John Doe Co. v. Consumer Financial Protection Bureau, 2017 U.S. App. LEXIS 3894

Background

John Doe Co., a California LLC operating from the Philippines, buys and sells income streams and has faced negative publicity and at least six state consumer-protection actions.
In Nov. 2016 the Consumer Financial Protection Bureau (CFPB) issued a Civil Investigative Demand (CID) to the Company; CIDs are investigatory and non-self-executing (enforcement requires a court order).
The Company filed a pre-enforcement suit challenging the CFPB Director’s single-Director structure as unconstitutional and sought a preliminary injunction (including anonymity and to block the CID).
The district court denied a preliminary injunction, finding no likelihood of success on the merits and no irreparable harm; the Company sought an injunction pending appeal.
The court (per curiam) denied the injunction pending appeal, holding the Company failed to show likely success, irreparable harm, or that extraordinary relief was warranted; Judge Kavanaugh dissented, arguing the Company showed likely success and irreparable harm.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Company likely to succeed on separation-of-powers challenge to CFPB single-Director structure	CFPB structure violates Article II; PHH panel supports invalidation	PHH majority vacated; PHH differs factually (post-enforcement) and statutory remedies/severance available	Denied — Company failed to show likelihood of success; PHH vacated and factual posture differs
Whether pre-enforcement challenge to a non-self-executing CID is proper forum	Company may bring standalone pre-enforcement constitutional challenge (Free Enterprise)	Challenge should be raised in an enforcement proceeding; no meaningful-review bar here	Denied — Company failed to show it cannot obtain meaningful review in enforcement context
Whether issuance of a CID (investigation) alone causes irreparable harm	Any regulation/enforcement by an unconstitutionally structured agency inflicts irreparable constitutional injury	No immediate/ongoing harm from a CID; economic/reputational harms speculative; litigation expense is not irreparable	Denied — no concrete, certain irreparable harm shown; separation-of-powers violation alone not per se irreparable here
Appropriate remedy for a structural Article II violation (stay vs. severance)	Must enjoin CFPB operations until structure fixed	Severance of for-cause removal is standard; past acts need not be vacated and agency can continue functioning	Denied — severance/remedies other than halting investigations are traditional; injunction not warranted pending appeal

Key Cases Cited

Winter v. Natural Res. Def. Council, 555 U.S. 7 (U.S. 2008) (standards for preliminary injunction)
Free Enterprise Fund v. Public Co. Accounting Oversight Bd., 561 U.S. 477 (U.S. 2010) (allowed pre-enforcement structural challenge where review otherwise foreclosed)
Buckley v. Valeo, 424 U.S. 1 (U.S. 1976) (distinguished investigative measures from unconstitutional appointments/removals)
PHH Corp. v. Consumer Fin. Prot. Bureau, 839 F.3d 1 (D.C. Cir. 2016) (panel decision finding CFPB structure problematic; later vacated pending en banc)
Morgan Drexen, Inc. v. Consumer Fin. Prot. Bureau, 785 F.3d 684 (D.C. Cir. 2015) (standing/administrative-review contexts for CFPB challenges)
In re al-Nashiri, 791 F.3d 71 (D.C. Cir. 2015) (separation-of-powers violation not necessarily irreparable absent immediate harm)
Thunder Basin Coal Co. v. Reich, 510 U.S. 200 (U.S. 1994) (administrative-exhaustion and reviewability principles)
United States v. Salerno, 481 U.S. 739 (U.S. 1987) (facial-challenge standard)
FTC v. Standard Oil Co. of Cal., 449 U.S. 232 (U.S. 1980) (litigation expense not irreparable harm)
Citizens for Abatement of Aircraft Noise, Inc. v. Metropolitan Wash. Airports Auth., 917 F.2d 48 (D.C. Cir. 1990) (past acts of an unconstitutionally structured body need not be automatically invalidated)