Cordray’s Appointment Questioned Following Appeals Court Ruling

A federal appeals court in Washington, D.C., ruled Friday that the controversial recess appointments made by President Obama in January 2012--which includes the appointment of Richard Cordray as director of the ""Consumer Financial Protection Bureau"":http://www.consumerfinance.gov/ (CFPB)--are ""invalid from their inception.""

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In ""_Noel Canning v. National Labor Relations Board_"":http://www.cadc.uscourts.gov/internet/opinions.nsf/D13E4C2A7B33B57A85257AFE00556B29/$file/12-1115-1417096.pdf, the court examines the recess appointments of three members of the board--Sharon Block, Terence Flynn, and Richard Griffin, all of whom were appointed January 4, during a three-day Senate break. While he is not specifically named in the court's opinion, Cordray was also appointed to his CFPB post that day.

Administration officials insisted the president was acting correctly under the recess appointments clause of the Constitution; critics argued that the Senate was not actually in recess at the time and that the president was skirting around the confirmation process.

In its opinion, the court agreed that a short break does not constitute a ""recess,"" noting ""the appointments structure would have been turned upside down if the President could make appointments any time the Senate so much as broke for lunch.""

""The natural interpretation of the [recess appointments] Clause is that the Constitution is noting a difference between 'the Recess' and the 'Session,' the court writes. ""Either the Senate is in session, or it is in recess. If it has broken for three days within an ongoing session, it is not in 'the Recess.'""

While the court's opinion doesn't address Cordray or the validity of his tenure at CFPB, the ruling should serve as ammunition for those opposed to the president's recent ""re-nomination"":http://dsnews.comarticles/obama-nominates-former-us-attorney-as-sec-chair-re-nominates-cordray-2013-01-24 of Cordray as the agency's director.

The ruling comes at an awkward time for CFPB, which has issued in the last few weeks a ""number of new rules"":http://dsnews.comarticles/cfpb-releaes-long-awaited-qualified-mortgage-rule-2013-01-10 to govern mortgage ""origination"":http://www.themreport.com/articles/cfpb-announces-rules-to-reform-originator-compensation-2013-01-18 and ""servicing"":http://dsnews.comarticles/cfpb-establishes-new-servicing-rules-to-prevent-foreclosure-2013-01-17. The potential impact the ruling may have on the agency's activities in the last in unclear at this point, though a spokesperson for CFPB said in an email to ""Bloomberg"":http://www.businessweek.com/news/2013-01-25/u-dot-s-dot-court-ruling-threatens-consumer-bureau-decisions#p2 that ""the court's ruling has no effect on the bureau.""