Not surprisingly, the many media and political reactions to the PHH Corp. v. CFPB decision have reflected the competing stakeholder interests around every aspect of the CFPB.In this memorandum, we step back a bit and make some observations about the strategic choices facing the CFPB, the Obama Administration, the next President, and the next Congress in light of the decision.  We begin with a short review of the tension between the two contradictory Supreme Court cases upon which the federal administrative state is built and explain how they informed the D.C. Circuit’s invalidation of the CFPB’s independent structure.  We then discuss the D.C. Circuit’s statutory interpretation, which we believe will have wide implications across a range of regulatory enforcement actions, both in the financial sector and beyond. We also discuss the extent to which the D.C. Circuit’s ruling may raise questions as to the validity of past or pending CFPB rulemaking and enforcement actions. Finally, we end with an exploration of the considerations behind the possible next steps by the CFPB and other stakeholders.

If you have any questions regarding the matters covered in this publication, please reach out to any of the lawyers listed below or your usual Davis Polk contact.

This communication, which we believe may be of interest to our clients and friends of the firm, is for general information only. It is not a full analysis of the matters presented and should not be relied upon as legal advice. This may be considered attorney advertising in some jurisdictions. Please refer to the firm's privacy notice for further details.

Related materials

Read the full update
Copy link to share post