Seila Law v. Consumer Fin. Protection Bureau
Facts
The CFPB is headed by a single Director serving a five-year term and removable by the President only for inefficiency, neglect of duty, or malfeasance in office. The Director exercises significant executive authority, including issuing binding rules under 19 federal statutes, conducting administrative adjudications, and bringing enforcement actions seeking substantial penalties against private parties. The agency also receives funding outside the annual appropriations process. A CFPB Director issued a civil investigative demand to Seila Law, and the Government petitioned to enforce it.
Issue
Whether the separation of powers permits Congress to create an independent agency led by a single Director who is a principal officer wielding significant executive power and who is protected from removal by the President except for cause. If not, whether that removal restriction is severable from the rest of the Dodd-Frank Act provisions establishing the CFPB.
Rule
The President's removal power is the general rule under Article II. Although prior precedents recognized limited exceptions for certain multimember expert agencies and certain inferior officers with limited duties, those precedents do not extend to a principal officer who, acting alone, wields significant executive power; such an official must remain removable by the President. When a statute contains an unconstitutional removal restriction, that restriction must be severed if the remaining provisions can function independently and the statute indicates Congress would prefer the remainder to remain operative.
See the holding & full analysis
Create a free KwikCourt account to unlock the rest of this brief — and practice the case.
- The court's holding and reasoning
- Doctrine tests, pitfalls & exam hypotheticals
- 10 practice questions + 4 AI-graded essays on this case
Test yourself
If challenged on separation-of-powers grounds, how should a court most likely rule?