y has not iden tif ied any exception al me asure s it mu st und ertake in respo nse to the CID. In f act

, a s n ote d, no action at all is required unle ss and unt il the CID is enf orced

. T hus, unlike Abb ott Lab orato ries or Sta te Stree t

, the Com pan y has com e to this court to halt an agency action tha t requires not hing on its part, and certain ly doe s not f orce it to “bet the f arm, ” Free E nte rprise , 56 1 U.S . at 49 0.

W ith respe ct to its obligation to dem onst rate irreparab le harm

, the Com pan y starte d

w ith the ent irely unsu bs t a n t ia t e d and conclu sory assertio ns tha t its custo me rs and

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em ployees w ill f lee and its repu tatio n w ill be ma terially harm ed if w ord of the B u re au’s investi ga t io n gets out

. T ellingly

, the Com pan y doe s not suggest tha t custo me rs or

em ployees def ecte d af ter six state regulatory investig ation s, an adverse GAO repo rt, and the “ consid erab le negativ e publicity” that has already surroun ded the Com pan y , Dist. C t. Op. Denying Prelim. Inj. 7. T he district court thu s did not abu se its discretion in f inding tha t the Com pan y ’s conclu sory assertio ns of repu tatio nal and econ om ic harm

, una ccom pan ied by any relevant decla ration s, did not esta blish an injury tha t is “both certain and gr eat ; * * * actu al and not the oretica l.” W isconsin Gas Co. v. FERC

, 758 F.2d 669

, 674 (D.C. Cir. 198 5). In any event, it is “w ell s e t t le d t h a t e c o nom ic loss doe s not

, in and of itself

, const itute irreparab le harm ,” id

. at 674

, espe cially w hen it is not hing mo re tha n specu lation abo ut how third partie s might respo nd to routin e regulatory investig ation s. For tho se sam e

reaso ns, the Com pan y has f ailed to dem onst rate w hy the district court abu sed its discretion in hold ing tha t its nam e nee d not be kept conf iden tial in pub lic court proce edin gs. Ind eed

, the Com pan y has of

f ered this court no answer to the poin t tha t its iden tity could read ily be obt aine d th rough a Freed om of Inf orma tion Act, 5 U.S .C. § 552 , request

.
By its reply brief in this court ( see Reply Br. 10 & n.2 ), the Com pan y aba ndo ned any f urthe r def ense of tho se asserte d repu tatio nal and econ om ic harm s, put ting all of its eggs in the per se baske t: the Com pan y insists tha t any alleged sepa ration -of -powers injury is by its v ery

nature irr epa rable. T he short answer is that this Co urt h as held othe rw ise. In the abse nce of “imm edia te or ongoing harm stem min g f rom the [Bu reau ’s] alleged const itution al def ects,” the “v iolation of sepa ration of powers” by itself is not invari ably an irreparab le injury

. In re al-Nashiri

, 791 F.3d 71, 79– 80 (D.C. Cir. 201 5); see also Morgan Drexen

, 785 F.3d at 695 n.3 (b eing f orced to await an enf orcem ent proce edin g and to litig ate in ano the r f orum w here no gr e a t e r b urde n is imp osed is not irreparab le injury ); Tilton v. SEC

, 824 F.3d 276

, 2 86 (2d Cir. 201 6) (holdin g, in App ointm ent s Clause challen ge to SEC judges, tha t the injury of “‘being subje cted to a n unco nstitu tiona l adju dicative proce dure ,’ w ith t h e a tten dan t ‘em barrassm ent

, expense
, * * * orde al, * * * [an d] state of anxiety and in security’” w as not an “irr em edia ble harm ”) (alteratio ns in origi nal; citation om itted ).

T hat is dou bly so here w here the only conse quence of den y ing a n in ju n ction
pen ding app eal in the Com pan y ’s pre-en f orcem ent suit is tha t it mu st raise its sepa ration

of -powers argume nts in the pen d in g CID enf orcem ent action in district court. As the Sup reme Court has explained

, “the expens e and disrupt ion of def end ing [on eself ] in protract ed adju dicato ry proce edin gs” is not an irreparab le harm

. FTC v. Sta nda rd Oil Co. of Cal.

, 449 U.S. 232

, 244 (198 0); see also Rene got iation Bd. v. Ban nercraft Clothing Co.

,

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415 U.S. 1, 24 (198 0) (“M ere litig ation expense
, even subst ant ial and unre coup able cost, doe s not con s t it ute irreparab le injury .”). T hat is beca use, if f oun d to be const itution ally

w arrante d, “[v ]aca tur, even at the app eal-f rom-f inal-judgme nt stage, w ould f ully v indicat e” the sep aratio n-of -powers rig hts of the Com pan y

. In re al-Nashiri , 79 1 F.3 d a t 80 1. T he Com pan y has of

f ered this c o u rt n o argume nt as to w hy such prece den t doe s not app ly here

, or mo re to the poin t, w hy it w as not an abu se of discretion f or the district court to f ind

no irreparab le ha rm u nde r the se sp ecial circum stan ces.

Giv en the Com pan y ’s f ailure to esta blish a likelihood of success on the me rits of its
pre-en f or c em en t c ha l l en g e and irreparab le harm

, the bala nce of equities—esp ecially w hen it comes to consu me r prote ction—weighs against g rantin g an injunct ion pen ding appea l.

For the f oregoing reaso ns, t he mo tion f or an injun ction pen ding ap pea l is den ied.

Per Curiam

FOR THE COURT:

Mark J. La nger, Clerk

BY: /s/ Am y Yacisin Depu ty Cl erk

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## No. 17-5026 September Term, 2016

K A V A N A U G H , C

ir c u it J u d g e , d is s e n ti n g :

I w o u ld g r a n t th e m o ti o n f

o r a n in ju n c ti o n p e n d in g a

p p e a l.

P e ti ti o n e r J o h

n D o e C o m

p a n y c la im s th a

t it is b e in g r e g

u la te d b y a n u n c o n s ti tu ti o n a ll y

s tr u c tu r e d a g e n c y , th e C o n s u

m e r F in a n c ia l P r o te c ti o n B u

r e a u

. T h e C F P B h a s is s u e d b in d in g r u le s th a t g o v e r n th e C o m p a n y ’ s c o n d u c t, a n d th e C F P B c a

n b r in g e n f

o r c e m e n t a c ti o n s a g a in s t th e C o m p a n y f o r v io la ti o n s o f th o s e r

u le s ( o r o f s ta

tu te s )

. U n d e r th e S u

p r e m e C o u

r t’ s a n d th is C o u

r t’ s p r e c e d e n ts
, th e C o m

p a n y a s a r e g u la te d e n ti ty h a s s ta

n d in g to r a is e it s f

r e e

- s ta n d in g c o n s ti tu

ti o n a l

c la im

, a n d th e c la im is r ip e

. T h e C o m p a n y n e e d n o t w a it f

o r a C F P B e n f

o r c e m e n t a c ti o n in o r d e r to

r a is e th e c o n s ti tu

ti o n a l c h a ll e n g e

. S

e e F r e e E n te r p r is e F u n d v

. P u b li c C o m p a n y A c c o u n ti n

g O v e r s ig h t B o a r d

, 5 6 1 U

. S

. 4 7 7

, 4 9 0 ( 2 0 1 0 ) ; A b b o tt L a b o r a to r ie s v

. G a r d n e r , 3 8 7 U

. S

. 1 3 6

, 1 5 2

- 5 3 ( 1 9 6 7 ) ; S ta te N a ti o n a l B a n k o

f B ig S p r in g v

. L e w , 7 9 5 F

. 3 d 4 8

, 5 3

- 5 4 ( D

. C

. C ir

. 2 0 1 5 )

. “ T o u s e th e S u p r e m e C o u

r t’ s w o r d s , w e ‘ n o r

m a ll y d o n o t r e q

u ir e p la in ti f f s to b e t th e f

a r m ’ b y v io la

ti n g th e la w in o r d e r to c h a ll e n g e th e c o n s ti tu ti o n a li ty o f th e r e g

u la ti n g a g e n c y

. ” S

ta te N a ti o n a l B a n k o

f B ig S p r in g , 7 9 5 F

. 3 d a

t 5 4 ( q u o ti n g F r e e E n te r p r is e F u n d

, 5 6 1 U

. S

. a

t 4 9 0 ( in te r n a l q u o ta ti o n m a r k s

o m it te d) )

. I n d e e d

, th is C o u

r t h a s a lr e a d

y h e ld th a t a b u s in e s s m a

y b r in g a s ta

n d

- a lo n e c o n s ti tu

ti o n a l

c h a ll e n g e to th e s tr

u c tu r e o f th e C F P B

– a

n d th a t c a s e is n o w p e n d in g in th e U

. S

. D is tr ic t C o u r t f o r th e D is tr ic t o f C o lu

m b ia

. S e e id

. a t 5 3

- 5 4

.

I n o r d e r to o b ta in a p r e li m in a r y in ju n c ti o n o r in

ju n c ti o n p e n d in g a

p p e a l, th e C o m

p a n y m u s t

s h o w , a s r e le v a

n t h e r e , ( i) a li k e li h o o d o f s u c c e s s o n th e m e r it s a n d ( ii ) ir r e p a r a b le h a r m

.

I n m y v ie w , th e C o m

p a n y h a s s h o w

n a li k e li h o o d o f s u c c e s s o n th e m e r it s o f it s

c o n s ti tu ti o n a l c la im

, f

o r r e a s o n s f

u ll y e x p la in e d in th is C o u

r t’ s o p in io n in P

H H C o r p

. v

. C F P B

, 8 3 9 F

. 3 d 1 ( D

. C

. C ir

. 2 0 1 6 )

. T h e “ C F P B ’ s s tr u c tu r e v io la te s A r ti c le I I o f th e C o n s ti tu

ti o n b e c a u s e th e C F P B o p e r a

te s a s a n in d e p e n d e n

t a g e n c y h e a d e d b y a s in g le D ir e c to r

. ” I d

. a t 1 2

. T h e C F P B ’ s

s tr u c tu r e a s a s in g le

- D ir e c to r in d e p e n d e n t a g e n c y w it

h v a s t r u le m a k in g a n d e n f o r c e m e n t a u th o r it y is

u n p r e c e d e n te d in A m e r ic a n h is to r y

. T o b e s u

r e , th e P H H c a s e w il l s o o n b e r e h e a

r d b y th is C o u

r t e n b a n c

. B u t in m y v ie w , th e C F P B ’ s s tr

u c tu r e is u n c o n s ti tu ti o n a l. A n d g iv e n th e S u

p r e m e C o u

r t’ s A r ti c le I I p r e c e d e n

ts
, I b e li e v e th a

t th e C F P B ’ s s tr

u c tu r e is li k e ly to b e r

u le d u n c o n s ti tu ti o n a l,

w h e th e r b y th is C o u

r t s it ti n g e n b a n c o r b y th e S u

p r e m e C o u

r t. T h e C o m

p a n y h a s s h o w

n a li k e li h o o d

o f s u c c e s s o n th e m e r it s

.

T h e C o m p a n y a ls o h a s s h o w

n ir r e p a r a b le h a r m

. I r r e p a r a b le h a r m o c c u r s a lm o s t b y d e f

in it io n

w h e n a p e r s o n o r e n

ti ty d e m o n s tr a

te s a li k e li h o o d th a

t it is b e in g r e g

u la te d o n a n o n g o in g b a s is b y a

n

u n c o n s ti tu ti o n a ll y s tr

u c tu r e d a g e n c y th a

t h a s is s u e d b in d in g r

u le s g o v e r n in g th e p la in

ti f f ’ s c o n d u c t

a n d th a t h a s a u th o r it y to b r in g e n f

o r c e m e n t a c ti o n s a g a in s t th e p la in

ti f f

. S e e G o r d o n v

. H o ld e r , 7 2 1

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## No. 17-5026 September Term, 2016

F

. 3 d 6 3 8

, 6 5 3 ( D

. C

. C ir

. 2 0 1 3 ) ( “ A lt h o u g h a p la in ti f f s e e k in g e q

u it a b le r e li e f m

u s t s h o w a th

r e a t o f

s u b s ta n ti a l a n d im m e d ia te ir r e p a r a b le in ju r y , a p r o s p e c ti v e v io la

ti o n o f a c o n s ti tu

ti o n a l r ig h t

c o n s ti tu te s ir r e p a r a b le in ju r y f o r th e s e p u

r p o s e s

. ” ) ( a lt e r a

ti o n a n d in te r n a l q u o ta ti o n m a r k s o m it te d) ( q u o ti n g D a v is v

. D is tr

ic t o f C o lu m b ia

, 1 5 8 F

. 3 d 1 3 4 2

, 1 3 4 6 ( D

. C

. C ir

. 1 9 9 8 ) ) ; s e e a ls o N a ti o n a l F e d e r a ti o n o f F e d e r a l E m p lo y e e s

- I A M v

. V il s a c k

, 6 8 1 F

. 3 d 4 8 3

, 4 9 9 ( D

. C

. C ir

. 2 0 1 2 ) ; M il ls v

. D is tric t o f C o lu m b ia

, 5 7 1 F

. 3 d 1 3 0 4

, 1 3 1 2 ( D

. C

. C ir

. 2 0 0 9 ) ; C h a p la in c y o f F u ll G o s p e l C h u r c h e s v

. E n g la n d

, 4 5 4 F

. 3 d 2 9 0

, 3 0 3

- 0 4 ( D

. C

. C ir

. 2 0 0 6 ) ; c f. F r e e E n te r p r is e F u n d

, 5 6 1 U

. S

. a

t 4 9 0

- 9 1 ; C o r r e c ti o n a l S e r v ic e s C o r p

. v

. M a le s k o , 5 3 4 U

. S

. 6 1

, 7 4 ( 2 0 0 1 )

.

T h e C F P B a

r g u e s th a t, e v e n if th e a g e n c y is u

n c o n s ti tu ti o n a ll y s tr

u c tu r e d u n d e r A r ti c le I I

, th e

r e m e d y f o r th e A r ti c le I I v io la

ti o n w o u ld b e to s e v e r th e f o r

- c a u s e r e m o v a l p r o v is io n , a s P H H h e ld

. I n th a t s c e n a r io

, th e C F P B w o u ld c o n

ti n u e to r e g u la te th e C o m

p a n y , a lt h o u g h th e C F P B w o u ld d o s o

a s a n e x e c u ti v e a g e n c y in s te a d o f a

n in d e p e n d e n

t a g e n c y

. A c c o r d in g to th e C F P B

, th e C o m p a n y th e r e f o r e is n o t e n

ti tl e d to a p r e li m in a

r y in ju n c ti o n o r in

ju n c ti o n p e n d in g a

p p e a l to p r e v e n

t th e C F P B in it s c u r r e n t f o r m f r o m r e g u la ti n g th e C o m

p a n y n o w

. T h e C F P B ’ s a

n a ly s is o n th is p o in

t is b a d ly

m is ta k e n

. U n le s s a n d u n ti l th a t r e m e d y is p u t in p la c e a

n d th e f o r

- c a u s e r e m o v a l p r o v is io n is a c tu a ll y

s e v e r e d f r o m th e s ta

tu te
, th e C o m

p a n y w il l c o n ti n u e to b e r e g

u la te d o n a n o n g o in g b a s is b y a

n

u n c o n s ti tu ti o n a l a g e n c y

. W

h a t th e C o m p a n y o b je c ts to is n o t m e r e ly r e g

u la ti o n b y th e C F P B

, b u

t

r a th e r r e g u la ti o n b y th e C F P B in it s c u

r r e n t u n c o n s ti tu ti o n a l a n d u n p r e c e d e n te d s tr u c tu r e

– n a m e ly

, a n in d e p e n d e n

t a g e n c y h e a d e d b y a s in g le D ir e c to r w h o is u n a c c o u n ta b le to th e P r e s id e n

t o r to a n y f e ll o w c o m

m is s io n e r s

. A p r e li m in a

r y in ju n c ti o n w o u ld a ll e v ia

te th a t o n g o in g h a

r m

.

T h e C F P B ’ s p r im a

r y s tr a te g y to d e f e a t th e C o m p a n y ’ s ir r e p a r a b le h a r m a r g u m e n t is d e f le c ti o n

. T h e C F P B s a

y s th e r e is n o ir

r e p a r a b le h a r m b e c a u s e o th e r c o u

r ts ( th e C e n

tr a l D is tr ic t o f C a li f o r n ia a n d u lt im a te ly th e N in

th C ir c u it ) c a

n e n te r ta in th e C o m

p a n y ’ s c o n s ti tu

ti o n a l a r g u m e n ts in

a c h a ll e n g e to th e c iv

il in v e s ti g a ti v e d e m a n d is s u e d to th e C o m

p a n y b y th e C F P B

. T h e C F P B ’ s

a r g u m e n t m a k e s li tt le s e n s e , in m

y v ie w

. A p a

r ty s e e k in g a p r e li min a

r y in ju n c ti o n in o n e c o u

r t is n o t b a r r e d f r o m o b ta in in g th e p r e li m in a r y in ju n c ti o n s im

p ly b e c a u s e s o m e o th e r c o u

r t mig h t s o m e d a y g r a n t r e li e f to th a

t p a r ty

. T o b e s u

r e , if th is C o u

r t la c k e d ju

r is d ic ti o n o r s ta

tu to r y a u th o r it y to h e a r th is c a s e a t th is ti m e , w e c o u ld n o t g

r a n t a p r e li min a

r y in ju n c ti o n

. B u

t if th is C o u

r t h a s ju r is d ic ti o n

a n d s ta tu to r y a u th o r it y to h e a r a c a s e ( a s w e d o h e r e , s e e F r e e E n te r p r is e F u n d

, 5 6 1 U

. S

. a

t 4 8 9

- 9 1 )

, th e n a p a r ty ’ s c la im o f ir

r e p a r a b le h a r m in th e p r e li m in a

r y in ju n c ti o n c o n

te x t is n o t d e f

e a te d b y th e

m e r e f a c t th a t th e p a r ty ’ s c o n s ti tu

ti o n a l c la im s c o u ld a ls o e v e n tu a ll y b e r a is e d in a

n o th e r c o u

r t.

F in a ll y , th e o th e r tw o f

a c to r s a ls o s u

p p o r t a p r e li m in a

r y in ju n c ti o n

. T h e C o m

p a n y h a s s h o w

n th a t a n in ju n c ti o n “ is in th e p u

b li c in te r e s t” a n d th a t th e “ b a la n c e o f e q u it ie s ti p s ” in it s f

a v o r

. W in te r

v

. N a tu r a l R e s o u r c e s D e fe n s e C o u n c il

, I n c

. , 5 5 5 U

. S

. 7

, 2 0 ( 2 0 0 8 )

. T h e p u b li c in te r e s t is n o t s e r

v e d b y le tt in g a

n u n c o n s ti tu ti o n a ll y s tr

u c tu r e d a g e n c y c o n

ti n u e to o p e r a

te u n ti l th e c o n s ti tu

ti o n a l f la w is

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## No. 17-5026 September Term, 2016

f ix e d

. A n d in th is c ir c u

m s ta n c e , th e e q

u it ie s f a v o r th e p e o p le w

h o s e li b e r ti e s a r e b e in g in f

r in g e d

, n o t th e u n c o n s ti tu ti o n a ll y s tr

u c tu r e d a g e n c y

.

I r e s p e c tf u ll y d is s e n

t f r o m th e C o u

r t’ s d e n ia l o f th e m o ti o n f

o r a n in ju n c ti o n p e n d in g a

p p e a l.

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