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Consumer Financial Protection Bureau v. The Source For Public Data, LP

United States District Court, N.D. Texas, Dallas Division

June 30, 2017

CONSUMER FINANCIAL PROTECTION BUREAU, Petitioner,
v.
THE SOURCE FOR PUBLIC DATA, LP, Respondent.

          MEMORANDUM OPINION AND ORDER

          DAVID L. HORAN UNITED STATES MAGISTRATE JUDGE.

         The Source for Public Data, L.P. (“Public Data”) seeks a stay pending appeal from the Court's orders compelling enforcement of a civil investigative demand (“CID”) issued by the Consumer Financial Protection Bureau (the “Bureau”). See Dkt. No. 29 (the “Stay Application”). Senior United States District Judge A. Joe Fish referred this case to the undersigned United States magistrate judge for determination under 28 U.S.C. § 636(b). See Dkt. No. 5.

         Background

         The Court granted the Bureau's petition to enforce a CID issued by the Bureau to Public Data on June 6, 2017, see Dkt. No. 27, and, on June 7, 2017, the Court ordered that Public Data must comply with the CID by the later of June 28, 2017 or a later date that may be established by the Bureau, see Dkt. No. 27.

         Public Data filed both its Notice of Appeal and the Stay Application on June 26, 2017. See Dkt. Nos. 28 & 29.

         The Court held a telephone conference with counsel for the parties on the Stay Application on June 27, 2017. See Dkt. No. 31. As a result of that discussion, the Court ordered that “the Clerk of the Court is directed to remove the sealed and ex parte restrictions from The Source for Public Data. L.P.'s Ex Parte Application for Stay Pending Appeal [29] (so that this docket entry will now be publicly available); the Consumer Financial Protection Bureau must file a response to the Application for Stay Pending Appeal [29] ¶ 11:00 a.m. Central Time on June 30, 2017, and no reply will be permitted; and the deadline set by the Court's June 7, 2017 Electronic Order [Dkt. No. 27] is stayed pending the entry of an order of the Court resolving the Application for Stay Pending Appeal [29].” Dkt. No. 32.

         Legal Standards

         A stay or injunction pending appeal is extraordinary relief and should be entered only when four conditions are met: (1) the movant establishes a likelihood of success on the merits; (2) the movant would suffer irreparable injury if a stay is not granted; (3) a showing that the stay would not substantially harm the other party; and (4) a demonstration that the stay would serve the public interest. See In re First South Savings Assoc., 820 F.2d 700, 704 (5th Cir. 1987); United States v. Baylor Univ. Med. Ctr., 711 F.2d 38, 39 (5th Cir. 1983). Each part of the four-factor test must be considered, but these factors should not be applied “in a rigid or mechanical fashion.” Baylor Univ. Med. Ctr., 711 F.2d at 39. Moreover, the movant “need only present a substantial case on the merits when a serious legal question is involved and show that the balance of equities weighs heavily in favor of granting the stay.” Id.; accord Reading & Bates Petroleum Co. v. Musslewhite, 14 F.3d 271, 272 (5th Cir. 1994).

         Analysis

         Public Data asserts that “[e]ach of the criteria for evaluating a request for a stay pending appeal as enumerated by the U.S. Supreme Court and as applied by the Fifth Circuit Court of Appeal militate in favor of granting Public Data the requested stay”:

First, the balancing of the equities favors granting a stay as the case presents serious, novel and unique questions of law that are proper subjects of an appeal. Second, unless a stay is granted, Public Data will suffer irreparable harm, its appeal will be rendered moot, and it will be compelled to comply with an overly burdensome production demand for documents and information to which the [Bureau] is potentially not entitled. Third, a stay will not harm the [Bureau] because the [Bureau] has not received any complaints against Public Data, there is no pending enforcement action against Public Data, and there are no other matters that would be affected by a stay. Finally, the public has a strong interest in ensuring governmental compliance with jurisdictional limitations and boundaries on statutorily prescribed authority.

Dkt. No. 29 at 2-3 of 19.

         The Bureau responds that

         Public Data has not met its burden to establish that a stay is warranted. The Bureau issued a Civil Investigative Demand (CID) in January seeking information as part of an investigation to determine whether consumer reporting agencies, persons using consumer reports, or other persons may be violating federal consumer financial protection laws, including the FCRA. More than six months later, the Bureau has yet to receive any information in response to its CID. On June 7, 2017, the Court ordered Respondent to comply with the CID by June 28, 2017 after it considered the relevant factors and found that the Bureau's jurisdiction for issuing the CID was not “plainly lacking” because there are plausible grounds to believe that Respondent may have information related to a violation of the FCRA. Respondent neither ...


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