Not a Lexis+ subscriber? Try it out for free.

Banking and Finance

Supreme Court Agrees To Hear Recess Appointment Case: Does SCOTUS Hold Cordray’s Fate In Its Hands?

 by Jeffrey E. Jamison

The Supreme Court surprised no one late in June when it agreed to wade into the controversy over President Obama’s recess appointments to the National Labor Relations Board and, by extension, Richard Cordray’s appointment as director of the CFPB. The Supreme Court announced that it would hear National Labor Relations Board v. Noel Canning (docket 12-1281) and define when a President can file a vacant government post without the consent of Congress, a.k.a. a recess appointment. While not explicitly subject to the Canning decision, the validity of Cordray’s appointment is the subject of another case currently before the D.C. Circuit Court of Appeals, which a Supreme Court decision in Canning could resolve.  

In Canning, the D.C. Circuit Court of Appeals ruled that President Obama’s recess appointments to the National Labor Relations Board [an enhanced version of the D.C. Circuit Court opinion is available to subscribers], which took place on the same day as Richard Cordray’s appointment as Director of the CFPB, were unconstitutional because the vacancies and appointments did not take place between sessions of Congress. The Supreme Court not only announced its intention to resolve the dispute over these appointments, but also signaled that it intends to address and settle the larger issue recess appointment by establishing what does and does not constitute a “recess.” In addition to the questions presented in the petition for certiorari, the Supreme Court asked the parties to address the question: “Whether the President's recess-appointment power may be exercised when the Senate is convening every three days in pro forma session.” Some commenters have suggested that, if the Supreme Court upholds the Canning decision in total, it could invalidate over 300 recess appointments since 1981. 

Of course, with Cordray's nomination still pending before the Senate and rumors of a possible compromise swirling on Capitol Hill, it is possible that a political solution could resolve the issues involving Cordray's appointment in advance of a decision by the Supreme Court. 

Stay tuned as we follow the Canning case and Cordray's nomination.  

Read more articles about the Consumer Financial Protection Bureau at Dykema’s CFPB Blog

For more information about LexisNexis products and solutions connect with us through our corporate site.