DOJ's appeal of CFPB injunction gets Trump-heavy panel

Bloomberg News

UPDATE: This article includes the assignment of oral arguments to a three-judge panel in appeals court.

The U.S. Court of Appeals for the D.C. Circuit has assigned a three-judge panel, with two judges appointed by President Donald Trump, to hear an appeal of a preliminary injunction blocking the administration from dismantling the Consumer Financial Protection Bureau.

Oral arguments have been scheduled on April 9 before Judges Gregory Katsas and Neomi Rao, both Trump appointees, and Cornelia Pillard, who was appointed by President Obama.

On Wednesday, Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia denied the DOJ's appeal of a preliminary injunction she issued last Friday. The Trump administration called the injunction "sweeping and intrusive requirements" that have "no plausible basis in the CFPB's organic statute or any other identified statute."

In its request Tuesday, the Justice Department disputed evidence presented in a two-day evidentiary hearing before Berman Jackson last month. The DOJ said Berman Jackson's belief that the CFPB would be dissolved and dismantled in 30 days was "incorrect" and based on "outdated evidence" that has since been "clarified by the current agency leadership."

The DOJ also claimed that the CFPB should operate with fewer employees, based on the agency's funding cap from the Federal Reserve Board. 

"When it was founded, the agency was 'never supposed to' employ 'above 1,000 people,' " the DOJ stated. "The statutory cap is structured in a manner to provide funding for approximately 1,000 people, not the approximately 1,700 people that the CFPB currently employs. This court's injunction instead blocks standard workforce decision-making discretion, resource allocation decision-making discretion, and discretion to issue administrative directives retained by agencies that are not closing."  

Litigation

Union says DOJ appeals to wrong court over CFPB injunction

April 1, 2025 3:22 PM

The National Treasury Employees Union sued acting CFPB Director Russell Vought in February and, in a motion filed Tuesday, argued that the government filed its appeal in the wrong court, which the government corrected Tuesday.  

Deepak Gupta, who represents the NTEU, responded Wednesday by opposing the defendant's motion for a stay, which he said "relies on a fictional account of the facts that is entirely at odds with the findings of this Court."

At the evidentiary hearings in March, Gupta presented evidence showing that Vought and Mark Paoletta, the CFPB's chief legal officer, planned to fire 1,175 CFPB employees in a first round of layoffs. President Trump, presidential advisor Elon Musk and Vought have stated that the CFPB should be gutted, which Berman Jackson noted in her injunction.  

She said CFPB leaders had engaged in "a charade for the court's benefit" by authorizing a resumption of some work at the CFPB while laying plans behind the scenes to fire most of the bureau's employees and shut down the agency.

In the appeal, the DOJ repeated its now-debunked claims about a stop-work order instituted by Vought in February. 

"Agency leadership has repeatedly made clear that the intent of this pause was not to stop work in furtherance of statutory obligations, but rather to 'ensure that new leadership could establish operational control over the agency while ensuring that it would continue to fulfill its statutory duties,'" the motion stated.