In a significant legal development, a panel of the U.S. Court of Appeals for the District of Columbia Circuit has granted President Donald Trump’s administration the authority to proceed with substantial cuts to the workforce of the Consumer Financial Protection Bureau (CFPB). The decision overturns a preliminary injunction that had been issued by a lower court, which had temporarily halted mass layoffs.
The 2-1 ruling by the appellate panel reverses an order from U.S. District Court Judge Amy Berman Jackson, who had initially issued the injunction in March. Her order was intended to keep the agency intact while the court heard a lawsuit filed by the National Treasury Employees Union on behalf of CFPB employees.
This ruling represents a win for the Trump administration, which has consistently sought to reduce the size and scope of the CFPB, an agency established by Congress in 2010 to protect consumers.
Writing for the majority, Judge Gregory G. Katsas — a Trump appointee — asserted that the district court did not have the proper jurisdiction to consider the employment-related claims, which he stated must be handled through a civil service review process. He further argued that the lawsuit was “not viable” under the Administrative Procedure Act, as it did not challenge a specific, “discrete, final agency action.”
Judge Neomi Rao, another Trump appointee, concurred with the majority. In her dissent, Judge Cornelia Pillard, an Obama appointee, contended that the administration’s actions in the case could only be understood as an attempt at “the willful destruction of a congressional created agency.” She also disputed the majority’s finding on jurisdiction, stating that courts should not be “powerless” to prevent a president from dismantling federal agencies.
The case may not be concluded, as there remains the possibility of an appeal to the full D.C. Circuit Court of Appeals or to the Supreme Court.
For more information, email Lisa Quaranta.
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