Ocwen to Resume Constitutional Attack on CFPB

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By Chris Bruce

Ocwen Financial Corp. will within days again take up a challenge to the Consumer Financial Protection Bureau’s constitutionality, a spokesman for Ocwen confirmed June 9 ( Cons. Fin. Protection Bureau v. Ocwen Fin. Corp. , S.D. Fla., 17-cv-80495, complaint filed 4/20/17 ).

Ocwen sought to raise that question early on in a case brought by the CFPB in April that claimed the Atlanta-based company violated consumer protection laws in servicing loans of distressed borrowers.

Judge Kenneth Marra of the U.S. District Court for the Southern District of Florida blocked that effort June 2, but only in terms of timing. Marra, while denying Ocwen’s motion for a special case conference to address the question, said Ocwen is free to test the CFPB’s constitutionality later on in a motion to dismiss the CFPB’s lawsuit.

John Lovallo, a spokesman for Ocwen, said to expect that challenge and others within days. “Ocwen’s motion to dismiss is currently due June 19, and constitutionality will be one of many arguments,” Lovallo said in an email to Bloomberg BNA.

The CFPB’s constitutionality is an ongoing question in several cases, especially in the U.S. Court of Appeals for the District of Columbia Circuit, where the court’s full bench May 24 heard argument in a case involving PHH Corp. of Mount Laurel, N.J. The Ninth Circuit also recently allowed an appeal on whether the CFPB is constitutional.

Ocwen is represented by Thomas M. Hefferon and Sabrina M. Rose-Smith of Goodwin Procter in Washington, and Bridget Ann Berry of Greenberg Traurig in West Palm Beach, Fla. The CFPB is represented by Jean Marie Healey, Atur Ravi Desai, and Jan Edwards Singelmann.

To contact the reporter on this story: Chris Bruce in Washington at cbruce@bna.com

To contact the editor responsible for this story: Michael Ferullo at MFerullo@bna.com

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