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Publication Date

2014

Abstract

In 2010, the Court decided Free Enterprise Fund, engaging in a substantially formalist analysis of the President's removal power. That same year, Congress authorized creation of the Consumer Financial Protection Bureau, a federal agency with significant regulatory and enforcement power over the consumer finance industry. Within three years of that legislation, two lawsuits have challenged the CFPB's structure. This Note evaluates the arguments of the CFPB's opponents against the backdrop of Free Enterprise Fund and the Roberts Court's other formalist decisions. Although one might expect complaints against the CFPB to be lodged solely in formalist terms, the CFPB's opponents have not done so. Instead, they have grounded their claim in a highly functionalist argument, broadly alleging that the CFPB violates the constitutional system of checks and balances. According to this argument, no individual feature makes the CFPB unconstitutional; rather, the combination of various structural features as well as the agency's novelty renders it constitutionally infirm. This Note demonstrates that the CFPB satisfies two individual separation-of-powers principles, the removal power and the nondelegation doctrine. In subsequently analyzing the functionalist argument, it dissents language in Free Enterprise Fund portending new significance for agency novelty in separation-of-powers decisions. Yet, distinguishing the role of novelty in Free Enterprise Fund, it concludes that this language does not mean that the CFPB's opponents will prevail, for the functionalist novelty argument provides no rules to which a formalist court could look in determining whether the CFPB is unconstitutional and what makes it unconstitutional.

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