UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA _________________________________________ ) NATIONAL ASSOCIATION FOR ) LATINO COMMUNITY ASSET BUILDERS, ) ) Plaintiff, ) ) v. ) ) CONSUMER FINANCIAL ) PROTECTION BUREAU, ) Case No. 20-cv-3122 (APM) ) Defendant, ) ) and ) ) COMMUNITY FINANCIAL SERVICES ) ASSOCIATION OF AMERICA, ) ) Intervenor-Defendant. ) _________________________________________ ) MEMORANDUM OPINION I. In 2017, Defendant Consumer Financial Protection Bureau (“CFPB”) enacted a rule designed to protect consumers from certain practices in the markets for payday and vehicle-title loans (the “2017 Rule”). These types of financial instruments typically involve high interest rates and short maturity periods that are collateralized by the borrower’s next paycheck or car title. In the 2017 Rule, CFPB explained that many consumers are unable to repay such loans and so “face one of three options when an unaffordable loan payment is due: Take out additional covered loans . . . , default on the covered loan, or make the payment on the covered loan and fail to meet basic living expenses or other major financial obligations.” 82 Fed. Reg. 54,472, 54,472 (Nov. 17, 2017) (to be codified at 12 C.F.R. pt. 1041). Many people take the first option: taking out a new loan to repay or reduce the old one. As a result, “a substantial population of consumers ends up in extended loan sequences of unaffordable loans.” Id. Among other key provisions, the 2017 Rule would prohibit the practice of no-underwriting lending, in which lenders offer loans without first assessing whether prospective borrowers can repay them. But in 2020, before the rule became effective and after CFPB had transitioned to new leadership, CFPB revoked key provisions of the 2017 Rule (the “2020 Repeal Rule”), preventing some of its core elements from going into place— including, notably, the prohibition on no-underwriting lending. Plaintiff National Association for Latino Community Asset Builders (“NALCAB”) filed this action challenging the 2020 Repeal Rule’s revocation of the planned prohibition on no- underwriting lending. NALCAB is a “nonprofit[] membership association of mission-driven community and economic development organizations that serve diverse Latino communities” across the country. First Am. Compl. for Declaratory & Injunctive Relief, ECF No. 26 [hereinafter First Am. Compl.], ¶ 6. It “works to strengthen the economy by advancing economic mobility in Latino communities.” Id. NALCAB brought this action because, it says, the 2020 Repeal Rule “makes NALCAB’s work more difficult”: “[a]s a result of the no-underwriting lending permitted by the Repeal Rule and the harms that such lending causes, organizations creating and strengthening financial capability programs need more assistance from NALCAB[] to be able to help families avoid or address unaffordable payday and title loans.” Id. ¶ 7. Now before the court are two motions to dismiss: one filed by the CFPB and the other filed by Intervenor-Defendant Consumer Financial Services Association of America (“CFSA”). 1 Def. CFPB’s Mot. to Dismiss Pl.’s Am. Compl. for Lack of Subject-Matter Jurisdiction, ECF No. 32 [hereinafter CFPB’s Mot.]; Intervenor-Def. CFSA’s Mot. to Dismiss, ECF No. 33 [hereinafter …
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