The court’s decision may impact other pending CFPB enforcement actions where ratification occurred outside the statute-of-limitations period. Editor’s note: This article is published with permission Mayer Brown.
ANALYSIS: CFPB suffers first court loss after Seila Law
Image by New Africa / Shutterstock.com Thursday, Apr. 08, 2021, 11:05 AM By Ori Lev and James Williams
Mayer Brown NEW YORK -
One of the great ironies of the Supreme Court’s decision in Seila Law versus CFPB, in which the Supreme Court held that the Consumer Financial Protection Bureau’s (CFPB) structure was unconstitutional, is that it effectively provided no relief to Seila Law, the party that took the case all the way to the Supreme Court.
On remand, the Ninth Circuit held that the CFPB’s case against Seila Law could continue. Now, for the first time, a court has held that a pending CFPB enforcement action must be dismissed because of that constitutional infirmity.
CFPB Suffers First Loss After Seila Law - Finance and Banking mondaq.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from mondaq.com Daily Mail and Mail on Sunday newspapers.
Thursday, April 1, 2021
On March 26, 2021, Judge Maryellen Noreika of the U.S. District Court for the District of Delaware dismissed a lawsuit brought by the Consumer Financial Protection Bureau (“CFPB”) in
Consumer Financial Protection Bureau v. The National Collegiate Master Student Loan Trusts,
1 finding,
inter alia, that the CFPB’s suit was constitutionally defective due to the CFPB’s untimely attempt to ratify the prosecution of the litigation in the wake of the Supreme Court’s decision in
Seila Law LLC v. Consumer Financial Protection Bureau. This case has been closely watched by many participants in the structured finance industry, because the litigants had disputed over the question of whether the trusts at issue in the litigation are “covered persons” liable under the Consumer Financial Protection Act despite their status as passive securitization trust entities a question that has important and wide-reaching implications for the structu
Student loan companies return to court to collect on private education debt
Danielle Douglas-Gabriel, The Washington Post
Jan. 21, 2021
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While the federal government continues to pause the collection of defaulted student loans during the coronavirus pandemic, private companies that initially followed suit are back in court.
Private education lenders and creditors have resumed filing new lawsuits and continuing existing cases to recover past-due debts, according to court records. Many companies had vowed to halt collections litigation as Americans faced layoffs and wage reductions in the beginning of the health crisis.
But despite tens of thousands of people still losing their jobs, student loan companies are again seeking payment. Attorneys for some of the largest private education debt creditors have filed dozens of lawsuits in several states since at least the summer.