We know that life shouldn’t be this hard. Consumers and their advocates fight for effective policies that address the many challenges they face in their daily lives. Unfortunately, our efforts to create fair legislative and regulatory consumer policies now must also overcome multiple hurdles created by our nation’s courts. This added and unnecessary burden can best be seen in the Consumer Financial Protection Bureau’s (CFPB’s) attempt to implement their recent Credit Card Late Fee rule.
In March 2024, after completing a lengthy notice and comment process, the CFPB issued a rule that would lower the cap on credit card late fees from up to $41 to $8 — a move that would save consumers approximately $10 billion a year. While the rule was supposed to go into effect two months later, it was quickly challenged by the financial service industry in their favorite court, where the rule’s implementation was stopped and where it now faces an uncertain future.
These days, we are plagued with far too many courts that do not properly apply the rule of law; but instead find unfounded ways to both rule in favor of corporations and erode longstanding consumers’ rights. This clear and growing problem is compounded by a judicial system that both allows for “judge shopping” and lacks necessary professional diversity. The judicial system’s corporate favoritism (and anti-consumer bias) is clear when you look at the data — the Roberts Court has sided with the Chamber of Commerce (which represents industry interests) in 70% of cases. This is a significant jump from earlier Supreme Courts, including the Rehnquist Court which sided with the Chamber 56% of the time, and the Burger Court only 43% of the time.
Judge Shopping
Unsurprisingly, banks opposed the rule because it threatened to cut into their enormous profits from unfair fees, and quickly filed a court challenge. Rather than filing the case in the D.C. District (where the rule was created, and most of the plaintiffs and defendants reside) they deliberately chose to file in a District where they knew it would be heard by a ‘sympathetic’ judge. This “judge shopping,” lead them to Fort Worth, Texas, where U.S. District Judge Mark Pittman, who has a record of ruling in favor of corporations and against federal agencies, was assigned the case. Previously, Judge Pittman had struck down the Biden administration’s attempt to forgive student loans and issued an order that prohibited the Minority Business Development Agency from considering a business applicant’s race or ethnicity when deciding program eligibility. This judge shopping exemplifies how corporations manipulate the legal system to secure outcomes in their favor and undermine fairness and justice.
Lack of Professional Diversity of Judges
Like most federal judges, Judge Pittman worked in commercial litigation and then as a prosecutor before joining the bench. Our federal judiciary is dominated by former prosecutors and corporate lawyers, and far too few judges have backgrounds in economic justice, such as labor law or consumer protection. As of 2022, only 11 out of 171 (or 6.4%) of appellate judges had a background in economic justice. The lack of professional diversity on the federal bench helps explain why courts so often rule against consumers and workers. Judges who have spent their careers representing powerful interests often lack the necessary perspective to understand the struggles of ordinary Americans. By diversifying our judiciary to include professionals who have worked on behalf of consumers, workers, and unions, our courts will be better equipped to ensure that justice is equally available to everyone, and not just favor the wealthy and well-connected.
A Hostile Supreme Court and Uncertain Future of Regulatory Protections
Because of the Supreme Court’s corporate bias, any CFPB proposed regulation, including the Credit Card Late Fee rule, must now survive much greater judicial scrutiny. In June, the Supreme Court’s 6–3 ruling in Loper Bright Enterprises v. Raimondo overturned a long-recognized doctrine known as Chevron deference that required courts to defer to the agency’s legislative interpretation when statutory language is ambiguous. With Chevron overturned, unelected federal judges, and not subject matter experts at federal agencies, become the arbiters of statutory interpretation. Although it is unclear how this might affect the Credit Card Late Fees rule, rules that the CFPB (or any other agency) issues will be much more vulnerable to challenges in hostile courts. Since judges now have much greater leeway in how they interpret legislation and administrative rulemakings, it’s even more important that we have judges who apply the law fairly, and who understand how these rules impact ordinary people’s lives.
What Can We Do?
The Credit Card Rule — a simple regulation that would have provided concrete relief to millions of Americans has now turned into a drawn-out struggle that may never see the light of day. Our legal system, a place where ordinary citizens should be able to find some measure of justice, has been systematically distorted to serve moneyed interests. Today, judge shopping, a lack of judicial diversity, and the erosion of crucial legal doctrines serve to obstruct our efforts to hold corporations accountable.
But it does not need to be this way. If we truly care about consumer rights and economic justice, it is critical that we fight just as fiercely for fair courts as we do for fair policies. We must champion the nomination of judges with a proven record of advocating for consumers and employees, work with and support organizations engaged in the fight for consumer justice, and speak out on the urgent need for court reform. Only then will we be able to create just, necessary and long-lasting policies that protect all American consumers.
