Chamber Says CFPB Wants All Regulatory Challenges Moved to D.C.

The Chamber of Commerce and other trade groups challenging the Consumer Financial Protection Bureau’s credit card late fee cap are accusing the agency of trying to funnel all regulatory challenges to the federal district court in Washington.

The trade groups said that the Fort Worth Chamber of Commerce includes branches of at least six national banks that are affected by the CFPB’s $8 credit card late fee limit as members and therefore has standing to sue the CFPB over the rule in a Monday filing in the US District Court for the Northern District of Texas.

The CFPB argued in a July 29 motion that no credit card issuers with 1 million open accounts—the minimum number of open accounts necessary to be subject to the rule—are based in Fort Worth, Texas, or are members of the local chamber of commerce there. Because of that, the case should be moved the federal district court in Washington, D.C.

But the Chamber of Commerce argued that standing rules don’t require a company to be based in the judicial district in which a rule challenge is filed, merely that it has operations there that would be harmed by a regulation.

Instead, the Chamber said the CFPB is trying to make sure that only judges in Washington hear rules challenges.

“Injecting such considerations into the germaneness inquiry would hamper local organizations’ abilities to challenge national policies that have real effects in their communities and allow the federal government to push litigation out of proper venues and into the District of Columbia,” the Chamber said.

Judge Mark Pittman has twice transferred the challenge to the CFPB’s credit card late fee rule to Washington, noting that three national trade group plaintiffs—the Chamber, the American Bankers Association, and the Consumer Bankers Association—and the CFPB are based there.

The US Court of Appeals for the Fifth Circuit brought the case back to the federal district court in Fort Worth both times.

The Chamber and other industry groups have used federal district courts in Texas to challenge a host of Biden administration regulations and guidance documents to great success in recent years. Critics of the practice have accused the industry groups of choosing courts where they know they’ll get a friendly hearing from judges appointed by former President Donald Trump and other Republican presidents.

The CFPB unveiled its credit card late fee cap in March as part of the Biden administration’s push against “junk fees.”

The trade groups sued to block the rule two days later.

Paul Hastings LLP represents the trade group plaintiffs.

The case is Chamber of Commerce v. CFPB, N.D. Tex., No. 4:24-cv-00213, Opposition to Motion to Dismiss 8/12/24.