After weeks of speculation, the U.S. Senate voted on Tuesday night to join the House of Representatives in passing a Congressional Review Act (“CRA”) resolution to nullify the Consumer Financial Protection Bureau’s (“CFPB”) recent arbitration agreements rule. The Senate vote split 50-50, with two Republican senators—Senators Lindsey Graham (SC) and John Kennedy (LA)—voting against the resolution. The split vote set the stage for Vice President Mike Pence to cast the tie-breaking vote in favor of the resolution, which is now headed to President Trump’s desk for signature. In the hours after the vote, the President released a statement indicating his support for the resolution.
More than two months after its promulgation, the fate of the Consumer Financial Protection Bureau (CFPB) arbitration agreements rule remains uncertain. The Senate may ultimately join the House and invoke the Congressional Review Act (CRA) to nullify the CFPB rule. But several financial services trade groups are not waiting to find out and have commenced their own legal challenge to the rule. On Friday, September 29, 2017, over a dozen such groups—led by the Chamber of Commerce of the United States of America—filed suit against the CFPB, and its director Richard Cordray, in U.S. District Court for the Northern District of Texas. See Complaint for Declaratory and Injunctive Relief, Chamber of Commerce of the United States of America, et al. v. Consumer Financial Protection Bureau, et al., No. 3:17-cv-02670-D (N.D. Tex. Sept. 29, 2017).
Recently, the Consumer Financial Protection Bureau (CFPB) promulgated its final arbitration agreement rule. The rule comes more than 11,000 comments, 13 months, and one change in presidential administration after the CFPB issued its proposed rule in May 2016. (K&L Gates previously reported on the issuance of the proposed rule here.) Yet despite its long history, Congress began taking steps to repeal the rule almost immediately.