CFPB Governing Statute Allows for Parallel Enforcement by State Attorneys General

On July 27, 2020, the Third Circuit ruled that the governing statute for the Consumer Financial Protection Bureau (“CFPB”) permits parallel enforcement actions by state attorneys general. The three-judge panel also upheld Pennsylvania’s claims against Navient Corp. that are similar to claims being pursued by the CFPB.

Pennsylvania Attorney General Josh Shapiro brought a consumer protection case against Navient claiming that the student loan company mistreated its borrowers.  Navient argued that the claims were a “copycat” from the CFPB case and should be dismissed.  According to the opinion written by U.S. Circuit Judge Thomas L. Ambro, “we hold that the clear statutory language of the Consumer Protection Act permits concurrent state claims, for nothing in the statutory framework suggests otherwise.”  The Court’s opinion found that because, “the Commonwealth’s claims under the PA Protection Law based on affirmative misrepresentations and misconduct are not preempted, we affirm the District Court’s denial of Navient’s motion to dismiss.”  

A copy of the Third Circuit’s opinion can be found here.