Collins v. Mnuchin

Courts should give relief to those hurt by illegal agency actions

Amicus Briefs > Separation of Powers > Collins v. Mnuchin

After the mortgage crisis in the early 2000s, Congress created the Federal Housing Finance Agency (FHFA) to regulate federal home loans. The FHFA is headed by a single director, who serves for a period of five years and cannot be removed by the President except for cause. Exercising its vast powers, the FHFA adopted a regulation that prevented the mortgage companies Fannie Mae and Freddie Mac from retaining profits. Instead, all of the companies’ profits were transferred to the federal treasury.

Shareholders of the two companies sued the FHFA, claiming that the agency was unconstitutionally structured because the director was unaccountable to the President. Just last term, the Supreme Court held that a similar agency, the Consumer Financial Protection Bureau, was unconstitutional because its agency was insulated from presidential control.

The lower court correctly held that the FHFA is unconstitutionally structured. The court did not, however, do anything about the agency’s unconstitutional actions. The court simply stated that the director is now removable at will by the President and did nothing to address any of the illegal actions taken by the agency.

Unfortunately, as some PLF clients know, winning a lawsuit against an agency does not necessarily mean getting relief. Often, administrative agencies will argue that, even if they acted illegally, courts should allow them to continue enforcing the illegal regulations. This not only provides no help for those that bring the lawsuit, it disincentivizes regulated people from challenging agency rules. Lawsuits are costly and time-consuming, and when someone wins a lawsuit against an agency, they should expect to have their issues resolved.

Related Documents

PLF regularly participates as amicus curiae, or friend of the court, in cases brought by others. This supplements our direct representation cases by providing judges with unique, strategic, and helpful arguments to consider when crafting their opinions in related cases

PLF Amicus Brief

September 16, 2020 Download

What’s at stake?

  • At stake is the danger of continued expansion of the modern administrative state, which already wields vast power and touches almost every aspect of daily life.
  • Individuals and small businesses are threatened by an ever-growing apparatus that concentrates power and avoids political accountability.
  • When individuals and small businesses file lawsuits against unlawful agency regulations and win, courts should hold agencies accountable.

Brief Authors

Related Articles

Donate