Washington Post colleague Suzy Khimm reports that the Competitive Enterprise Institute (CEI), a small Texas bank and another conservative organization have filed a lawsuit against the Consumer Financial Protection Bureau, arguing that its powers and President Obama’s recess appointment of Richard Cordray as its director are unconstitutional.
The State National Bank of Big Spring, Tex., the Competitive Enterprise Institute and the 60 Plus Association, a conservative advocacy group for seniors, claim that Dodd-Frank effectively gives “unbounded power to the CFPB,” resulting in “unprecedented violations of ‘the basic concept of separation of powers’ ” laid out in the Constitution.
The lawsuit also alleges that President Obama’s recess appointment of CFPB Director Richard Cordray was unconstitutional because it did not happen during an official Senate recess. Finally, it claims that the new Financial Stability Oversight Council is also unconstitutional for having “sweeping power and effectively unbridled discretion” to determine which banks are “too big to fail” and thus subject to greater oversight.
This may strike some as odd: Why would a policy-oriented think tank be getting involved in litigation?
The Competitive Enterprise Institute is one of a small number of think tanks that have a litigation arm to their organization.
And they’re serious about it.
A message from CEI Center for Law and Litigation Director Sam Kazman says:
Mankind’s ability to innovate is boundless. Unfortunately, so is government’s ability to regulate. CEI’s Center for Law and Litigation focuses on developing new approaches to fight overregulation. In areas ranging from our successful constitutional challenge to Sarbanes-Oxley, to overturning federal fuel economy standards, CEI has already established major new precedents for combating regulations that restrict consumer choice, stifle innovation, and limit competition. And we’re just getting started.