Three Reasons Why The Gorsuch Nomination Matters To You

March 20, 2017 at 9:43 am Leave a comment

Today the Senate Judiciary Committee kicks off the nomination hearing for Neil Gorsuch to fill the vacancy left open on the Supreme Court when Justice Scalia passed away. Assuming he ultimately gets approved by the Senate, there are few individuals who will have as direct and immediate impact on what your credit union can and can’t do for decades to come. This is not simply because he will be the fifth (presumably more conservative) vote on the court, or because he is the first of what could be multiple Trump nominees pushing the court further to the right, but because there is a plethora of outstanding legal issues that need to be resolved in the next few years.

Here are some of the big ones:

The structure of the CFPB- As readers of this blog will know the US Court of Appeals for the DC Circuit is set to reconsider En banc, whether the CFPB as structured is constitutional. Early this year, a panel of the same court ruled that it was unconstitutional for the CFPB to be overseen by a single director, who doesn’t serve at the pleasure of the president. Late last week, the Trump Administration submitted a brief arguing that this decision should be upheld. If the court’s earlier decision is upheld, the Trump Administration will have all the authority it needs to effectively fire Director Richard Cordray. However, win or lose this case will undoubtedly be heard by the Supreme Court with Gorsuch, who is no fan of regulatory overreach on the bench.

Judicial Deference- For my money, the single most important doctrinal issue up for debate is the extent to which courts should defer to an agency’s interpretation of a statute it is charged with implementing. Expect to hear a fair amount in the hearing today about the so-called Chevron Doctrine. In recent years, members of the court’s more conservative wing have openly questioned this judicial doctrine, under which agencies are given wide latitude to interpret regulations susceptible of more than one meaning. Critics of this approach, including yours truly, argue that it has opened the door for agencies to be defecto lawmaking bodies, unconstrained by the laws they are punitively interpreting. You have been impacted by this deference if you feel that mortgage originators should properly be classified as exempt employees or if you have had to rewrite your social media policy to ensure that you don’t discriminate against employees wishing to discuss an issue of workplace concern.

Fair Lending Laws and Disparate Impact– One issue that I personally expect to keep bubbling under the legal service is the proper interpretation of Fair Lending Laws. For example, no one disputes that the Fair Housing Act outlaws intentional discrimination. In a decision in June of 2015 the court held five to four that it also outlaws practices that have a disparate impact on minorities. On one hand this decision did nothing more than uphold the traditional interpretation of the FHA. Even with this decision however, analysis of what constitutes a disparate impact is so fact sensitive that you can expect litigation involving this issue for years to come.

Entry filed under: General.

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Authored By:

Henry Meier, Esq., General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association.

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