## Facts

- Congress enacted the Dodd–Frank Wall Street Reform and Consumer Protection Act after the 2008 financial crisis.
- The Act created the Consumer Financial Protection Bureau (CFPB), led by a single director removable only for cause and funded outside the ordinary appropriations process.
- The Act also created the Financial Stability Oversight Council (FSOC), which may designate firms as systemically important financial institutions (SIFIs), triggering heightened supervision.
- The Act further established the Orderly Liquidation Authority (OLA), allowing regulators to place failing firms into receivership and depart from ordinary bankruptcy outcomes.
- A small national bank, along with nonprofit organizations and individuals, brought constitutional challenges to (1) the CFPB’s structure and powers and (2) the recess appointment of CFPB Director Richard Cordray.
- The bank also challenged FSOC’s SIFI-designation authority.
- Eleven states challenged OLA, alleging harm as current or potential creditors/investors in large financial institutions subject to possible OLA resolution.
- The district court dismissed all claims for lack of Article III standing and lack of ripeness.
- The court of appeals reviewed whether each plaintiff group had standing and whether the claims were ripe, without reaching the merits of the constitutional theories.

## Issues

1. Whether the bank had Article III standing and a ripe claim to challenge the CFPB’s structure.
2. Whether the bank had Article III standing and a ripe claim to challenge the constitutionality of Director Cordray’s recess appointment.
3. Whether the bank had Article III standing to challenge FSOC’s SIFI-designation authority.
4. Whether the state plaintiffs had Article III standing and a ripe claim to challenge OLA.

## Decision

- Reversed and remanded as to the bank’s CFPB structural challenge, holding the bank had standing and the claim was ripe.
- Reversed and remanded as to the bank’s challenge to Director Cordray’s recess appointment, holding the bank had standing and the claim was ripe.
- Affirmed dismissal of the bank’s FSOC challenge for lack of standing.
- Affirmed dismissal of the states’ OLA challenge for lack of standing and lack of ripeness.

## Legal Principles

- A regulated entity generally has standing to bring a pre-enforcement constitutional challenge to the legality or structure of the agency that regulates it when it is subject to that agency’s ongoing regulatory authority.
- Ripeness is more readily satisfied where the plaintiff challenges the existence or structure of the regulator itself, rather than a contingent future enforcement action tied to a specific rule or order.
- A plaintiff lacks Article III standing when the asserted injury depends on speculative contingencies and the plaintiff is not directly burdened by the challenged authority (e.g., no designation, no present regulatory impact).
- Creditor or investor theories of standing may fail where the alleged present injury (such as discounted asset value) rests on a chain of uncertain events involving future firm failure, discretionary government action, and uncertain distributional outcomes.

## Conclusion

The D.C. Circuit permitted the bank to proceed with pre-enforcement challenges to the CFPB’s structure and the CFPB director’s appointment because the bank was already regulated by the Bureau, but it rejected the bank’s FSOC challenge and the states’ OLA challenge as speculative and not fit for judicial resolution at that time.


State Nat'l Bank of Big Spring v. Lew, 795 F.3d 48 (D.C. Cir. 2015)