Defendants In CFPB Enforcement Action Renew Challenge To Validity Of Director’s Appointment

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On February 11, a law firm and related parties sued by the CFPB for allegedly deceiving consumers through a network of mortgage loan modification businesses filed a brief in which they renewed a challenge to the CFPB Director’s appointment. Opp. to Receiver’s Request for Payment, CFPB v. Chance Edward Gordon, No. 12-6147 (C.D. Cal., filed Feb. 11, 2013). The defendants cite a recent opinion from the U.S. Court of Appeals for the D.C. Circuit that held appointments to the National Labor Relations Board made by President Obama in January 2012 during a purported Senate recess were unconstitutional, and argue that CFPB Director Cordray was appointed on the same day, and in the same manner found to be constitutionally invalid by the D.C. Circuit Court. The defendants stated in their motion that they have propounded Requests for Admissions regarding the date and nature of Mr. Cordray’s appointment, and likely will follow with a motion for summary judgment.