The Fifth Circuit has entered an order staying the compliance date of the payment provisions in the CFPB’s 2017 final payday/auto title/high-rate installment loan rule (2017 Rule) until 286 days after the trade groups’ appeal is resolved.

The trade groups have appealed from the district court’s final judgment granting the CFPB’s summary judgment motion and staying the compliance date for the payment provisions until 286 days after August 31, 2021 (which date is June 13, 2022).  After the district court denied their request for a stay of the compliance date until 286 days after their appeal is fully and finally resolved, the trade groups filed a motion with the Fifth Circuit seeking the same relief.

The trade groups’ primary argument is that the 2017 Rule was void ab initio because the CFPA’s unconstitutional removal restriction means that the Bureau did not have the authority to promulgate the 2017 Rule.  In opposing the trade groups’ motions to extend the stay in the district court and the Fifth Circuit, the CFPB asserted that the trade groups’ had not established that they are likely to succeed on the merits of that argument because the U.S. Supreme Court held in Collins that agency actions are not rendered void by the mere existence of an invalid removal restriction and numerous courts of appeals have rejected similar arguments.

The district court, in its order denying the trade groups’ motion to extend the stay, stated that it had considered the four factors that are relevant when courts consider a request for a stay pending resolution of an appeal and found that the trade groups had failed to make a sufficient showing to warrant a stay.  Such factors include a strong showing of likely success on the merits.  It also found that the equities did not support extending the stay of the compliance date beyond the court’s 286-day stay from August 30, 2021.  The Fifth Circuit gave no reasons for its decision to extend the stay as requested by the trade groups.