Jan. 28, 2013 – A federal appeals court opined last week that the president’s 2012 recess appointments to the National Labor Relations Board violated the Constitution, a ruling that may fuel the hopes of opponents of Richard Cordray’s similar appointment as CFPB director.
A three-judge panel ruled Friday that recess appointments are valid only if they are made when the Senate is out for an intersession recess, or specifically not in session. The three-day recesses or breaks that occurred in between several pro forma sessions don’t qualify, the court said. The NLRB appointments were made during one of those short breaks.
The government could seek another review by the appeals court, after which it could pursue the matter to the Supreme Court, reports said. Meanwhile, observers say this casts a bit of a shadow on Cordray’s appointment, which is being challenged in a separate case.
Carrie Hunt, NAFCU’s general counsel and vice president of regulatory affairs, said the ruling isn’t likely to change anything for credit unions in the near term, if at all. “Unfortunately, the impact of mortgage changes is coming even if there is more uncertainty later with respect to the CFPB structure or leadership,” she said.
NAFCU, seeking to prevent unnecessary new regulatory burdens for credit unions, has worked closely with Cordray and others at the bureau on rules affecting the cooperatives. It has meanwhile argued for changing the leadership structure at the CFPB from a single director to a five-member panel.
Cordray’s renomination by the president last week is meeting with mixed reviews, which are split down party lines.