Conservative Minimalism and the Consumer Financial Protection Bureau

Jonathan H. Adler1Jonathan H. Adler is the Johan Verheij Memorial Professor of Law and the Director of the Coleman P. Burke Center for Environmental Law at Case Western Reserve University School of Law.

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A part of the Seila Law and the Roberts Court series.

Chief Justice John Roberts mystified and frustrated court watchers with his opinions in the closing weeks of the Supreme Court’s October 2019 term. He joined with the Court’s liberals to reject the Trump administration’s attempt to rescind the Obama administration’s Deferred Action for Childhood Arrivals (DACA) immigration policy and invalidate Louisiana’s regulation of abortion providers. In other cases, he voted with the Court’s conservatives to protect religious institutions and to uphold the Trump administration’s expansion of religious and conscience objections to the Affordable Care Act’s contraception mandate. Chief Justice Roberts refused to interpret the Sixth Amendment to require jury unanimity for criminal convictions in state courts, but voted to constrain the habeas rights of asylum seekers. Meanwhile on the shadow docket, he joined conservatives in refusing to allow district courts to modify state election rules in light of COVID-19 concerns, while joining liberals in refusing to enjoin state restrictions on religious assemblies.

While Chief Justice Roberts’s votes do not hew closely to what either conservatives or progressives would have preferred, it is a mistake to assume the chief justice has been arbitrary or inconsistent. Rather, the October 2019 Term offered further confirmation that Chief Justice Roberts is a conservative minimalist. While his jurisprudential orientation remains quite conservative, he prefers narrow rulings over sweeping judgments. “If it’s not necessary to decide more to dispose of a case, in my view it is necessary not to decide more,” he explained in his confirmation hearings. At the same time, Chief Justice Roberts is reluctant to overturn Supreme Court precedent or declare federal laws to be unconstitutional. In cases in which such decisions are unavoidable, he still prefers to minimize change or disruption, through narrow rulings, surgical excision of constitutional infirmities, and restrained remedies that avoid disrupting settled expectations. Whatever its merits, this is the jurisprudence the chief justice has embraced in his time on the Court.

Chief Justice Roberts’s adherence to conservative minimalism was on display in his opinion for the Court in Seila Law v. Consumer Financial Protection Bureau, invalidating a provision limiting the president’s authority to remove the director of the Consumer Financial Protection Bureau (CFPB) without cause. Chief Justice Roberts’s decision embraced a conservative conception of separation of powers, closely aligned with the “unitary executive” theory. Yet his application of this theory was quite restrained. While embracing principles that would seem to have broader application, the chief justice eschewed any questioning of prior precedent and provided the plaintiffs with minimal relief. Whatever the substantive merits of the chief’s Seila Law opinion, it was quite consistent with his overall jurisprudence since joining the Court.

I. The CFPB vs. the Unitary Executive

The CFPB was born out of the financial crisis, enacted as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. Its mandate was to combat “unfair, deceptive, or abusive” acts and practices in the area of consumer finance through investigations, regulations, adjudications, and enforcement actions. Some of this authority was new. Some was transferred from other, preexisting federal agencies.

As originally conceived, the CFPB was to be structured as a traditional independent agency. It would be headed by a multimember commission much like the Federal Trade Commission (FTC), Securities and Exchange Commission (SEC), or Federal Energy Regulatory Commission (FERC), and members of the commission would be insulated from undue political influence by limiting the president’s ability to remove commissioners only for “inefficiency, neglect of duty, or malfeasance in office.” Congress had relied upon this sort of multimember structure for decades, and the Supreme Court had blessed protecting members of such commissions from removal by the president in 1935 in Humphrey’s Executor v. United States. Yet in creating the CFPB, Congress ultimately decided to do something different.

Unlike the FTC, FERC, FCC, NLRB, SEC, and a host of other independent regulatory agencies, the CFPB has a single agency head, instead of a commission or board. The CFPB director is appointed by the president to a five-year term, subject to the Senate’s advice and consent. The CFPB is also provided with an independent source of funding, in amounts largely determined by the agency’s director, outside of the congressional appropriations process. In constructing the CFPB this way, Chief Justice Roberts stressed, “Congress deviated from the structure of nearly every other independent administrative agency” in the nation’s history—and certainly from the structure of those agency structures considered in the Court’s prior decisions.

In concluding that the CFPB’s structure was unconstitutional, the chief justice stressed the unitary nature of the executive. As explicated by Chief Justice Roberts, Article II requires “all” executive power to be vested in the president: “The entire ‘executive Power’ belongs to the President alone.” Subordinates may exercise authority when implementing policy decisions, administering federal programs, or otherwise executing the laws, but the power they exercise is ultimately subject to the president’s control. Further, it is the president who ultimately bears responsibility to “take Care that the Laws be faithfully executed.”

The removal power is a core element of executive power, in Chief Justice Roberts’s telling, which “follows from the text of Article II.” As he sees it, executive power “generally includes the ability to remove executive officials, for it is ‘only the authority that can remove’ such officials that they ‘must fear and, in the performance of [their] functions, obey.’” Obedience by executive branch officials is necessary because “lesser officers must remain accountable to the President, whose authority they wield.” “Without such power,” the chief explained in Free Enterprise Fund v. Public Company Accounting Oversight Board (and quoted in his Seila Law opinion), “the President could not be held fully accountable for discharging his own responsibilities; the buck would stop somewhere else.”

If one accepts these premises, the unconstitutionality of the CFPB—and, indeed, that of all independent agencies—would seem to follow. If the president must be able to remove officers within the executive branch so as to ensure that the law is faithfully executed in accordance with the president’s understanding of what the law requires—so that the president may be held accountable for how the law is executed—then it would seem to follow that any limitation on the removal of an agency head would be unconstitutional. The principle, as set forward in Chief Justice Roberts’s opinion, would seem to preclude the legislature from erecting any obstacle to presidential removal. If, as the chief justice avers, the power of removal is necessary to ensure that officers are accountable to the president, it would seem this would apply whether or not such officer heads a governmental office alone, or is part of a larger commission. Insulation from control through limitations on removal would seem to attenuate presidential control either way. Yet Chief Justice Roberts was unwilling to follow the principles embraced in his opinion to their logical conclusion. The CFPB may be unconstitutional, but the FTC and other independent agencies would be safe.

II. This Far and No Farther

The theory of executive power expounded by Chief Justice Roberts’s Seila Law opinion is incompatible with any limits on presidential removal of officers, but that is not what Seila Law ultimately held. As Chief Justice Roberts acknowledged, the Court had not always adhered strictly to the conception of Article II it now embraced. Twice before, in Humphrey’s Executor v. United States and Morrison v. Olson, the Court had allowed “exceptions” to the underlying principles.

Humphrey’s Executor upheld a for-cause requirement for the removal of members of multimember commissions. Morrison v. Olson upheld such a requirement for the independent counsel. In ruling against the CFPB, Chief Justice Roberts saw no need to question these “two exceptions to the President’s unrestricted removal power.” The narrow holdings of Humphrey’s Executor and Morrison could be upheld, even as the Court jettisoned their reasoning and refused to countenance additional deviations from the underlying rule. It was enough to defang the older precedents without overturning them.

As in Free Enterprise Fund, the Court “declined to extend” the previously recognized exceptions to the general removal power to a new, “unprecedented” arrangement. There, in another opinion by Chief Justice Roberts, the Court concluded that insulating an executive branch officer from presidential control with “two layers of for-cause removal protection” would extend the previously recognized exceptions into new terrain. This “novel impediment” to presidential control was too much for the Court’s conservative majority to accept.

There was only one layer of insulation protecting the independence of the CFPB, but the CFPB director, unlike the commissioners of board members of other independent agencies, had “no peers” that might constrain her actions. This, too, was a “novel” agency structure. The narrow exceptions allowed in Humphrey’s Executor and Morrison represented “the outermost constitutional limits of permissible congressional restrictions on the President’s removal power.” Presented with the opportunity “to extend those precedents to the ‘new situation’ [of] an independent agency led by a single director and vested with significant executive power,” Chief Justice Roberts declined. In this regard there is a “this far, and no farther” element to the chief’s opinion that is quite reminiscent of the Rehnquist Court’s approach to Congress’s enumerated powers.

In effect, the chief justice’s method is to accept that what is done is done. There is no need to revisit established precedents and upset settled expectations. Whatever reliance interests have built up around such prior decisions will be respected and observed. But such precedents will not be relied upon as justifications for further expansions or innovation. Previously recognized exceptions are, in effect, grandfathered and preserved, but future exceptions are not allowed. The Court is not blessing Congress’s prior deviations from the principle of presidential control, so much as excusing them—in effect, saying to Congress: “Go forth and sin no more.”

In the context of agency independence, this means that previously recognized decisions deviating from the chief’s conception of Article II will continue to be recognized as exceptions to the general principle. Congress may require cause for presidential removal of members of multi-member boards and commissions and for inferior officers with narrowly defined responsibilities, but nowhere else. In other words, Congress may continue to create new agencies modeled on the FTC, and may authorize the appointment of independent counsels or equivalent officials, but it may not create “novel” forms of agency independence. Granting equivalent independence to more powerful or autonomous officers would be an extension the chief is unwilling to allow. Novelty in agency design is constitutionally suspect.

This approach to precedent is a hallmark of Chief Justice Roberts’s jurisprudence. Although he has been willing to overturn precedents in limited circumstances, as he did in the October 2018 term in Knick v. Township of Scott, it is something he seeks to avoid, and has done so with some success as chief justice. The Supreme Court under Chief Justice Roberts has overturned prior precedents at a significantly lower rate than its post-War predecessors, and there is little question that Chief Justice Roberts is part of the reason. (Indeed, he has the scars, in the form of angry concurrences and dissents from less-patient colleagues, to prove it.)

Adhering to precedent, in the chief justice’s view, does not require reaffirming the underlying principles of prior precedents, let alone extending them. While promising the same result should the precise facts of Humphrey’s Executor recur, Chief Justice Roberts did not say Humphrey’s Executor was correct. To the contrary, the principles underlying Seila Law suggest such the opposite. In this regard, the structure of Seila Law has much in common with the chief justice’s opinion concurring in the judgment in June Medical Services v. Russo, where he reaffirmed the precise result of a prior decision (Whole Women’s Health v. Hellerstadt) while expressly rejecting its underlying rationale.

III. Non-Disruptive Remedy

Upon concluding that the CFPB, as structured by Congress, was unconstitutional, the next question was what to do about it. Again, the result was consistent with the chief justice’s minimalist preferences. The Court excised the CFPB’s constitutional infirmity—the director’s removal protection—leaving the remainder of the law intact and the CFPB’s operations undisturbed. Whether the petitioners were entitled to an order barring enforcement of the CFPB’s civil investigative demand was remanded to the lower courts.

The Court’s severability analysis was straightforward, at least under the Court’s applicable precedents. It is well-settled that courts may conclude a single statutory provision is “repugnant to the Constitution without rendering the whole act void,” and that courts should seek to address any alleged constitutional infirmity in the most limited way possible by “severing any problematic portions while leaving the remainder intact.”

In this case, as in Free Enterprise Fund, the only constitutional question in front of the Court was whether Congress had unconstitutionally attenuated the president’s ability to control an agency by constraining his or her power of removal. And as in Free Enterprise Fund, this was found to justify the limited remedy of eliminating the offending provision. As Chief Justice Roberts observed, “the only constitutional defect we have identified in the CFPB’s structure is the director’s insulation from removal. If the director were removable at will by the president, the constitutional violation would disappear.” Further, as eliminating the removal provision would not impair any of the CFPB’s functions (other than, perhaps, its desired independence), there was no reason to go any farther.

In adopting this traditional, and narrow, approach to severability, Chief Justice Roberts stressed that alternative remedies, such as removing regulatory and enforcement authority from the CFPB, would “trigger a major regulatory disruption” and cause “appreciable damage to Congress’s work.” There no reason to believe Congress would prefer such a result. Thus, the chief concluded, the Court should “use a scalpel rather than a bulldozer in curing the constitutional defect” in the CFPB.

Although the chief justice portrayed his approach to severability as the most minimalist course, two justices disagreed. In dissent, Justice Clarence Thomas charged that selectively choosing which statutory provisions to enforce and which to erase is, in fact, a more aggressive and activist approach to severability than simply denying enforcement of the agency order at issue. Such an approach is more restrained, Justice Thomas argued, because it does not require taking a blue pen to Congress’s work. Moreover, Justice Thomas averred, the alternative of simply refusing to give legal effect to an order from an unconstitutionally constructed agency is more consistent with the original conception of the judicial power, which extends no farther than “the negative power to disregard an unconstitutional enactment.”

Justice Thomas’s objections are not without some force. Modern severability doctrine does seem to countenance judicial revision of statutes with an eye toward what Congress might have wanted had Congress foresaw the constitutional deficiency in its own work. Yet the chief justice did not claim his approach was that embraced or anticipated by the framers, let alone that it was based upon the original public meaning of the “judicial Power.” Rather, the chief justice grounded his approach to severability in the rather consistent practice of the Court over decades, from turn-of-the-last-century precedents through to the Court’s analogous decision in Free Enterprise Fund. That excising the removal provision also served to align the CFPB more closely with his conception of the president’s Article II power and minimized any disruption of existing regulatory programs were no doubt additional features of his approach as applied in this case.

IV. Avoiding the Exits

The holding and remedy of Seila Law do not require too much explanation. In many respects, they were a replay of Free Enterprise Fund. There Chief Justice Roberts also declared a “novel” agency structure to be unconstitutional because it unduly limited the president’s ability to control the agency’s conduct through limits on removal, and there the Court remedied the unconstitutionality by erasing the for-cause requirement, while leaving everything else about the statute and agency’s structure in place. In this respect, Seila Law was something of a sequel.

What may require explanation, however, is the chief justice’s refusal to accept alternative minimalist arguments presented on the CFPB’s behalf. Because the Trump administration (and the Trump-appointed CFPB director herself) accepted that any limitation on removing the CFPB director was unconstitutional, the Court appointed former Solicitor General Paul Clement to argue in defense of Congress’s creation. As Court-appointed amicus, Clement defended the for-cause removal requirement on the merits, but also made several other arguments the Court could have used to avoid deciding the constitutional argument altogether—arguments of the sort that have appealed to Chief Justice Roberts in other cases.

One argument in particular seemed tailor-made to appeal to the chief justice: interpret the relevant statutory language so as to avoid the constitutional question. Insofar as there were “grave constitutional doubts” about limiting the president’s authority to remove the CFPB director, amicus argued, “the Court can and should construe the provision to resolve that doubt in favor of preserving it.” Specifically, the “inefficiency-neglect-or-malfeasance standard” could be interpreted broadly to provide the president with sufficient discretion to remove the CFPB director to eliminate any constitutional concern. Further, amicus argued, the Court could forestall any detailed inquiry in to the contours of the removal standard until such time as a president sought to remove a CFPB director, at which point a reviewing court could provide a deferential review of the president’s decision, further avoiding the need to draw a hard constitutional line.

Such constitutional avoidance arguments have often appealed to Chief Justice Roberts. As I have detailed elsewhere, the chief justice has often been willing to embrace strained interpretations of statutory provisions to avoid concluding that a statute is unconstitutional. Bond v. United States,NAMUDNO v. Holder, and the chief’s separate opinion in NFIB v. Sebelius are all good examples of this practice at work.

If the chief justice is often willing to engage in aggressive constitutional avoidance, what explains his unwillingness to do so here? The apparent parallel between Seila Law and Free Enterprise Fund may be part of the explanation. He repeatedly characterized the cases as presenting the same underlying question. So, too, may be the chief justice’s preference for a baseline of an unconstrained presidential removal power. A greater motivation may have been a desire to avoid the disruption to well-established regulatory programs and agency operations that embracing constitutional avoidance would have caused.

Chief Justice Roberts’s tendency to engage in constitutional avoidance appears to be driven by his desire to avoid unduly disruptive results. Invalidating a federal statute is no small thing, and striking down a federal law will often prove disruptive to federal programs and congressional designs. In this case, however, severing the limitation on presidential removal of the CFPB director promises a lesser intrusion on the operation of the administrative state than construing the removal language at issue to impose less of a constraint on removal. That is, adopting the alternative interpretation proposed by amicus would have avoided the constitutional problem at the expense of greater disruption.

The chief justice’s Seila Law decision, as written, was narrowly confined to the CFPB and perhaps the Federal Housing Finance Agency (FHFA), the constitutionality of which the Court is slated to consider next term in Collins v Mnuchin. At the outside, only a handful of agency heads, with removal limitations of recent vintage, are affected by the Seila Law holding. Reinterpreting the “inefficiency-neglect-or-malfeasance standard” to allow for presidential removal over policy differences, on the other hand, would have had far-reaching implications throughout the administrative state, potentially curtailing agency independence across the board. While such a conclusion might be compelled by the constitution’s structure, Chief Justice Roberts noted, it is clearly contrary to congressional intent, and would produce a profound reworking of agency operations. Humphrey’s Executor would be undone, even if not overruled Given the choice between eliminating the independence of a “novel” agency, or suddenly subjecting long-standing agencies to greater presidential control, the chief justice reasonably concluded that the former option represented a more minimalist approach.

V. Welcome to the Roberts Court

There are many critiques to be made of Chief Justice Roberts’s minimalist approach, both as deployed in Seila Law and more broadly. Justice Elena Kagan wrote a powerful dissent in defense of the CFPB’s constitutionality, and Justice Thomas made the case for extending the logic of the majority’s opinion to other independent agencies and the need to provide the petitioners more tangible relief from the actions of an unconstitutionally structured agency.

The aim of this Essay has been not to defend the chief justice, so much as to explain his jurisprudential approach and highlight how his opinion in Seila Law is of a piece with the conservative minimalist approach he has followed since joining the Court in 2005. If anything, the chief justice’s minimalist tendencies have become more pronounced the longer he has been on the Court, and his efforts to encourage minimalism have born some fruit. The Court not only overturns prior precedents at a lower rate than its predecessors, as noted above; it invalidates federal statutes at a lower rate too.

With Justice Anthony Kennedy’s retirement in 2018, Chief Justice Roberts’s jurisprudence has become more important. For most of the Roberts Court, Justice Kennedy was the median justice, and voted with the majority more often than any of his colleagues. Indeed, he was something of a “super median,” and controlled the outcome in the vast majority of the Court’s 5–4 decisions. It is for this reason that many used to refer to the “Kennedy Court.

Whatever the Court was, it is now truly the Roberts Court. The chief justice was in the majority for 98 percent of the Court’s decisions in the October 2019 term. He only dissented twice. The chief’s preferences as to outcome prevailed more than those of any other justice. And, as the most senior justice, he has the additional power to shape the Court’s jurisprudence by deciding who will author which decisions, and when to keep opinion writing duties for himself.

In his confirmation hearing, Chief Justice Roberts identified the foundation of his minimalist approach. “Judges are like umpires” he said, “[because they] don’t make the rules, they apply them.” At the time, many commentators dwelled on his suggestion that deciding cases was like calling balls and strikes, but this missed his larger point: “Nobody ever went to a ballgame to see the umpire.” Whatever its other faults, Chief Justice Roberts’s minimalism is his way of trying to make the umpires less important, keeping the focus on those who play the game. While this approach may frustrate those who seek greater consistency and coherence within the Court’s jurisprudence, and may also be a bit naïve about the judiciary’s role in American government today, it is an approach to which the chief justice is committed. And as the October 2019 Term suggests, it is an approach that will continue to have a significant influence on the outcomes of major cases that come before the Court.

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Jonathan H. Adler is the Johan Verheij Memorial Professor of Law and the Director of the Coleman P. Burke Center for Environmental Law at Case Western Reserve University School of Law.

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