On November 20, 2012, the CFPB moved to dismiss (a copy of the memorandum in support of the motion to dismiss is here)  the recent constitutional challenge to the Bureau's authority in State National Bank of Big Spring, Texas v. Geithner,  a case pending in federal court in Washington, D.C.  As our readers will recall, we posted about this complaint in June 2012, and plaintiffs amended their complaint (a copy of the amended complaint is here) in September to add the State AG’s from Michigan, Oklahoma and South Carolina.

Defending the CFPB, the Department of Justice brief argues for the CFPB that plaintiffs lack standing: “Despite the roving allegations of unconstitutionality set forth in the Amended Complaint, not one of the statutorily authorized actions that Plaintiffs speculate might someday cause them harm has yet occurred.”   The CFPB likewise argues that State National Bank (SNB) suffered no injury from the designation of certain banks as “Systemically Important Financial Institutions” (SIFIs) that would therefore be subject to greater government regulation. Rather than claiming harm from itself being designated a SIFI, SNB “attempts to cast a SIFI designation and the heightened federal regulation that accompanies it as a benefit, and then claims that it will suffer a competitive injury because it has not been designated.”  According to the CFPB, this argument is based on mere “speculation that one of its direct competitors will someday be designated a SIFI,” among other speculative assertions.  This, the CFPB argues, does not and cannot constitute sufficient harm.