Further Setback for the CFPB Director’s Authority?

A split panel of the U.S. Court of Appeals for the Third Circuit issued a decision yesterday holding that a “recess” appointment to the National Labor Relations Board (NLRB) was unconstitutional and invalid. NLRB v. New Vista Nursing and Rehabilitation, Nos. 11-3440, 12-1027, 12-1936 (3rd Cir. May 16, 2013). Like the District of Columbia Circuit Court’s ruling in Noel Canning v. NLRB, 705 F.3d 490 (2013), the Third Circuit ruled that the president’s authority to make “recess appointments” applies only to appointments made between sessions of Congress and does not apply to appointments made during congressional sessions. The ruling calls into question, yet again, the validity of the recess appointment of Richard Cordray to the CFPB.

The Third Circuit decision concerns an appointment to the NLRB made by President Obama during a two-week adjournment of the Senate in 2010. Although the District of Columbia Circuit’s ruling concerned a recess appointment in 2012, both courts reached the same conclusion. They held that the “recess appointments” clause in the Constitution applies only to breaks between sessions of the Senate (“intersession breaks”). It does not apply to breaks within sessions or breaks in Senate business that make the Senate unavailable to provide advice and consent (“intrasession breaks”).

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Topics:  CFPB, Directors, Nominations, Recess Appointments, Richard Cordray

Published In: Constitutional Law Updates, Consumer Protection Updates, Elections & Politics Updates, Finance & Banking Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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