Although it dealt with the Department of Labor’s (DOL) interpretation of a Fair Labor Standards Act (FLSA) regulation, the U.S. Supreme Court’s decision issued earlier this week in Christopher v. Smithkline Beecham Corp. has significant implications for the CFPB’s approach to amicus brief filings.
In announcing in March that it had filed an amicus brief in a 10th Circuit TILA rescission case, the CFPB stated that it was committed to filing amicus briefs in cases involving the federal consumer financial protection laws it oversees. At the time, we commented that the CFPB’s proactive approach stands in stark contrast to the approach taken by the Federal Reserve Board when it was charged with implementing federal consumer financial protection statutes such as TILA. When the Fed felt the courts were incorrectly interpreting the statute in question, the Fed would generally address the issue by proposing revisions to the implementing regulation or official staff commentary rather than by submitting an amicus brief.
The CFPB has since filed amicus briefs in other TILA cases involving the same rescission issue, several FDCPA cases, and a RESPA case. (The CFPB’s TILA interpretation has produced a circuit split and its RESPA interpretation was rejected by the U.S. Supreme Court.)
In Christopher, the Supreme Court ruled that the Ninth Circuit had properly refused to give deference to the DOL’s interpretation of the FLSA regulation at issue which the DOL advanced in an amicus brief. The DOL had first announced that interpretation in an uninvited amicus brief filed in a Second Circuit case involving the same regulatory issue. The Supreme Court observed that it would create the potential for “unfair surprise” to parties regulated by the DOL if a court were to defer to the DOL’s interpretation. According to the Supreme Court, “it is one thing to expect regulated parties to conform their conduct to an agency’s interpretations once the agency announces them; it is quite another to require regulated parties to divine the agency’s interpretations in advance or else be held liable when the agency announces its interpretations for the first time in an enforcement proceeding and demands deference.” The Supreme Court also observed that the DOL’s interpretation “lacks the hallmarks of thorough consideration,” noting the DOL’s use of amicus briefs to announce its interpretation precluded an opportunity for public comment.
We hope the Supreme Court’s decision will deter the CFPB from attempts to use amicus filings as a substitute for notice-and-comment procedures that ensure all views are adequately considered.