Court Opinion

ID: 4512449
Source: CourtListenerOpinion
Date Created: 2020-03-04 01:00:27.802679+00
Date Added: 2024-06-11T09:38:52.872358
License: Public Domain

Case: 18-60302   Document: 00515331067        Page: 1   Date Filed: 03/03/2020

        IN THE UNITED STATES COURT OF APPEALS
                 FOR THE FIFTH CIRCUIT
                                                                  United States Court of Appeals
                                                                           Fifth Circuit

                                                                         FILED
                                    No. 18-60302                     March 3, 2020
                                                                    Lyle W. Cayce
CONSUMER FINANCIAL PROTECTION BUREAU,                                    Clerk

             Plaintiff - Appellee

v.

ALL AMERICAN CHECK CASHING, INCORPORATED; MID-STATE
FINANCE, INCORPORATED; MICHAEL E. GRAY, Individually,

             Defendants - Appellants

                Appeal from the United States District Court
                  for the Southern District of Mississippi

Before HIGGINBOTHAM, SMITH, and HIGGINSON, Circuit Judges.
STEPHEN A. HIGGINSON, Circuit Judge:
      In Collins v. Mnuchin, our court was explicit that its holding on the
constitutionality of the FHFA’s structure was not inconsistent with the D.C.
Circuit’s holding in PHH Corp. v. CFPB, 881 F.3d 75 (D.C. Cir. 2018). See
Collins, 896 F.3d 640, 672–74 (5th Cir. 2018); Collins, 938 F.3d 553, 588 (5th
Cir. 2019) (en banc) (reinstating the relevant portion of the Collins panel
majority decision). Persuaded by the thoughtful and reasoned analysis of that
circuit and the Ninth Circuit, which addressed the same question in CFPB v.
Seila Law LLC, 923 F.3d 680 (9th Cir. 2019), cert. granted, 140 S. Ct. 427
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(2019), I conclude that the restrictions on the President’s removal authority
under the Consumer Financial Protection Act are valid and constitutional.
      The issue is both fundamental and contestable, and it is not an issue that
has been clearly answered by existing Fifth Circuit precedent, though I am
persuaded that our existing precedent does not compel a contrary conclusion.
See Collins, 896 F.3d at 673 (highlighting the “salient distinctions” between
the CFPB and the FHFA that make the court’s reasoning in Collins consistent
with the reasoning in PHH). Therefore, I look forward to its likely resolution
by the Supreme Court. As my colleagues are aware, my own preference in this
specific, post-Collins case would have been to hold our matter several months
in abeyance. 1 That preference was unpersuasive for reasons I respect and,
indeed, I now am confident that views they may choose to elaborate will offer
new insights to the Supreme Court.
      Three circuits have now weighed in on this important question, and the
Supreme Court will benefit from those perspectives, as well as the
comprehensive and well-reasoned brief of court-appointed amicus curiae.
Given the many eloquent voices that have spoken on this question—in
majority, concurring, and dissenting opinions—I see little reason to “re-plow
the same ground here,” Seila Law, 923 F.3d at 682.
       Thus, finding that neither the text of the Constitution nor the Supreme
Court’s previous decisions support the Appellants’ arguments that the CFPB
is unconstitutionally structured, the district court is AFFIRMED.

      1  As I emphasize in my opening sentence, the constitutionality of the CFPB’s removal
provision was left open by the Collins majority, notwithstanding the contrary viewpoint
expressed by my dissenting colleague. I would also add that there would have been no need
for this panel’s intercession had the court chosen to place this case in abeyance until the
Supreme Court decides the identical issue that it heard today.
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                                       No. 18-60302
PATRICK E. HIGGINBOTHAM, Circuit Judge, joined by STEPHEN A.
HIGGINSON, Circuit Judge, concurring:

         In the wake of the 2008 financial crisis, a special commission formed by
Congress found that “failures in financial regulation and supervision” had
“proved devastating to the stability of the nation’s financial markets.” 1 The
consumer-protection system, with its “seven different federal regulators,” was
“too fragmented to be effective.” 2 Congress concluded that in the run-up to the
recession these regulators “had failed to prevent mounting risks to the
economy, in part because [they] were overly responsive to the industry they
purported to police.” 3
         Congress responded. It created the Consumer Financial Protection
Bureau (“CFPB” or the “Bureau”), “a new, streamlined independent consumer
entity housed within the Federal Reserve System.” 4 In placing the federal
consumer-financial protection apparatus under the roof of a single agency with
civil     enforcement     power,    Congress      sought     increased      accountability,
consistency, and escape from regulatory capture, ultimately ensuring “that
markets for consumer financial products and services are fair, transparent,
and competitive.” 5
         To that end, the Consumer Financial Protection Act (“CFPA”) created
the Bureau and tasked the new entity with “implement[ing] and, where
applicable, enforc[ing]” eighteen preexisting consumer-protection statutes. 6 It
also charged the Bureau with taking enforcement actions against “unfair,

         NAT’L COMM’N ON THE CAUSES OF THE FIN. & ECON. CRISIS IN THE U.S., FINANCIAL
         1

CRISIS INQUIRY REPORT, at xviii (2011).
       2 S. REP. NO. 111-176, at 10 (2010).
       3 PHH Corp. v. CFPB, 881 F.3d 75, 77 (D.C. Cir. 2018) (en banc).
       4 S. REP. NO. 111-176, at 11.
       5 12 U.S.C. § 5511(a).
       6 Id; see also id. § 5481(12). The CFPA is Title X of the Dodd-Frank Wall Street Reform

and Consumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376 (2010).
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                                       No. 18-60302
deceptive, or abusive” practices related to consumer financial products and
services, such as retail banking, payday lending, and financial data processing,
to name a few. 7 As needed, the Bureau may promulgate rules, issue orders and
guidance, and supervise banks, payday lenders, and other covered entities. 8
The Bureau also has tools for conducting investigations and administrative
discovery, including the power to issue subpoenas and civil investigative
demands. 9 And it may hold hearings and conduct adjudications, as well as
bring civil enforcement actions in court through its own attorneys and in its
own name. 10
       Drawing on familiar features of agency design, Congress centralized
control of the new agency by handing the reins to a single CFPB director
appointed for a five-year term by the President with the advice and consent of
the Senate and removable by the President for “inefficiency, neglect of duty, or
malfeasance in office.” 11 Like other financial regulators, the CFPB’s funding
does not flow from annual congressional appropriations. 12 Instead, the director
requests from the Federal Reserve Board of Governors “the amount
determined . . . to be reasonably necessary to carry out the authorities of the
Bureau” each year, 13 capped by statute at twelve percent of the Federal
Reserve System’s budget. 14
       While consolidating the dispersed enforcement regime with its
vulnerability to agency capture, Congress remained attentive to the nigh

       7  12 U.S.C. § 5531.
       8  See id. §§ 5512(b), 5514–16.
        9 See id. § 5562 (a)–(c).
        10 See id. §§ 5563, 5564(a)–(b).
        11 Id. § 5491(b), (c)(3).
        12 See, e.g., id. § 16 (Comptroller of the Currency); id. § 243 (Federal Reserve Board);

id. §§ 1815(d), 1820(e) (Federal Deposit Insurance Corporation).
        13 Id. § 5497(a)(1).
        14 Id. § 5497(a)(2)(A)(iii).

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axiom that financial regulators work most effectively with a measure of
independence attending the accountability of executive oversight. 15 The result
was a CFPB overseen by the Financial Stability Oversight Council (“FSOC”),
which has veto power over any rule it concludes will “put the safety and
soundness of the United States banking system or the stability of the financial
system of the United States at risk.” 16 The President appoints a majority of the
FSOC’s members, all experts in banking, finance, or insurance. 17 “Thus, if the
Director’s decisionmaking goes awry on a critical rulemaking, a multi-member
body of experts can step in” to correct it. 18 In sum, the line of authority runs
directly to the President.
                                             I.
       In 2016, the CFPB filed this civil enforcement action against two
Mississippi-based check-cashing and payday-lending entities and their owner,
Michael Gray (collectively, the “Payday Lenders”) in the Southern District of
Mississippi.
       The complaint alleged that the Payday Lenders had engaged in “unfair,
deceptive, or abusive act[s] or practice[s]” 19 by, among other things, “refusing
to disclose [their] check cashing fee,” unlawfully “retain[ing] overpayments
made by consumers,” and “misrepresent[ing] the amount and number of fees
associated” with their lending services. From 2011 to 2017, the Payday

       15  See generally HENRY B. HOGUE ET AL., CONG. RESEARCH SERV., R43391,
INDEPENDENCE OF FEDERAL FINANCIAL REGULATORS: STRUCTURE, FUNDING, AND OTHER
ISSUES (2017).
       16 12 U.S.C. § 5513(a).
       17 Id. § 5321(b). Of the FSOC’s ten members, the President “has the opportunity to

appoint either at the outset or near the beginning of the administration” six of them: the
Secretary of the Treasury and the chairpersons of five independent agencies. PHH, 881 F.3d
at 120 n.3 (Wilkins, J., concurring). The remaining four members of the Council serve terms
longer than four years and so will not necessarily be appointed by a one-term president. Id.
       18 PHH, 881 F.3d at 120 (Wilkins, J., concurring).
       19 12 U.S.C. § 5531(a); see id. § 5536(a)(1)(B).

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Lenders “charged more than 46,000 consumers more than $5.4 million in
[unauthorized] check-cashing fees”—just one of the ways they allegedly fleeced
consumers. Over this period, Gray, their owner, assertedly paid himself “more
than $13.5 million in compensation,” plus salaries to his wife, seven-year-old
son, and six-month-old daughter.
      The Payday Lenders responded that the CFPB is unconstitutionally
structured and that any enforcement action it initiates is void from its
inception. 20 Looking to the D.C. Circuit’s then-recent en banc opinion in PHH
Corporation v. CFPB, 21 the district court denied the Payday Lenders’ motion
to dismiss, holding that “the Bureau is not unconstitutional based on its single-
director structure.” The district court then certified its order for interlocutory
appeal, observing that this case presents “substantial ground for difference of
opinion.” 22
      Meanwhile, a petition for en banc review was granted in Collins v.
Mnuchin, which presented a constitutional challenge to the Federal Housing
Finance Agency (“FHFA”), the federal regulator of two government-sponsored
entities (“GSEs”). 23 The en banc Court declined to consolidate the two cases.
This panel then heard oral argument but withheld decision pending the en
banc Court’s resolution of Collins. Collins ultimately held that the FHFA’s
“unique constellation of insulating features offends the Constitution’s
separation of powers.” 24 In essence, the en banc Court determined that the
FHFA is too insulated from executive control because it is funded through

      20  The Payday Lenders raised other defenses, but only its claim of unconstitutional
structure is before the Court on appeal.
       21 See 881 F.3d 75, 78 (D.C. Cir. 2018).
       22 See 28 U.S.C. § 1292(b).
       23 Collins v. Mnuchin, 896 F.3d 640 (5th Cir. 2018).
       24 Id. at 670; see Collins v. Mnuchin, 938 F.3d 553 (5th Cir. 2019) (en banc).

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                                       No. 18-60302
annual assessments on the GSEs, is free of any formal executive control, and
is led by a single director removable only for cause. 25
       The Collins Court distinguished PHH, where the D.C. Circuit rejected
similar attacks on the CFPB’s constitutionality. 26 Collins emphasized the
differing structures of the FHFA and CFPB, noting that while the Executive
Branch has no authority over the FHFA, it “can directly control the CFPB’s
actions through the FSOC.” 27 In its words, this distinction between the two
agencies “compel[led] a contrary conclusion.” 28 It follows that Collins’s analysis
of the FHFA is not offended by the panel’s analysis of the defenses to the
Bureau’s suit proffered here.
       On the filing of Collins, we directed the parties to respond to its effect
and held a second round of oral argument. The CFPB then notified the Court
of an about-face in its litigation position. The CFPB Director had defended the
constitutionality of the agency’s structure, but advised that she now “agrees
with the Department of Justice that the CFPA’s for-cause removal provision
impermissibly infringes on the President’s constitutional obligation to take
care that the laws be faithfully executed.” 29
                                             II.
       The Payday Lenders argue that the structure of the CFPB denies the
Executive Branch its due because the Bureau is led by a single director
removable by the President only for cause. We find no support for this

       25 Collins, 896 F.3d at 674 (panel); Collins, 938 F.3d at 588 (en banc) (reinstating the
opinion of the Collins panel with respect to the constitutionality of FHFA’s structure).
       26 Collins, 896 F.3d at 670–74 (panel); see Collins, 938 F.3d at 588 (en banc)

(distinguishing PHH).
       27 Collins, 896 F.3d at 673 (panel).
       28 Id.
       29 On October 18, 2019, the Supreme Court granted certiorari to hear an appeal of the

Ninth Circuit’s decision in CFPB v. Seila Law LLC, which upheld the CFPB’s
constitutionality on grounds similar to the D.C. Circuit’s in PHH. Seila Law, 923 F.3d 680
(9th Cir.), cert. granted, 140 S. Ct. 427 (2019).
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argument in constitutional text or in Supreme Court decisions and uphold the
constitutionality of the CFPB’s structure, as did the D.C. and Ninth circuits.
      The Constitution grants Congress the authority to establish and
structure    executive-branch        offices,       agencies,   and    departments.     The
Appointments Clause, with its complementing Necessary and Proper Clause,
establishes Congress’s role as chief architect of the Executive Branch:
            [The President] shall nominate, and by and with the Advice
      and Consent of the Senate, shall appoint . . . all other Officers of
      the United States, whose Appointments are not herein otherwise
      provided for, and which shall be established by Law: but the
      Congress may by Law vest the Appointment of such inferior
      Officers, as they think proper, in the President alone, in the Courts
      of Law, or in the Heads of Departments. 30
All officers, whether principal or inferior, are established “by Law”—an Act of
Congress, not presidential order. 31 The President may appoint officers, but
beyond his veto power he has no special role in the creation of their offices.
This is because the Necessary and Proper Clause sweeps the authority to
establish offices into Article I, providing Congress not only the power to make
all laws “necessary and proper for carrying into Execution” its enumerated
powers but also “all other Powers vested by this Constitution in the
Government of the United States, or in any Department or Officer thereof.” 32
      These clauses allocate the power to assemble the structures of our
government—Congress may both create an agency and define its authorities,
responsibilities, leadership structure, and chain of command. As James
Madison explained it to the First Congress in New York: “The Legislature
creates the office, defines the powers, limits its duration, and annexes a

      30 U.S. CONST. Art. 2, § 2, cl. 2 (emphases added).
      31 This excludes those offices specifically provided for in the Constitution.
      32 U.S. CONST. Art. 1, § 8, cl. 18 (emphasis added).

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compensation.” 33 That is, the Constitution gave Congress the task of building
the Executive Branch, explaining the want of attention by the First Congress
to the President’s role in establishing offices before creating the first executive
departments and their corresponding principal and inferior offices. 34
       And so it is unsurprising that Congress’s authority to organize the
Executive Branch presents as well established in contrast to the less certain
foundations of a President’s authority to remove officers. Impeachment aside,
the President’s power of removal was little discussed at the Constitutional
Convention and is not addressed in the Constitution. 35 And the Framers held
disparate views on where the power of removal ought reside. Alexander
Hamilton argued that the “consent of [the Senate] would be necessary to
displace as well as to appoint” officers. 36 But Madison then argued in the First
Congress that there was no limit on the President’s constitutional authority to
remove the Secretary of Foreign Affairs, while intimating that Congress may
limit the scope of the President’s removal power over certain officers. 37 The
Supreme Court has since found the President’s removal power to be implicit in
the Executive Vesting Clause and the Take Care Clause: “Article II vests ‘[t]he
executive Power . . . in a President of the United States of America,’ who must
‘take Care that the Laws be faithfully executed.’” 38 Thus, Congress cannot so

       33  See 1 ANNALS OF CONG. 581 (1789).
       34  DAVID P. CURRIE, THE CONSTITUTION IN CONGRESS: THE FEDERALIST PERIOD 1789-
1801, at 36 n.205 (1997).
        35 Myers v. United States, 272 U.S. 52, 109–10 (1926).
        36 THE FEDERALIST NO. 77.
        37 1 ANNALS OF CONG. 611–12 (1789) (stating that an official who “partakes strongly

of the judicial character . . . should not hold . . . office at the pleasure of the Executive branch
of the Government”).
        38 Free Enter. Fund v. Pub. Co. Accounting Oversight Bd., 561 U.S. 477, 483 (2010)

(quoting U.S. CONST. Art. II, § 1, cl. 1; and id. § 3).
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constrain the President’s removal authority as to deprive him of the ability to
perform his “constitutionally assigned duties.” 39
       Against Congress’s sweeping textually footed power to organize agencies
and the President’s judicially implied, necessary authority to remove officers,
the Supreme Court has, without exception, upheld for-cause protection for
officers so long as removal authority remains in the hands of the President or
his at-will agents. 40 In Humphrey’s Executor v. United States, the Court upheld
for-cause protection for Federal Trade Commissioners. 41 In Wiener v. United
States, it upheld for-cause protection for the War Claims Commissioners, who
were responsible for adjudicating claims arising out of World War II. 42
Significantly, the Wiener Court recognized removal protection for the
Commissioners though the statute was silent on such limits. Similarly, in Free
Enterprise Fund v. PCAOB, the Court inferred for-cause protection for SEC
commissioners. 43 The Court also upheld for-cause removal protection for the
independent counsel in Morrison v. Olson, even though Congress had given the
removal authority to the President’s at-will agent, the Attorney General. 44
       Although the Supreme Court has never invalidated a for-cause stricture
on the President’s removal power, it has struck down officer removal
restrictions three times—each where the removal power has been held by
Congress or given to someone other than the President. In Myers v. United
States, the Court held Congress could not condition the President’s decision to

       39 Morrison v. Olson, 487 U.S. 654, 696 (1988).
       40 These cases were described at greater length in PHH, 881 F.3d at 96. Like the Ninth
Circuit, “[w]e see no need to re-plow the same ground here.” Seila Law, 923 F.3d at 682.
       41 295 U.S. 602 (1935).
       42 357 U.S. 349 (1958).
       43 561 U.S. at 487 (internal citations omitted) (quoting Humphrey’s Ex’r, 295 U.S. at

620) (“The parties agree that the Commissioners cannot themselves be removed by the
President except under the Humphrey’s Executor standard of ‘inefficiency, neglect of duty, or
malfeasance in office,’ and we decide the case with that understanding.”).
       44 487 U.S. 654 (1988).

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remove an officer on the advice and consent of the Senate. 45 Likewise, in
Bowsher v. Synar, the Court concluded that Congress could not retain the
authority to remove an executive officer. 46 Most recently, in Free Enterprise
Fund v. PCAOB, the Court returned to the issue of removal power where
members of the Public Company Accounting Oversight Board (“PCAOB”) could
be removed only for cause and only by SEC Commissioners, not the
President. 47 The Court held that Congress withdrew “from the President any
decision on whether that good cause exists. That decision [was] vested instead
in other tenured officers—the Commissioners—none of whom [was] subject to
the President’s direct control.” 48 The Court invalidated the PCAOB’s for-cause
protection but left intact the SEC’s for-cause protection. In so doing, the Court
effectively returned the power of removal to the President’s hand. 49
       The structure of the CFPB is well within the constitutional lines drawn
by the Supreme Court. In the CFPA, Congress gave itself no removal authority.
It only imposed a constraint on removal that the Supreme Court has twice read
into otherwise silent statutes. 50 And Congress left the decision to remove the
CFPB Director to the President alone: Neither Congress nor any subordinate
officer plays a role in the President’s exercise of his removal authority. This
forecloses the challenge to the constitutionality of the CFPB.

       45  272 U.S. 52 (1926).
       46  478 U.S. 714 (1986).
        47 561 U.S. 477 (2010).
        48 Id. at 495.
        49 Id. at 509 (“The Commission is then fully responsible for the Board’s actions, which

are no less subject than the Commission’s own functions to Presidential oversight.”).
        50 Id. at 487; Wiener, 357 U.S. at 349–50; see also Collins, 896 F.3d at 667 (“[L]imiting

the President to ‘for cause’ removal is not sufficient to trigger a separation-of-powers
violation.”).
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       Our conclusion is nigh controlled by Humphrey’s Executor. 51 There, the
Court upheld for-cause protection for FTC Commissioners, who were
empowered to prohibit the use of “unfair methods of competition in
commerce.” 52 This protection afforded them a measure of independence vital to
their “predominantly quasi judicial and quasi legislative” roles. 53 Thus, the
FTC and CFPB are constitutional siblings in all constitutionally relevant
respects: They are both consumer-protection financial regulators with quasi-
legislative, quasi-judicial, and some executive powers, whose leaders enjoy
identical and limited for-cause protection.
       Our issue is not the “power” of the agency in the abstract but the
allocation of its superintendence. Still, the Payday Lenders argue that
Humphrey’s Executor is inapposite because the CFPB is uniquely powerful. To
be sure, the CFPB has significant civil enforcement authority that the FTC
lacked when Humphrey’s Executor was decided in 1935. 54 But as Morrison
recognized, the FTC’s restriction on for-cause removal remains constitutional
even though the FTC, like the CFPB, can now bring civil actions. 55 More
importantly, Morrison upheld the for-cause removal restriction for the
independent counsel even though she was authorized to investigate and
prosecute crimes, a quintessential executive power. 56 And in Free Enterprise
Fund, the Supreme Court left in place the SEC’s for-cause removal restriction

       51   See Seila Law, 923 F.3d at 684 (“In short, we view Humphrey’s Executor and
Morrison as controlling here.”).
        52 Humphrey’s Ex’r, 295 U.S. at 620 (quoting 15 U.S.C. § 45(a)(2)).
        53 Id. at 629. As the Supreme Court recognized in Morrison, “it is hard to dispute that

the powers of the FTC at the time of Humphrey’s Executor would at the present time be
considered ‘executive,’ at least to some degree.” 487 U.S. at 690 n. 28.
        54 See Magnuson-Moss Warranty-Federal Trade Commission Improvement Act, Pub.

L. No. 93-637, § 205(a), 88 Stat. 2183, 2200–01 (1975) (codified as amended at 15 U.S.C.
§ 45(m)(1)(A)) (authorizing the FTC to “commence a civil action to recover a civil penalty in
a district court of the United States”).
        55 Morrison, 487 U.S. at 692 n.31.
        56 Id. at 691.

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even though the SEC, a financial regulator like the CFPB, wields broad
enforcement, rulemaking, and adjudicatory powers. 57
       The Payday Lenders point out that the CFPB, unlike the FTC, is led by
a single director, not multiple commissioners, but this offered distinction is
without support in Supreme Court precedent. As both PHH and Seila Law
recognized, Humphrey’s Executor and Wiener attached no significance to the
fact that the agencies were led by multiple members. 58 Further, “[t]he fact that
the independent counsel [in Morrison] was a solo actor played no role in either
the Court’s decision for an eight-member majority or Justice Scalia’s
dissent[.]” 59 Nor in Bowsher was it of any consequence that the General
Accounting Office was led by the Comptroller General alone and not a board of
commissioners. 60 What mattered was that Congress had appropriated to itself
the President’s authority to remove an executive officer.
                                             III.
       Our decision in Collins provides no assistance to the Payday Lenders.61
There, we found that the FHFA’s single-member leadership, in conjunction
with for-cause removal protection and other features, unconstitutionally
insulated the FHFA. 62 We reached this conclusion only after conducting a “fact-
specific inquiry,” one that made plain the reality that the FHFA is “sui

       57  Free Enter. Fund, 561 U.S. at 514.
       58  Seila Law, 923 F.3d at 684; PHH, 881 F.3d at 98–99.
        59 PHH, 881 F.3d at 96; see also id. at 96 n.2 (concluding that the distinction between

inferior and principal officers is irrelevant in removal cases because they are concerned not
with whether the officer exercises governmental authority, but with whether the officer’s
independence interferes with the President’s constitutional obligation to ensure the faithful
execution of the laws).
        60 478 U.S. at 731–32.
        61 See Collins, 896 F.3d at 675 n. 274 (“We leave for another day the question of

whether other agencies suffer from similar constitutional infirmities. And, of course, our
opinion does not abrogate the Morrison Court’s holding regarding the constitutionality of an
independent agency tasked with investigating high-ranking Executive Branch officials.”).
        62 Id. at 659–75.

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generis.” 63 It is not “similarly situated” to the FTC in Humphrey’s Executor,
the independent counsel in Morrison, or the CFPB in PHH. 64 Then—and here
it distinguishes the CFPB as well—we reasoned that whereas the FSOC’s veto
provides the Executive Branch with “an emergency brake to hold the CFPB
accountable,” the Executive Branch holds no formal control over the FHFA. 65
       Here, the single-leader structure mitigates the constitutional concerns
underlying for-cause removal protection. 66 Before the 2008 financial crisis,
seven different agencies—“virtually all of which were also independent” 67—
shared responsibility for consumer financial protection. 68 The diffusion of
responsibility looked past regulatory arbitrage and undercut accountability.69
A President determined to change the administration of consumer financial
protection would have faced a bureaucratic maze—multiple multi-member
agencies with disparate authorities spread across eighteen statutes. 70 As the
Supreme Court recognized in Free Enterprise Fund, “[t]he diffusion of power
carries with it a diffusion of accountability. . . . Without a clear and effective
chain of command, the public cannot ‘determine on whom the blame or the
punishment of a pernicious measure, or series of pernicious measures ought

       63 Id. at 666 n. 196, 670.
       64 Id. (formatting modified).
       65 Id. at 670, 673–74.
       66 Cf. Brief of Rachel E. Barkow, Kirti Datla, Richard L. Revesz, and Robert B.

Thompson as Amici Curiae, p.3, CFPB v. Seila Law, No. 19-7, (petition for cert. granted, Oct.
18, 2019) (“[T]he neat distinction between single-member agencies and multi-member
agencies . . . rests on inaccurate descriptions of how multi-member agencies are structured,
and how they function.”).
       67 PHH, 881 F.3d at 81.
       68 S. REP. NO. 111-176, at 11 (2010) (“The legislation ends the fragmentation of the

current system by combining the authority of the seven federal agencies involved in consumer
financial protection in the CFPB, thereby ensuring accountability.”).
       69 Id. (“The CFPB will stop regulatory arbitrage.”); id. at 229 (“The CFPB would stop

regulatory arbitrage—it will write rules and enforce those rules consistently[.]”).
       70 12 U.S.C. §§ 5481(12), 5581(a)(2), (b) (transferring these statutory authorities to the

CFPB).
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                                       No. 18-60302
really to fall.’” 71
       Congress replaced this unmanageable bureaucracy with the CFPB, a
single agency led by a single director. The CFPB’s single-leader structure
places responsibility, public scrutiny, and political pressure on the shoulders
of one individual, preventing the risk of buck-passing that may undermine the
accountability of some multi-member commissions. 72 And it allows the
President to exercise tighter control over the CFPB, as the President need only
remove the Director, not several commissioners, to change its direction. His
appointees are positioned with firm control.
       Free Enterprise Fund also eschewed the focus on miscellaneous elements
of agency design that the Payday Lenders urge here. The Court rejected the
dissent’s argument that agency independence often turns less on for-cause
removal than on a host of legislative decisions about the agency structure. 73 It
dismissed these considerations as “bureaucratic minutiae” that downplay the
“importance of the removal as a tool of supervision.” 74 Indeed, the Payday
Lenders identify no case in which a Supreme Court decision turned on such
factors. While they cling to Free Enterprise Fund, it offers no receiving hand.
The constitutional problem was not bureaucratic minutiae but the presence of
layered removal clauses, which gave the power of removal to another, together

       71 561 U.S. at 497–98 (quoting THE FEDERALIST NO. 72 (Alexander Hamilton)).
       72  See Ganesh Sitaraman & Ariel Dobkin, The Choice Between Single Director Agencies
and Multimember Commissions, 71 ADMIN. L. REV. 719 (2019). Ultimately, it is for Congress
to resolve the quasi-empirical claims about the effects of different agency designs. Judges are
not natural architects of bureaucracies, as we cannot make the fine-grained trade-offs
inherent in the design of agencies.
        73 See Free Enter. Fund, 561 U.S. at 524 (Breyer, J., dissenting) (“[A] legislative

decision to place ultimate administrative authority in, say, the Secretary of Agriculture
rather than the President, the way in which the statute defines the scope of the power the
relevant administrator can exercise, the decision as to who controls the agency’s budget
requests and funding, the relationships between one agency or department and another, as
well as more purely political factors (including Congress’ ability to assert influence) are more
likely to affect the President’s power to get something done.”).
        74 Id. at 500; see also PHH, 881 F.3d at 126–27 (Griffith, J., concurring in judgment).

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effectively cutting the President’s line of authority to remove the members of
the PCAOB.
                                             IV.
       Even if the CFPB’s constitutionality be doubted, constitutional
avoidance would counsel footing our decision on statutory grounds: “It is the
duty of federal courts to construe a statute in order to save it from
constitutional infirmities[.]” 75 We may read the standard to impose only a
lesser limit on the President’s power to remove. One such reading appears in
PHH, which concluded that “inefficiency” should be read to permit removal on
the basis of policy disagreement alone; 76 that Bowsher, where Congress
claimed for itself the power to remove an officer for inefficiency, neglect, or
malfeasance, 77 determined that the removal standard was “very broad” and
“could sustain removal of a Comptroller General for any number of actual or
perceived transgressions of the legislative will.” 78 And looking to dictionary
definitions from the time the “inefficiency, neglect of duty, or malfeasance”
standard was first adopted, as well as the present day, “inefficiency” in
particular bears a capacious definition capable of encompassing policy
disagreement. 79 This is “a construction of the statute” that is “fairly possible.” 80
It follows that even if this were not the only fair construction of the standard,
its breadth welcomes constitutional avoidance, an anodyne of patience to await
a decision that may be necessary, if at all, at a later time when events may
have brought light to the issue or see them fall into a bin of lost currency.

       75 Morrison, 487 U.S. at 682
       76 See generally PHH, 881 F.3d at 125–37 (Griffith, J., concurring in judgment).
       77 Id. at 129.
       78 Id. (quoting Bowsher, 478 U.S. at 729).
       79 Id. at 131–34.
       80 Ashwander v. Tenn. Valley Auth., 297 U.S. 288, 348 (1936) (Brandeis, J., concurring)

(quoting Crowell v. Benson, 285 U.S. 22, 62 (1932)).
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                                 No. 18-60302
                                      V.
      The President can remove the CFPB Director only for “inefficiency,
neglect of duty, or malfeasance in office,” a broad standard repeatedly approved
by the Supreme Court. That alone is enough to decide this case. If there is any
threat of undue concentration of power, the Office of President is its
beneficiary.

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                                        No. 18-60302
JERRY E. SMITH, Circuit Judge, dissenting:

       We are not the first court to address a constitutional challenge to the
CFPB, nor will we be the last. 1 When the District of Columbia Circuit took a
spin, then-Judge Kavanaugh urged that the issue ultimately turns on one con-
cept: power. 2 Right he was. This case presents a fundamental question about
governmental authority: May Congress vest enormous executive power in one
person who does not answer to the President or, indeed, to anyone else? More
on that to come.

       But Justice Kavanaugh was right in a way that not even he could have
foreseen. Here at the Fifth Circuit, the latest test of the CFPB’s legitimacy has
deteriorated into a regrettable commentary on another form of power: the
asserted prerogative of two judges to abandon en banc precedent they dislike.

       In Collins v. Mnuchin, 3 the en banc court confronted a challenge to the
Federal Housing Finance Agency (“FHFA”)—an entity that, in all relevant
respects, is indistinguishable from the CFPB. We concluded, by a strong 12–4
margin, that the FHFA’s structure was unconstitutional. Yet today, the major-
ity holds the very opposite for the CFPB, basing its naked disagreement with
the en banc court on the flimsiest of grounds. Indeed, one judge in the majority
dissented in Collins but now enacts his disagreement into law. The other judge
did not participate in Collins, but even a skim of his “paean to the adminis-
trative state” 4 reveals that he too would have dissented.

       1 See CFPB v. Seila Law LLC, 923 F.3d 680 (9th Cir.), cert. granted, 140 S. Ct. 427
(2019) (argued Mar. 3, 2020).
       2See PHH Corp. v. CFPB, 881 F.3d 75, 166 (D.C. Cir. 2018) (en banc) (Kavanaugh, J.,
dissenting).
       3 938 F.3d 553 (5th Cir. 2019) (en banc), petition for cert. filed (U.S. Sept. 25, 2019)
(No. 19-422).
       4   Free Enter. Fund v. Pub. Co. Accounting Oversight Bd., 561 U.S. 477, 499 (2010).
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       Collins winds up in the dustbin because two judges say it should. At one
time, those judges thought it beyond the pale “to rely on strength in numbers
rather than sound legal principles in order to reach their desired result in [a]
specific case.” 5 Now, they suddenly discover that stare decisis is for suckers. 6

       This case is absolutely about power. The majority declares open season
on the en banc court. With great respect for my two dedicated colleagues, who
would not purposefully undermine the rule of law, I dissent.

                                        I. THE CFPB
       Congress turned to a familiar tool in response to the 2008 financial
crisis—a new independent bureau. Enter the CFPB. Title X of the Dodd-Frank
Wall Street Reform and Consumer Protection Act 7 established the Bureau and
housed it within the Federal Reserve System (the “Fed”). Congress exhorted
the CFPB to “regulate the offering and provision of consumer financial prod-
ucts or services under” federal law and “ensur[e] that all consumers have
access to” “fair, transparent, and competitive” markets for those products.
12 U.S.C. §§ 5491(a), 5511(a). To carry out its roving commission, Congress
gave the Bureau a lot of muscle. It exercises some form of all three govern-

       5 June Med. Servs., L.L.C. v. Gee, 913 F.3d 573, 574 (5th Cir.) (Dennis, J., joined by
Higginbotham, Graves, and Higginson, JJ., dissenting from the denial of rehearing en banc),
cert. granted, 140 S. Ct. 35, and cert. granted, 140 S. Ct. 35 (2019) (argued Mar. 4, 2020).
       6 Yet my colleagues are well aware of this court’s steady invocation of stare decisis
that we call the rule of orderliness, which prohibits three-judge panels from sidestepping the
rulings of previous panels and, more importantly, en banc decisions. See, e.g., Ladd v. Living-
ston, 777 F.3d 286, 289 (5th Cir. 2015) (Higginbotham, J.) (“Under our circuit’s rule of orderli-
ness, these decisions, involving the application of essentially the same facts to the same law,
control our own, and require us to deny the [requested] relief.”); United States v. Castillo-
Rivera, 853 F.3d 218, 227 (5th Cir. 2017) (en banc) (Higginbotham, J., concurring) (“To go
forward and reduce the jurisprudence of stare decisis to a detailed code confected by case-by-
case determination of rules apart from our well-developed principles of stare decisis would
serve disorder, not order.”).
       7   Pub. L. No. 111-203, 124 Stat. 1376, 1955 (2010).
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                                       No. 18-60302
mental functions: executive, legislative, and judicial. 8

                                         A. Powers
       Start with the CFPB’s rulemaking authority. It may prohibit any prac-
tice it considers “unfair, deceptive, or abusive” “in connection with any trans-
action with a consumer” in the consumer-financial space. 9 The power to pro-
scribe “abusive” practices appears new in the history of consumer-protection
law. 10 And it applies in an impressive number of contexts, given that the
CFPB’s rulemaking ambit includes mortgages, consumer loans, and credit
cards, among other products. See id. § 5481(12).

       The CFPB also can adjudicate disputes arising under the many laws that
it “is authorized to enforce” and any rules that the Bureau prescribes. Id.
§ 5563(a)(1), (2). In other words, the CFPB can write the law and then hear
disputes under it. 11

       But maybe most significant is the Bureau’s power to enforce consumer-

       8Under the infamous legal fiction that justifies the non-delegation doctrine, the CFPB
does not explicitly wield legislative power. But see Whitman v. Am. Trucking Ass’ns, Inc.,
531 U.S. 457, 488 (2001) (Stevens, J., concurring in part and in the judgment) (“[I]t would be
both wiser and more faithful to what we have actually done in delegation cases to admit that
agency rulemaking authority is legislative power.” (quotation marks removed)).
       9 12 U.S.C. § 5531(b) (emphasis added). The statute, see id. § 5531(c), (d), provides
further color as to what the Director may permissibly deem “unfair” or “abusive.”
       10See PHH, 881 F.3d at 145 (Henderson, J., dissenting) (“The agency also has expan-
sive new powers under Title X to investigate, charge, adjudicate and penalize . . . a consumer-
connected act or practice the agency defines as unfair, deceptive, or abusive.” (quotation
marks removed)); Todd Zywicki, The Consumer Financial Protection Bureau: Savior or Men-
ace?, 81 GEO. WASH. L. REV. 856, 918 (2013) (“The term ‘abusive,’ as used in this context,
appears to be an entirely novel term with no forerunners in any prior federal or state statute
or regulation.”).
       11 Cf. Gundy v. United States, 139 S. Ct. 2116, 2148 (2019) (Gorsuch, J., dissenting)
(“[W]hile Congress can enlist considerable assistance from the executive branch in filling up
details and finding facts, it may never hand off to the nation’s chief prosecutor the power to
write his own criminal code.”).
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                                       No. 18-60302
protection laws. See id. § 5481(12). For years, legislators clamored for a body
that might centralize and streamline enforcement of federal consumer protec-
tion. 12 The CFPB was the answer. Congress transferred to it the right to
administer eighteen statutes (in addition to Title X itself) that seven different
agencies had previously overseen. 13

         In brandishing its enforcement authorities, the Bureau retains all the
accoutrements of executive power. It can bring enforcement actions in federal
court and before administrative law judges. Id. § 5564. It may issue subpoenas
for testimony or documents, enforceable by contempt. Id. § 5562(b). It can
make civil investigative demands and file petitions for their enforcement in
federal court. Id. § 5562(e). And it may seek a smorgasbord of penalties,
including rescission of contracts, restitution, disgorgement, damages, and even
limits on the defendant’s activities and functions. Id. § 5565(a)(2).

                                       B. Structure
         All of that power is bestowed on one lucky person. Meet the Director of
the CFPB, whom the President appoints with the Senate’s advice and consent.
Id. § 5491(b)(1)–(2). After her confirmation, the Director is largely insulated
from the political branches. But the President still has two avenues for over-
sight.        Most significantly, he retains the power to fire the Director, id.
§ 5491(c)(3)—but that authority exists only in neutered form. The Director’s

          See, e.g., Elizabeth Warren, Unsafe at Any Rate, DEMOCRACY (Summer 2007),
         12

perma.cc/52X3-892V; see also Zywicki, supra, at 857–58 (“[T]he system of consumer financial
protection needed streamlining and reform even before the onset of the financial crisis. A
patchwork of agencies covered different aspects of the financial system and all of them tended
to focus on safety and soundness issues rather than consumer protection.”).
         See PHH, 881 F.3d at 80–81; see also 12 U.S.C. § 5481(12) (listing eighteen statutes
         13

transferred to the CFPB’s jurisdiction). The seven agencies were the Federal Reserve, Office
of the Comptroller of the Currency, Office of Thrift Supervision, Federal Deposit Insurance
Corporation, National Credit Union Administration, Department of Housing and Urban
Development, and Federal Trade Commission (“FTC”). 12 U.S.C. § 5581(b).
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                                       No. 18-60302
five-year tenure 14 is guaranteed so long as she does not slack into “inefficiency,
neglect of duty, or malfeasance in office.” 15 Separately, the Financial Stability
Oversight Council (“FSOC” or “Council”) affords the President a limited means
to review the CFPB’s rulemakings. See id. § 5321.

       As for Congress, the CFPB’s structure similarly permits little room for
oversight. The Bureau is not funded with congressional appropriations; it
instead draws from the Fed’s coffers. See id. § 5497. The Director may request
the amount she reasonably needs, and, so long as the request doesn’t exceed
twelve percent of its budget, the Fed can’t turn the Director down.                       Id.
§ 5497(a)(1), (2)(A)(iii). If the request exceeds that upper limit, the CFPB must
ask Congress for the excess. Id. § 5497(e).

                    II. EVALUATING REMOVAL RESTRICTIONS
       The defendants assert that various features of the CFPB’s design com-
bine to violate the separation-of-powers doctrine. They complain that the Pres-
ident must be able to remove the Bureau’s single Director at will. Between the
Supreme Court and this tribunal, much has been said about the power of Con-
gress to interfere with the President’s authority to remove his subordinates.

                          A. Removal at the Supreme Court
       The Constitution assigns “[t]he executive Power” to “a President of the
United States of America,” U.S. CONST. art. II, § 1, cl. 1, and it exhorts the
President to “take Care that the Laws be faithfully executed,” id. art. II, § 3.

       1412 U.S.C. § 5491(c)(1). The five-year term can extend a bit longer pending confir-
mation of a new Director. See id. § 5491(c)(2).
       15Id. § 5491(c)(3). That is standard language for independent agencies. See Lawrence
Lessig & Cass R. Sunstein, The President and the Administration, 94 COLUM. L. REV. 1, 110
(1994). The same applies to removal of the commissioners of the FTC, for example. See
15 U.S.C. § 41; see also Humphrey’s Ex’r v. United States, 295 U.S. 602, 629 (1935) (upholding
that removal restriction).
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                                       No. 18-60302
Those provisions have inspired plenty of debate about the scope of executive
authority. But the Supreme Court has made at least two things certain.

      The first is that the President retains the power to remove executive offi-
cers. See Free Enter. Fund, 561 U.S. at 483. That removal power is justified
on two related theories: on the one hand, that it inheres in the nature of exec-
utive power; and, on the other, that the President must be able to remove
subordinates if he is to execute the law. 16

      The second is that the President’s removal power has limits. Except
when it sits in impeachment, Congress cannot assume for itself a role in
removal. 17     But it may, “under certain circumstances, create independent
agencies run by principal officers appointed by the President, whom the Presi-
dent may not remove at will but only for good cause.” Id. The Supreme Court
has upheld the constitutionality of powerful, multimembered agencies whose
leaders have protection from termination. 18 It also has sustained the power of
Congress to grant removal protections to a solo independent counsel of limited
authority. 19     It has not, however, present Term excluded, 20 confronted an
agency like the CFPB, with both tremendous power and a solitary leader.

      The inquiry for analyzing removal constraints is settled. Initially, the

      16 See Free Enter. Fund, 561 U.S. at 484; Steven G. Calabresi & Saikrishna B. Pra-
kash, The President’s Power To Execute the Laws, 104 YALE L.J. 541, 597–98 (1994).
      17 See Myers v. United States, 272 U.S. 52 (1926) (holding unconstitutional a scheme
in which Congress required its advice and consent before the President could remove post-
masters); Bowsher v. Synar, 478 U.S. 714 (1986) (holding unconstitutional Congress’s assig-
nation of executive power to the Comptroller General, an officer whom Congress had the
power to remove).
      18 See Humphrey’s Ex’r, 295 U.S. at 629 (FTC); Wiener v. United States, 357 U.S. 349
(1958) (War Claims Commission).
      19   See Morrison v. Olson, 487 U.S. 654 (1988).
      20   See Seila Law, 923 F.3d at 682.
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Court asked whether the agency exercised quasi-judicial, quasi-legislative, or
quasi-executive power. See Humphrey’s Ex’r, 295 U.S. at 624. But the Court
later adopted a more “considered view.” Morrison, 487 U.S. at 689. In Mor-
rison, id. at 689–90, the Court turned the spotlight on the degree to which the
restrictions intrude on executive authority. Indeed, when Congress tries to
limit the President’s power to remove an executive official, we ask whether the
legislators have “unduly trammel[ed] on executive authority” and “interfere[d]
impermissibly with [the President’s] constitutional obligation to ensure the
faithful execution of the laws.” Id. at 691, 693. That is, we decide whether
Congress has unduly insulated the officer from the President’s oversight. 21

                             B. Collins v. Mnuchin (en banc)
       The CFPB’s single-Director, removal-protected structure is rare in
American history. 22 But it is not unfamiliar to this circuit’s en banc court. Just
last year, in Collins v. Mnuchin, 23 we ruled on a constitutional challenge to the
FHFA, an agency whose structure is a near-perfect image. Collins is hot off
the press but apparently deserves to be ignored.

                                                1.
       On to Collins. Congress charged the FHFA with overseeing two impor-

       21 See Free Enter. Fund, 561 U.S. at 501 (analyzing a public accounting board’s degree
of “insulation from the President”).
       22 See PHH, 881 F.3d at 178 (Kavanaugh, J., dissenting); Zywicki, supra, at 899; see
also Free Enter. Fund, 561 U.S. at 505 (“Perhaps the most telling indication of the severe
constitutional problem with the [agency] is the lack of historical precedent for this entity.”).
The D.C. Circuit uncovered only three other similar agencies: the Social Security Adminis-
tration, Office of Special Counsel, and FHFA, the last of which came into being only in 2008.
See PHH, 881 F.3d at 174 (Kavanaugh, J., dissenting).
       23 896 F.3d 640 (5th Cir.) (per curiam), reinstated in relevant part on reh’g en banc,
938 F.3d 553 (5th Cir. 2019) (en banc), petition for cert. filed (U.S. Sept. 25, 2019) (No. 19-422).
The en banc court reinstated the panel’s constitutional analysis. See Collins, 938 F.3d at 588.
So I refer interchangeably to the two decisions as “Collins.”
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                                         No. 18-60302
tant government-sponsored entities: the Federal National Mortgage Associa-
tion (“Fannie”) and the Federal Home Loan Mortgage Corporation (“Freddie”).
Collins, 938 F.3d at 563. The FHFA is led by a single Director, serving a five-
year term, whom the President can fire only “for cause.”                        See 12 U.S.C.
§ 4512(a), (b)(2).      Congress does not fund the FHFA with appropriations;
instead, the agency assesses charges on the entities it regulates.                           See
id. § 4516(a). An oversight board advises the agency as it carries out its duties.
See id. § 4513a(a).

      The FHFA wields its fair share of power. It issues rules, orders, and
guidelines to ensure Fannie’s and Freddie’s “sound operations.” 24 The agency
can sue Fannie and Freddie for breaking the law or engaging in unsound prac-
tices, can impose penalties, and can order the companies to cease and desist
and to remedy violations. 25

      But, most potently, the FHFA can name itself conservator or receiver for
Fannie or Freddie if either becomes critically undercapitalized. See id. § 4617.
Once so appointed, the FHFA is empowered to conduct all aspects of the com-
panies’ business, perform all their functions, preserve or sell their assets, enter
into contracts, collect obligations, and so much more. 26

                                                2.
      In assessing the FHFA’s structure, the en banc court in Collins did not
view the agency’s various design features in isolation. Instead, we assessed
the “combined effect” of several of them to determine whether they insulated

      24   Collins, 938 F.3d at 565; see 12 U.S.C. §§ 4513, 4526(a).
      25   Collins, 938 F.3d at 565; see 12 U.S.C. §§ 4631(a)(1), (c), 4632(e), 4635, 4636, 4641.
      26   Collins, 938 F.3d at 578; see generally 12 U.S.C. § 4617.
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                                          No. 18-60302
the Director too deeply from oversight. 27 The result? Twelve of the sixteen
judges agreed: The FHFA cannot withstand constitutional scrutiny. 28

       The first two features were the most significant. A solo Director leads
the agency, and she is not removable at will. 29 We recognized that the removal
restriction is not enough, standing alone, to violate the Constitution. Collins,
896 F.3d at 667. Yet it undoubtedly “dulls an important tool for supervising
the FHFA.” Id. at 666 (footnote removed).

       The single-Director structure is also an insulating innovation. 30 To date,
Congress has given the overwhelming majority of independent agencies multi-
membered boards. Id. at 667. The President can influence those agencies by
designating their chairs and removing them at will from that position. Id. The
FHFA is different. A President can find himself “stuck for years” with a Dir-
ector selected by a predecessor and opposed to the current administration’s
policies. Id. at 668. Because of its solo Director, the FHFA also lacks bi-
partisan balance, an otherwise standard feature among agencies. See id. Bal-
anced agencies enable the President to “secure a majority . . . within the first
two years of his term.” Id. Not so for the FHFA.

       The agency is also insulated from Congress, which, in operation, further

       27 Collins, 896 F.3d at 666; see Eric Pearson, A Brief Essay on the Constitutionality of
the Consumer Financial Protection Bureau, 47 CREIGHTON L. REV. 99, 118 (2013) (“It is the
convergence of these factors rather than any single factor that brings the issue of constitu-
tionality to the fore. Even if some independence from checks and balances is appropriate or
even preferable as a matter of policy, the question in this context is whether the simultaneous
presence of all of these immunities makes the CFPB too independent.”).
       28 See Collins, 938 F.3d at 562 (showing eight judges concurring in Judge Willett’s
majority opinion); id. at 591 n.1 (showing three additional judges concurring in the conclusion
that the FHFA was structured unconstitutionally).
       29   See 12 U.S.C. § 4512(a), (b)(2); Collins, 896 F.3d at 666–68.
       30   See Collins, 896 F.3d at 667; 12 U.S.C. § 4512(a).
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reduces the President’s oversight. See id. at 668–69. Indeed, because the
FHFA does not rely on appropriations, the President loses another tool for
overseeing it: namely, his power to veto spending bills related to the agency
and to submit annual budgets for Congress’s consideration. Id.

      The final feature is the lack of any robust vehicle for executive-branch
oversight. Id. at 669. Though the Federal Housing Finance Oversight Board
advises the Director, 12 U.S.C. § 4513a(a), the Board can’t “require the FHFA
or Director to do anything,” Collins, 896 F.3d at 669. Thus, the merging of
several features—solo Director, removal protections, partisanship, abnormal
funding, and lack of supervision—results in an agency too sequestered for the
Constitution to bear. Id. at 674.

                          III. COLLINS (EN BANC) CONTROLS
      The CFPB and FHFA are sister institutions. Only a judge who plays
“semantic games of reformulation and hair splitting in order to escape the force
of a fairly resolved issue” can conclude, as a matter of constitutional law, that
the agencies are sufficiently different. 31 Quite the contrary. The only material
distinctions magnify—not reduce—the extent of the CFPB’s infirmity.

                                     A. Same Structure
      First, consider the agencies’ twin structures. Both are captained by a
lone Director, with a resulting lack of bipartisan balance. 32 Each Director
serves a five-year term and has removal protections for her duration in office. 33

      31 Bhandari v. First Nat. Bank of Commerce, 829 F.2d 1343, 1352 (5th Cir. 1987) (en
banc) (Higginbotham, J., concurring), cert. granted, judgment vacated, 492 U.S. 901 (1989),
and opinion reinstated, 887 F.2d 609 (5th Cir. 1989) (per curiam).
      32   See 12 U.S.C. §§ 4512(a), 5491(b)(1).
      33   See id. § 5491(c)(1), (3) (CFPB); id. § 4512(b)(2) (FHFA).
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                                       No. 18-60302
And each agency is funded outside congressional appropriations. 34 The Bureau
thus enjoys the identical structural insulation that we held unlawful in Collins.
The glove fits.

                                     B. More Power
       The CFPB’s structure mirrors the FHFA, but the breadth of its power is
far greater. That is important, because the scope of the CFPB’s authority is a
crucial variable in the constitutional equation. 35 We must analyze the degree
to which a removal restriction interferes with the President’s obligation to
execute the law. Morrison, 487 U.S. at 691–92. That necessarily invokes an
inquiry into the agency’s powers, because what an independent officer receives,
the President loses. 36

       The interference with the President’s duties is widespread and punish-

       34See id. §§ 4516(a), 5497. It’s true that if the CFPB needs more money than the Fed’s
budget can handle, it must seek extra rations from Congress, see id. § 5497(e), and that the
FHFA’s statute had no similar provision, see id. § 4516. But that difference is insignificant,
given the Fed’s hefty budget. Indeed, in recent years, the CFPB has needed much less fund-
ing than that to which it was entitled. See CFPB, Fiscal Year 2019: Annual Performance
Plan and Report, and Budget Overview 7 (Feb. 2019), https://perma.cc/RLH2-HTHH. And
the CFPB only needs to seek any extra funds from Congress, not the whole lot. See 12 U.S.C.
§ 5497(e)(1).
       35See, e.g., Morrison, 487 U.S. at 691 (emphasizing, in upholding removal restriction,
the independent counsel’s “limited jurisdiction and tenure” and lack of “significant adminis-
trative authority”). My focus on the scope of the agency’s power does not ignore the tradition
of independence for financial regulators, a theme amply reviewed in PHH, 881 F.3d at 91–
92, 102. That such independence is traditional does not mean it passes muster in every case.
Indeed, the Public Company Accounting Oversight Board was a financial regulator, yet the
Court found its removal protections unconstitutional. See Free Enter. Fund, 561 U.S. at 508.
Congress has scarcely given as much power to an independent financial regulator as it has
to the CFPB, let alone housed all of that power in one individual. That triggers the central
constitutional question.
       36 See 12 U.S.C. § 5512(b)(4)(A) (granting the CFPB nearly exclusive authority to issue
rules under the laws it administers); see also PHH, 881 F.3d at 172 (Kavanaugh, J., dissent-
ing) (pointing out that, within her jurisdiction, the CFPB Director has more power than does
the President).
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ing. It dominates anything Congress did in creating the FHFA, which is saying
something. Indeed, the FHFA’s ability to take over Fannie and Freddie is a
considerable source of authority, and the agency wields multiple governmental
powers. But the FHFA’s jurisdiction still pales. That agency supervises two
entities; the CFPB regulates a major chunk of American commerce. 37 Congress
handed the Director the keys to eighteen consumer-protection laws, including
such landmark statutes as the Truth in Lending Act, the Fair Debt Collection
Practices Act, and the Fair Credit Reporting Act. See 12 U.S.C. § 5481(12).
Her powers touch banking, home finance, credit cards, and consumer loans.
See id. She “is the regulator of first resort and the primary law enforcement
authority for a vital sector of our economy.” Free Enter. Fund, 561 U.S. at 508.

       And the Director can exercise those powers unilaterally, because she
alone is at the helm. Indeed, the Director’s solitary status not only contributes
to her insulation; it also magnifies her powers.

       There is a reason, after all, that our Founders vested the executive power
in one President. See U.S. CONST. art. II, § 1, cl. 1. They recognized that a
single magistrate could act with greater energy, speed, and effectiveness in
carrying out his duties. 38 “The first thing which strikes our attention is, that
the executive authority, with few exceptions, is to be vested in a single magis-
trate.” 39 “Decision, activity, secrecy, and d[i]spatch, will generally characterize

        See Zywicki, supra, at 874 (“[T]he CFPB director performs an enormous policy-
       37

making function by controlling the flow and terms of consumer credit in the American
economy.”).
       38 See, e.g., THE FEDERALIST NO. 70, at 363 (Hamilton) (Liberty Fund ed. 2001) (“That
unity is conducive to energy, will not be disputed.”); GORDON S. WOOD, THE CREATION OF THE
AMERICAN REPUBLIC: 1776–1787, at 430–33 (1998) (describing the Founding generation’s
growing conviction, during the years leading up to the adoption of the federal Constitution,
that legislative abuses needed to be curbed in part by strengthening and unifying the
executive power).
       39   THE FEDERALIST NO. 69, at 355. Although today we use the word “magistrate” to
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the proceedings of one man, in a much more eminent degree than the proceed-
ings of any greater number; and in proportion as the number is increased,
these qualities will be diminished.” 40 “Those politicians and statesmen who
have been the most celebrated for the soundness of their principles, and for the
justness of their views, have declared in favour of a single executive . . . .”41
“[A]ttaching ourselves purely to the dictates of reason and good sense, we shall
discover much greater cause to reject, than to approve, the idea of plurality in
the executive . . . .” 42

       The same logic demonstrates that the Director’s solo status increases her
powers and therefore also interferes more with the President’s. “Wherever two
or more persons are engaged in any common enterpri[s]e or pursuit, there is
always danger of difference of opinion.” 43 The Director faces no such danger.
Unencumbered by the need to cobble together a majority, the Director acts with
greater speed and scope. 44 The result is more for her to do and less for the
President. Unitary power is more explosive than power diffused. 45

refer to a judge, the Founders assigned that term, as well, to executive officers. See, e.g., THE
FEDERALIST NO. 48, at 257 (Madison) (referring to “executive magistrates” and “the executive
magistracy” and “an hereditary magistrate” when discussing the role of the President under
Article II).
        40 THE FEDERALIST NO. 70, at 363; see Myers, 272 U.S. at 116 (“The debates in the

Constitutional Convention indicated an intention to create a strong Executive, and after a
controversial discussion the executive power of the Government was vested in one person[.]”).
       41   THE FEDERALIST NO. 70, at 363.
       42   Id. at 364.
       43   Id.
       44See PHH, 881 F.3d at 184 (Kavanaugh, J., dissenting) (“A multi-member indepen-
dent agency can go only as far as the middle vote is willing to go.”); Zywicki, supra, at 878
(observing that the CFPB’s single-Director structure eliminates “collegial decisionmaking,”
resulting in “tunnel vision”).
       45 Alexander Hamilton believed as much. See THE FEDERALIST NO. 70 (Hamilton),
at 366 (arguing against an executive council and in favor of a single magistrate, because “the
mere diversity of views and opinions” in the former “would alone be sufficient to tincture the
exercise of the executive authority with a spirit of habitual feebleness and dilatoriness”).
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      In exercising unilateral authority, very little constrains the Director. As
one example, she has the ability—subject only to narrow limits in 12 U.S.C.
§ 5531(c) and (d)—to prohibit any practice in consumer finance that she deems
“unfair, deceptive, or abusive.” Id. § 5531(b). The Director already has juris-
diction over eighteen statutes designed to protect against various forms of
abuse and deception. See id. § 5481(12). But, in section 5531, her authorities
extend yet further. Even casual observers of human nature will note its genius
in plotting creative ways to deceive. Consumer finance is no exception. The
CFPB’s powers extend as far as the imagination will take them.

                             C. Inconsequential Differences
      The only relevant structural difference between the agencies—the
FSOC—is overtly pedestrian. Undeterred, the majority stubbornly asserts
that the FSOC’s presence somehow makes the CFPB accountable. Not so.

      The FSOC’s primary authority consists in its narrowly circumscribed
ability to veto the CFPB’s rulemakings. See id. § 5513(a). The Council’s ten
voting members include the Secretary of the Treasury, the Comptroller of the
Currency, a member appointed by the President, and the chairs of seven inde-
pendent agencies, including the CFPB itself and the FHFA. Id. § 5321(b)(1).
The President appoints each of those to his or her respective office. 46 They may
exercise the veto only by a supermajority vote and only where the rule threat-
ens “the stability of the financial system of the United States.”                       Id.
§ 5513(c)(3)(A), (B)(ii).

      The majority accurately notes that Collins relied on the FSOC in point-
ing out differences between the FHFA and the CFPB. 47 That, the majority

      46   See PHH, 881 F.3d at 120 n.3 (Wilkins, J., concurring).
      47   See Collins, 896 F.3d at 669–70, 672–74.
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brags, shows that Collins could not possibly control. But it is hard to think of
a better example of dictum, defined as that which “could have been deleted
without seriously impairing the analytical foundations of the holding,” 48 than
the en banc court’s discussion of the CFPB. The Bureau’s constitutionality was
not before it.

        “We are not bound by dicta, even of our own court.” United States v.
Becton, 632 F.2d 1294, 1296 n.3 (5th Cir. 1980). Distinguishing the CFPB was
plainly not a pillar upon which Collins stood or fell, but only an observation by
some judges to show that they were focusing on the particulars of the agency
at issue. To suggest—rightly or wrongly—that one agency may be less consti-
tutionally infirm than another is not to say that one is sick and the other is
well.

        Today’s majority thus tiptoes around Collins’s holding but drives a truck
through its dictum. That is how you turn an “analysis on its head.” Wood v.
Collier, 836 F.3d 534, 541 (5th Cir. 2016) (Higginbotham, J.).

        The FSOC cannot save the CFPB from its hour of trouble, no matter how
badly the majority wishes it were so. It is hard to imagine an oversight council
with less capacity to oversee.

        To start, the FSOC can set aside only the Director’s rulemakings and has
no authority over the agency’s enforcement actions or adjudications. 49 That
matters. It is a foundational principle of administrative law that agencies can
forgo rulemaking and instead make substantive policy by adjudicating and

        48Netsphere, Inc. v. Baron, 799 F.3d 327, 333 (5th Cir. 2015) (Higginbotham, J.) (quot-
ing United States v. Segura, 747 F.3d 323, 328 (5th Cir. 2014)).
       49 See 12 U.S.C. § 5513(a); see also PHH, 881 F.3d at 159 (Henderson, J., dissenting)

(“As far as the Council is concerned, then, the CFPB can break the law or abuse its power as
long as it does so (1) in an enforcement action or (2) in a regulation that does not threaten
national financial ruin.”).
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bringing enforcement actions. 50 Some do almost all of their policymaking via
those means, 51 and the CFPB has taken advantage of its Chenery II preroga-
tives. 52 The FSOC can do nothing about any of it. Its lack of authority over
adjudications and enforcement leaves a gaping hole in its supposed oversight
of the CFPB’s policymaking.

       And even within the rulemaking category, the Council must defeat sig-
nificant procedural and substantive hurdles. The main procedural one is the

       50 See SEC v. Chenery Corp. (“Chenery II”), 332 U.S. 194, 203 (1947) (“[T]he choice
made between proceeding by general rule or by individual, ad hoc litigation is one that lies
primarily in the informed discretion of the administrative agency.”); see also Kevin M. Stack,
The Constitutional Foundations of Chenery, 116 YALE L.J. 952, 1000 (2007) (“[It is] well-
established doctrine (established, indeed, by Chenery II) that an agency generally has broad
discretion to choose how to implement a statutory grant of power, whether through rule-
making or through adjudication.”); Neomi Rao, Removal: Necessary and Sufficient for Presi-
dential Control, 65 ALA. L. REV. 1205, 1250 (2014) (“Often a statute will leave an agency with
discretion about whether to proceed through rulemaking or adjudication and the Court has
held that such discretion rests with the agency.”).
       51 The NLRB is the most notorious example. See, e.g., Charlotte Garden, Toward
Politically Stable NLRB Lawmaking: Rulemaking vs. Adjudication, 64 EMORY L.J. 1469,
1471 (2015) (“For decades now, academics and courts have been calling on the [NLRB] . . . to
use its rulemaking authority, rather than relying nearly exclusively on announcing legal
principles through adjudication.”).
       52 Indeed, the CFPB has taken heat for engaging in “regulation by enforcement”
instead of issuing rules. Recall that its power to prohibit consumer-finance practices that are
“abusive” is new in consumer protection. See Zywicki, supra, at 918. Title X provides some
color as to what “abusive” means, see 12 U.S.C. § 5531(d), but many have called for a rule-
making to provide more detail, see, e.g., Daniel Press, Consumer Financial Protection Bureau
Should Define ‘Abusive’, COMPETITIVE ENTER. INST. (June 5, 2019), https://perma.cc/6T8U-
S8RV.
        The clamor was loud enough that Acting Director Mick Mulvaney testified that the
Bureau would cease its practice of “regulation by enforcement.” He explained that “people
will know what the rules are before the Bureau accuses them of breaking those rules.” The
Consumer Financial Protection Bureau’s Semi-Annual Report to Congress: Hearing Before the
Comm. on Banking, Hous., and Urban Affairs, U.S. Senate, 115th Cong. 46 (April 12, 2018)
(statement of Mick Mulvaney, Acting Director), available at https://perma.cc/V6UT-3FYS.
The Bureau provided those seeking clarity a half victory, as it issued a policy statement that
purports to “provide[] a framework for the Bureau’s exercise of its supervisory and enforce-
ment authority to address abusive acts or practices.” See Statement of Policy Regarding
Prohibition on Abusive Acts or Practices, CFPB (Jan. 24, 2020), available at
https://perma.cc/JXA5-ALTE.
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requirement of a supermajority vote. 12 U.S.C. § 5513(c)(3)(A). One of the
voting members is the Director, and presumably she is unlikely to cast a ballot
wiping away a rule that she has just promulgated. Id. § 5321(b)(1)(D). In
practical effect, then, a veto happens only if seven of nine are interested.

         The FSOC also cannot eliminate whatever rule it wishes. Instead, it can
step in only where the new law would endanger “the safety and soundness” of
the entire national financial system. Id. § 5513(a). Such an “extreme test will
rarely be satisfied in practice,” 53 and if the Council misapplies it, judicial
review is available. 54 In sum, the FSOC’s veto can override only one of the
CFPB’s three governmental functions (rulemaking), and, within that category,
its power is procedurally and substantively restrained.

         There’s more. If, as the majority claims, the FSOC’s presence makes the
CFPB lawful when the FHFA was infirm, then it must be that the President
can oversee the Council. But the President’s capacity to do so is predictably
scant.

         For one, not every President will get to appoint each of its voting mem-
bers, because some have terms longer than four years. See PHH, 881 F.3d at
120 n.3 (Wilkins, J., concurring). And if the President disagrees with the
FSOC’s exercise of discretion, he faces a difficult choice. If he wants to fire one
of its members, such will also require removing the member from his main
executive office, since nine of the ten members sit on the FSOC ex officio.
12 U.S.C. § 5321(b)(1).

          Zywicki, supra, at 875; but see Rachel E. Barkow, Insulating Agencies: Avoiding
         53

Capture Through Institutional Design, 89 TEX. L. REV. 15, 75 (2010) (contending that “the
threat of veto” is “a real one”).
         See 12 U.S.C. § 5513(c)(8) (“A decision by the Council to set aside a regulation pre-
         54

scribed by the Bureau . . . shall be subject to review under [the Administrative Procedure
Act].”).
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       If, for example, the President is frustrated enough with the Chairman of
the SEC’s performance on the FSOC to want to dismiss him, the President
must banish him from his perch atop the Commission to do so. 55 That is a
significant disincentive to removal.          So, the FSOC’s oversight is narrowly
cabined, and the President’s oversight of the overseer is itself narrowly con-
strained. The Council gives the President very little control.

       In the final analysis, that Congress felt a need to create the FSOC
reveals what is ultimately the Bureau’s root problem: its vast, unaccountable
authority. 56 Congress apparently worried that it had “created a monster by
handing an agency breathtakingly broad powers and insulating the[ir] exer-
cise.” Saxton v. FHFA, 901 F.3d 954, 963 (8th Cir. 2018) (Stras, J., concurring).
The FSOC was Congress’s measured response: a body that can step in, but only
when the stability of the entire economy hangs in the balance. The Council’s
authority sweeps no further.

                                    *    *    *    *    *

       In Collins, the en banc court confronted a powerful agency that merged
several insulating features, including a single Director, removal protection,
and abnormal funding. Those features, we held, combined to violate the sepa-
ration of powers. Twelve of sixteen agreed.

       This three-judge panel now faces a much more powerful agency assem-
bled in the very same way. Yet the two-judge majority holds the very opposite,

       55  See id. § 5321(b)(1)(E) (establishing that the Chairman of the SEC shall serve as a
voting member on the FSOC).
        56 See PHH, 881 F.3d at 160 (Henderson, J., dissenting) (“The fact that anyone men-

tions the Council’s narrow veto as a check is instead a testament to the CFPB’s unaccountable
policymaking power.”).
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relying, as it must, on distinctions without a difference. So much for “the role
of settled judicial rules.” 57 The “patent refusal to apply well-established law in
a neutral way is indefensible.” 58

       The judges in today’s majority desperately search for anything—
anything at all—that might excuse the obligation to apply the law. By counting
to two, they succeed. Collins does not deserve the death sentence it now
receives. I respectfully dissent.

       57   June Med. Servs., 905 F.3d at 816 (Higginbotham, J., dissenting).
       58  June Med. Servs., 913 F.3d at 585 (Higginson, J., dissenting from the denial of re-
hearing en banc) (quoting Whole Woman’s Health v. Hellerstedt, 136 S. Ct. 2292, 2331 (2016)
(Alito, J., dissenting), as revised (June 27, 2016)).
                                               36