Legal Battle Over Mass Firing at CFPB Paused by Government Shutdown

A legal battle over the Trump administration’s mass firings of staff at the Consumer Financial Protection Bureau is reportedly on hold because of the government shutdown.

The administration has asked for a stay on a rehearing in the case because the relevant Justice Department employees are not allowed to work during the shutdown, Federal News Network reported Wednesday (Oct. 22).

Prior to that request, the latest actions in the case were a 2-to-1 vote by a D.C. Court of Appeals panel that said the administration could proceed with the reductions in force, and then a filing by the plaintiffs calling for a rehearing that would involve all the judges rather than the three-judge panel, according to the report.

The administration’s request for a stay followed that filing, per the report.

“One interesting thing that we’ll have to see, though, is the courts themselves,” Rich Andreano, a partner at Ballard Spahr, told Federal News Network. “Apparently, they have funding to last sometime into November. If we get to the point they run out of funds, do we have no judges to hear cases at that point? So, it could, if this is an extended one, it could get quite interesting to see what happens at that point.”

It was reported on Feb. 9 that Russell Vought, head of the Office of Management and Budget and acting director of the CFPB, told the financial regulator’s staff to halt “all supervision and examination activity” and “all stakeholder engagement,” more or less shutting down the CFPB’s operations.

“As acting director, I am committed to implementing the president’s policies, consistent with the law, and acting as a faithful steward of the bureau’s resources,” Vought said in an email delivering those orders, per the report.

A mass firing of employees at the CFPB followed before being paused by a lawsuit challenging the dismantling of the regulator.

It was reported Thursday (Oct. 16) that Vought said he intends to shut down the CFPB. He said at the time that only a few employees remain at the agency’s Washington headquarters “while we close down the agency” and added that “we will be successful probably within the next two or three months.”