Banking and Finance Law Daily Wrap Up, CONSUMER FINANCIAL PROTECTION BUREAU—Amici brief urges full court to reverse injunction limiting CFPB operations, (Jan 22, 2026)

By Shashi Kant, BALLB, LLM.

The brief argues that the federal district court lacked jurisdiction and improperly supervised agency management, raising reviewability and separation-of-powers concerns.

Amici supporting the appellants urged the U.S. Court of Appeals for the District of Columbia Circuit, sitting en banc, to reverse a district court injunction restricting actions taken by Consumer Financial Protection Bureau Acting Director Russell Vought, arguing that the lower court lacked jurisdiction and improperly constrained executive authority (National Treasury Employees Union v. Vought, No. 25-5091 (D.C. Cir. Jan. 16, 2026)).

The en banc proceeding arises from litigation brought by the National Treasury Employees Union and allied plaintiffs challenging actions taken after Vought’s appointment as acting CFPB director in February 2025. The district court entered a preliminary injunction in March 2025 limiting workforce reductions and operational changes at the Bureau. A divided D.C. Circuit panel later vacated that injunction, and the full court granted rehearing en banc, vacated the panel judgment, and scheduled oral argument for Feb. 24, 2026, while leaving a partial stay pending appeal in effect (see Banking and Finance Law Daily, Dec. 18, 2025).

Position of amici supporting appellants. In their en banc submission, amici including America’s Future, Citizens United, Public Advocate of the United States, and related organizations argued that the district court exceeded its authority by assuming that reductions in force and operational limitations would necessarily cause the CFPB to violate congressionally assigned duties. According to the brief, the district court relied on speculation rather than identifying specific statutory duties that could not be fulfilled with a smaller workforce.The amici stated that the district court improperly treated internal emails and management directives as evidence of a decision to shut down the agency, even though those communications expressly permitted work required by law to continue. The brief cites emails from February and March 2025 instructing CFPB staff to limit activities to statutorily required functions and to continue such work where required.

Jurisdiction and reviewability. The amici argued that the district court lacked jurisdiction to review the plaintiffs’ claims under both the Civil Service Reform Act and the Administrative Procedure Act. According to the brief, employee claims challenging workforce reductions fall within the exclusive remedial framework of the CSRA, which assigns review to the Merit Systems Protection Board and, ultimately, the Federal Circuit, rather than to district courts.With respect to non-employee plaintiffs, the amici argued that the Administrative Procedure Act (APA) permits review only of discrete, final agency action. The brief states that plaintiffs challenged an inferred, overarching decision to shut down the CFPB rather than a final agency action that determined rights or obligations or from which legal consequences flowed. The amici cited Supreme Court precedent holding that informal communications and presidential actions do not constitute final agency action reviewable under the APA.

Separation-of-powers arguments. According to the amici, the district court improperly converted statutory claims into constitutional claims by asserting inherent authority to enjoin executive actions alleged to exceed statutory limits. The brief states that Supreme Court precedent distinguishes between claims that an official exceeded statutory authority and claims that an official acted unconstitutionally, and that exceeding statutory authority does not automatically give rise to a constitutional violation.The amici further argued that permitting district courts to supervise agency operations based on anticipated effects of workforce reductions undermines the constitutional allocation of authority among the branches of government. The brief states that historical practice reflects executive authority to conduct reorganizations and reductions in force, subject to statutory constraints established by Congress.

District court injunction. The amicus brief described the district court’s injunction as imposing extensive operational requirements on the CFPB, including restrictions on employee terminations, orders to reinstate terminated staff, directives to maintain consumer complaint systems, and prohibitions on contract terminations. According to the brief, these measures amounted to judicial supervision of day-to-day agency management.The amici stated that the district court did not identify any specific statutory duty that could not be performed under the management directives issued by CFPB leadership prior to the injunction. The brief argues that the injunction rested on assumptions about future noncompliance rather than completed violations of law.

Attorneys: Jennifer D. Bennett (Gupta Wessler LLP) for National Treasury Employees Union, National Consumer Law Center, National Association for the Advancement of Colored People, Virginia Poverty Law Center, Eva Steege, and CFPB Employee Association. Eric D. McArthur, Deputy Assistant Attorney General, U.S. Department of Justice, for Russell Vought and the Consumer Financial Protection Bureau.

Companies: America’s Future; CFPB Employee Association; Citizens United; Conservative Legal Defense and Education Fund; National Association for the Advancement of Colored People; National Consumer Law Center; National Treasury Employees Union; Public Advocate of the United States; Public Advocate Foundation; U.S. Constitutional Rights Legal Defense Fund; Virginia Poverty Law Center

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