Key Takeaway: For now, pre-dispute arbitration clauses with class action waivers are safe.
On November 1, President Trump abrogated a Consumer Financial Protection Bureau (CFPB) rule that would have given consumers the ability to institute class action litigation against financial firms, including banks. Specifically, Trump executed a resolution passed by the House and Senate under the Congressional Review Act that nullifying the CFPB rule.
As we reported in a prior post [Update: Following Razor-Thin Senate Vote, The Consumer Financial Protection Bureau Fails in Effort to Outlaw Class Action-Killing Arbitration Clauses in Consumer Financial Services Contracts], the Senate had recently passed its version a resolution disapproving of this rule by the razor thin margin of 51-50, with Vice President Mike Pence casting the tie-breaking vote.
Under the Congressional Review Act, the Rule is abrogated and the CFPB cannot reissue the Rule in “substantially the same form.” 5 U.S.C. § 801(a)(3), (b).