Judge Amy Berman Jackson said that court intervention was ‘extraordinary’ but necessary and that the administration disregarded Congress’s intent.
A federal judge issued a preliminary injunction on March 28 preventing the Trump administration from continuing what she described as a shutdown of the Consumer Financial Protection Bureau (CFPB).
“If the defendants are not enjoined, they will eliminate the agency before the Court has the opportunity to decide whether the law permits them to do it, and ... the harm will be irreparable,” U.S. District Judge Amy Berman Jackson wrote in an
opinion.
Jackson said that court intervention was “extraordinary” but necessary and that the administration disregarded Congress’s intent.
Her
order requires the administration to reinstate all probationary and term employees terminated since Feb. 10 and prevents further terminations with some exceptions. It prohibits the administration from enforcing a stop-work order and requires it to maintain a website, hotline, and database of consumer complaints, as well as to respond to those complaints.
Jackson started her opinion with statements from Trump, White House adviser Elon Musk, and Office and Management Budget Director Russell Vought, who was named as a defendant in the initial lawsuit brought by a federal employees union. Each was critical of the agency or indicated an interest in reducing it.
“CFPB RIP,” Musk said in a
post to his social media platform X.
The
lawsuit accused the administration of violating the nation’s separation of powers through Vought’s decision to prevent the agency from drawing down funding or engaging in supervision and examination activities.
An
amended complaint, filed in February, included several other plaintiffs such as the CFPB Employee Association and the National Association for the Advancement of Colored People.
Congress created the CFPB in the wake of the 2008 financial crisis. It has supervisory authority over banks, thrifts, and credit unions with $10 billion or more in assets. Since then, it has been the subject of major Supreme Court rulings, including one that resulted in a ruling last year
upholding its controversial funding mechanism.
Administration attorneys attempted to ward off an injunction with a
long list of arguments, including that its actions fell under a form of discretion that was unreviewable by courts. For the judge to block the administration’s actions, they said, would violate the nation’s separation of powers.
“To override these principles and enjoin agency leadership from exercising procedural control over its own staff to ensure that staff is carrying out statutory obligations or otherwise exercising agency leadership’s policies would be an extraordinary violation of the separation of powers,” they said.
They described Vought’s actions as in line with one of Trump’s executive orders that
froze regulatory action so the administration could reevaluate the agency’s policies.
