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State National Bank of Big Spring v. Mnuchin

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Supreme Court of the United States
State National Bank of Big Spring. et al. v. Steven T. Mnuchin, Secretary of the Treasury, et al.
Docket number: 18-307
Term: 2018
Court membership
Chief Justice John G. Roberts • Clarence Thomas • Ruth Bader Ginsburg • Stephen Breyer • Samuel Alito • Sonia Sotomayor • Elena Kagan • Neil Gorsuch • Brett Kavanaugh


Note: This page was created because a U.S. Supreme Court decision in the case could have required significant changes to the structure of federal agencies and to the civil service protections enjoyed by agency leadership. Since the court decided not to hear the case, Ballotpedia will not update this page further.

State National Bank of Big Spring v. Mnuchin, a case that did not appear before the United States Supreme Court, asked whether the Consumer Financial Protection Bureau (CFPB) established by the Dodd-Frank Act in 2010 had an unconstitutional structure. In addition, some amicus curiae briefs asked the court to consider whether the 1935 case Humphrey's Executor v. United States should be overturned and whether the constitution allowed the CFPB to draw funding from other independent agencies.[1][2][3]

The petition for a writ of certiorari was filed on September 6, 2018 and was denied on January 14, 2019.[1]

HIGHLIGHTS
  • The case: The petitioners, made up of a bank, a think tank, and a seniors advocacy group, sued arguing that the provisions of the Dodd-Frank Act that created the CFPB were unconstitutional.
  • The issues: (1) Whether the part of the Dodd-Frank Act that created the CFPB violated the principle of separation of powers in the United States Constitution.


    (2) Whether Humphrey's Executor v. United States should be overturned.

    (3) Whether the United States Constitution authorizes Congress to create funding streams for executive agencies that are drawn from other independent agency accounts without review by Congress.[4]

  • The outcome: The U.S. Supreme court denied certiorati on January 14, 2019.[1]


    • Why it matters: The case challenged the structure of the CFPB and other independent agencies that Congress might create.

    You can review the lower court's opinion here.[5]

    Background

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    Case background

    See also: Humphrey's Executor v. United States

    In PHH Corp. v. CFPB, decided en banc by the DC Circuit in January 2018, the court cited Humphrey's Executor v. United States to affirm the constitutionality of the structure of the Consumer Financial Protection Bureau (CFPB). Specifically, the majority relied on history and precedent to uphold limits to the removal power the president wields over the head of the CFPB.[5]

    “ We granted en banc review to consider whether the federal statute providing the Director of the Consumer Financial Protection Bureau (CFPB) with a five-year term in office, subject to removal by the President only for 'inefficiency, neglect of duty, or malfeasance in office,' is consistent with Article II of the Constitution, which vests executive power 'in a President of the United States of America' charged to 'take Care that the Laws be faithfully executed'. Congress established the independent CFPB to curb fraud and promote transparency in consumer loans, home mortgages, personal credit cards, and retail banking. The Supreme Court eighty years ago sustained the constitutionality of the independent Federal Trade Commission, a consumer-protection financial regulator with powers analogous to those of the CFPB. Humphrey’s Executor v. United States, 295 U.S. 602 (1935). In doing so, the Court approved the very means of independence Congress used here: protection of agency leadership from at-will removal by the President. The Court has since reaffirmed and built on that precedent, and Congress has embraced and relied on it in designing independent agencies. We follow that precedent here to hold that the parallel provision of the Dodd-Frank Wall Street Reform and Consumer Protection Act shielding the Director of the CFPB from removal without cause is consistent with Article II.[6][7] ”

    What is the removal power?

    See also: Appointment and removal power (administrative state)

    Appointment and removal power, in the context of administrative law, refers to the authority of an executive to appoint and remove officials in the various branches vested in its authority to do so. In the context of the federal government, the Appointments Clause of the United States Constitution vests the president with the authority to appoint officers of the United States, including federal judges, ambassadors, and Cabinet-level department heads. Congress may authorize the president, the courts, or the heads of departments to appoint inferior officers, including federal attorneys, chaplains, and federal election supervisors, among other positions. The president has the authority to remove his appointees from office, but the heads of independent federal agencies can only be removed for cause.

    See also

    External links

    Footnotes

    1. ↑ 1.0 1.1 1.2 Supreme Court of the United States, "State National Bank of Big Spring. et al., Petitioners v. Steven T. Mnuchin, Secretary of the Treasury, et al.," accessed October 29, 2018
    2. ↑ Supreme Court of the United States, "Brief of Amicus Curiae The Buckeye Institute for Public Policy Solutions in Support of Petititoners," October 9, 2018
    3. ↑ Supreme Court of the United States, "Brief of Amicus Curiae Landmark Legal Foundation in Support of Petititoners," October 9, 2018
    4. ↑ Supreme Court of the United States, "State National Bank of Big Spring. et al., Petitioners v. Steven T. Mnuchin, Secretary of the Treasury, et al., Respondents, Petition for a Writ of Certiorari," accessed January 15, 2019
    5. ↑ 5.0 5.1 United States Court of Appeals for the District of Columbia Circuit, "PHH Corportation et al., v. Consumer Financial Protection Bureau," January 31, 2018
    6. ↑ Internal citations and quotations have been omitted
    7. ↑ Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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