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IN THE UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS

Bureau of Consumer Financial )

Protection, ) Case No. 1:20-cv-04176

)

Plaintiff, )

)

vs. )

)

Townstone Financial, Inc. and )

Barry Sturner )

)

Defendants. )

DEFENDANTS’ COMBINED MOTION TO DISMISS PLAINTIFF’S COMPLAINT

Defendants Townstone Financial, Inc. (“Townstone”) and Barry Sturner (“Sturner”), by 

counsel, and pursuant to Fed. R. Civ. P. 12(b)(6), respectfully move this Court to dismiss the 

amended complaint (the “Amended Complaint”) filed by Plaintiff, Bureau of Consumer Financial 

Protection (the “Bureau”). The grounds for this Motion are further set forth in the Memorandum 

of Law in Support of Defendants’ Combined Motion to Dismiss (“Memorandum”), which is filed 

contemporaneously herewith. As further explained in the Memorandum:

1. The Amended Complaint fails because contrary to the express language used in the 

Equal Credit Opportunity Act (“ECOA”), 15 U.S.C. §§ 1691–1691f, the Bureau and ECOA’s 

implementing Regulation B, 12 C.F.R. § 1002.4(b), improperly seek to:

a. expand the reach of ECOA to reach “prospective applicants”;

b. regulate “discouraging” behavior before a “credit transaction” even exists, 

and;

c. create affirmative advertising and hiring requirements, which cannot be 

squared with the unambiguous language of the statute.

2. Even if such an expansion is appropriate under the statutory scheme, Regulation B 

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and the Bureau’s interpretation thereof runs contrary to the First Amendment of the United States 

Constitution because the Bureau seeks to regulate the content and viewpoint of protected speech 

and does so in a way that is unconstitutionally overbroad and vague, both as applied to Townstone 

and facially. 

3. Similarly, Regulation B and the interpretation thereof are also unconstitutionally 

vague in violation of the Fifth Amendment’s due process clause, both as applied to Townstone and 

facially. 

4. Finally, the derivative claim against Townstone’s owner, Barry Sturner should also 

be dismissed because that claim only becomes relevant if the Bureau succeeds on its claims against 

Townstone, which for reasons articulated herein, it cannot. 

WHEREFORE, for the foregoing reasons and the reasons set forth in their Memorandum, 

Defendants Townstone Financial, Inc. and Barry Sturner respectfully request this Court to dismiss 

the Bureau of Consumer Financial Protection’s Amended Complaint with prejudice and for all 

other relief just and proper in the premises.

Respectfully submitted,

/s/ Sean P. Burke

Sean P. Burke #6277203

E. Brenda Kpotufe #34084-49

Mattingly Burke Cohen & Biederman LLP

155 E. Market St., Suite 400

Indianapolis, IN 46204

Sean.Burke@mbcblaw.com

Brenda.Kpotufe@mbcblaw.com

Marx Sterbcow

Sterbcow Law Group

824 Elmwood Park Blvd #205

New Orleans, LA 70123

marx@sterbcowlaw.com

Attorneys for Defendant Townstone Financial, 

Inc. and Barry Sturner

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CERTIFICATE OF SERVICE

I hereby certify that on February 8, 2021 a copy of the foregoing was filed electronically. 

Service of this filing was also made by operation of the Court’s CM/ECF system:

Barry Reiferson

Vincent Herman 

Michael G. Salemi

Mary E. Olson

Bureau of Consumer Financial Protection

230 S. Dearborn St., Suite 1590

Chicago, IL 60604

And

1700 G Street, NW

Washington, DC 20552

/s/ Sean P. Burke______________

Sean P. Burke

Case: 1:20-cv-04176 Document #: 31 Filed: 02/08/21 Page 3 of 3 PageID #:139