On remand from the United States Supreme Court, the United States Court of Appeals for the Ninth Circuit, in Consumer Fin. Prot. Bureau v. Seila Law LLC, reaffirmed a District Court grant of a petition by the Consumer Financial Protection Bureau, Petitioner-Appellee, to enforce a civil investigatory demand issued to Seila Law LLC, Respondent-Appellant, requiring the production of documents and interrogatory answers.

The procedural history of the case evidences a climb up and down the jurisprudential ladder. In August 2017, the United States District Court for the Central District of California granted a petition by the CFPB to enforce a CID issued to Seila earlier that year. The United States Court of Appeals for the Ninth Circuit affirmed the District Court's decision. On appeal, however, the United States Supreme Court held that "the structure of the CFPB violate[d] the separation of powers. . . [but] the CFPB Director's removal protection is severable from the other statutory provisions bearing on the CFPB's authority." It held that, while the CFPB could "continue to operate," its Director "must be removable by the President at will." The Supreme Court vacated the Ninth Circuit's prior judgment and remanded the case.

At issue on remand was whether, in light of the Supreme Court's holding,

CFPB Acting Director Mick Mulvaney validly ratified the CID issued by the CFPB to Seila. During his time in office, Acting Director Mulvaney had been "improperly insulated from the President's removal authority."

The Ninth Circuit held that the CID was validly ratified, and reasoned that it need not determine whether Acting Director Mulvaney validly ratified the CID, as Kathleen Kraninger, the current director of the CFPB, "expressly ratified the agency's earlier decisions 'to issue the [CID] to [Seila], to deny [Seila's] request to modify or set aside the CID, and to file a petition requesting that the district court enforce the CID.'"

Seila contended that Director Kraninger's ratification was invalid for the following reasons: (1) the CFPB was exercising unlawful executive power prior to Supreme Court's invalidation of the for-cause removal provision, and Director Kraninger did not have authority to ratify prior unlawful actions; and (2) Director Kraninger's ratification was barred by the applicable statute of limitations for bringing enforcement actions. The Ninth Circuit rejected both of Seila's contentions in turn.

First, the Ninth Circuit reasoned that precedent set forth in Consumer Fin. Prot. Bureau v. Gordon and Federal Election Commission v. Legi-Tech, Inc. affirmed that "ratification is available to cure both Appointments Clause defects and structural, separation-of-powers defects." The Ninth Circuit emphasized that while the Supreme Court held that the "CFPB's 'structure' violated the separation of powers," the only constitutional defect the Supreme Court found was "the Director's insulation from removal," and the Supreme Court did not find that all prior CFPB actions were void. Therefore, the Ninth Circuit held, as Director Kraninger knew she could be removed by the President at-will at the time she ratified the CID, the ratification of the CID was effective. Second, it held that the statute of limitations period for enforcement actions was not applicable in the case at hand, as Director Kraninger had merely ratified "the issuance and enforcement of the CID...determining whether [Seila] ha[d] engaged in violations that could justify bringing an enforcement action."

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