Consumer Financial Protection v. Chance Gordon

FOR PUBLICATION

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

CONSUMER FINANCIAL PROTECTION No. 13-56484
BUREAU,
Plaintiff-Appellee, D.C. No.
2:12-cv-06147-
v. RSWL-MRW

CHANCE EDWARD GORDON, DBA
Gordon and Associates, DBA OPINION
National Legal Source, DBA
Resource Law Center, DBA
Resource Law Group, DBA
Resource Legal Group, DBA The
C E G Law Firm, DBA The Law
Offices of C. Edward Gordon, DBA
The Law Offices of Chance E
Gordon,
Defendant-Appellant.

Appeal from the United States District Court
for the Central District of California
Percy Anderson, District Judge, Presiding

Argued and Submitted
October 20, 2015—Pasadena, California

Filed April 14, 2016
2 CONSUMER FIN. PROT. BUREAU V. GORDON

Before: Sandra S. Ikuta and John B. Owens, Circuit Judges,
and William K. Sessions,* District Judge.

Opinion by Judge Owens;
Dissent by Judge Ikuta

SUMMARY**

Standing / Appointments / Consumer Financial
Protection Bureau

The panel affirmed in part, and vacated in part, the district
court’s summary judgment in favor of the Consumer
Financial Protection Bureau in its civil enforcement action for
violations of the Consumer Financial Protection Act
(“CFPA”) and Regulation O against Chance Gordon.

On January 4, 2012, President Obama, relying on his
recess-appointment power, named Richard Cordray as the
Bureau’s initial Director; and he renominated Cordray as
Director on January 24, 2013, and the Senate confirmed him
on July 16, 2013. The Bureau filed this action against
Gordon in July 2012.

The panel held that Cordray’s improper recess
reappointment, pursuant to NLRB v. Noel Canning, 134 S. Ct.

*
The Honorable William K. Sessions III, District Judge for the U.S.
District Court for the District of Vermont, sitting by designation.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
 CONSUMER FIN. PROT. BUREAU V. GORDON 3

2550, 2556–57 (2014), did not divest this court of jurisdiction
because the Bureau, as an agency of the Executive Branch,
had an interest or power in having federal law enforced, and
there was Article III standing. The panel also held that the
initial invalid recess appointment of Cordray was not fatal to
the case, because the subsequent valid appointment, coupled
with Cordray’s Senate confirmation, cured any Article II
Appointments Clause deficiencies.

The panel held that Gordon failed to demonstrate that
there was any dispute of material fact as to his liability under
the CFPA or Regulation O, and therefore, the district court
properly granted summary judgment in favor of the Bureau.
The panel also held that because the district court
conscientiously tailored the injunction at issue, it did not
abuse its discretion in granting equitable judgment to the
Bureau. The panel further held, however, that because the
district court may have impermissibly entered a monetary
judgment against Gordon for a time period prior to the
enactment or effective date of the relative provisions of the
CFPA and Regulation O, the case was remanded for further
consideration of the monetary judgment.

Judge Ikuta dissented. She would hold that the Bureau
lacked executive power to bring the civil enforcement action
because Richard Cordray was not properly appointed at the
time the action was filed, and therefore there was no Article
III standing, and the district court was bound to dismiss the
action.
4 CONSUMER FIN. PROT. BUREAU V. GORDON

COUNSEL

Gary Kurtz, Law Office of Gary Kurtz, PLC, Woodland Hills,
California, for Defendant-Appellant.

Meredith Fuchs, General Counsel; To-Quyen Truong, Deputy
General Counsel; John R. Coleman, Assistant General
Counsel; Nandan M. Joshi and Kristin Bateman (argued),
Attorneys, Consumer Financial Protection Bureau,
Washington, D.C., for Plaintiff-Appellee.

Charles J. Cooper (argued), David H. Thompson, Howard C.
Nielson, Jr., and John D. Ohlendorf, Cooper & Kirk, PLLC,
Washington, D.C., for Amicus Curiae Judicial Education
Project.
 CONSUMER FIN. PROT. BUREAU V. GORDON 5

OPINION

OWENS, Circuit Judge:

Appellant Chance Gordon appeals from the district
court’s order of summary judgment in favor of the Consumer
Financial Protection Bureau (CFPB) on its enforcement
action for violations of the Consumer Financial Protection
Act and Regulation O. We affirm in part, and vacate and
remand in part, for reconsideration of the monetary judgment
in accordance with this opinion.

I. BACKGROUND

A. Gordon’s Loan Modification Program

Gordon, a licensed California attorney, was the sole
owner and officer of the Gordon Law Firm (collectively
Gordon), and provided home loan modification services. Due
to changes in the law that prohibited charging up-front for
these services, Gordon created the “Pre-Litigation Monetary
Claims Program” (Program). In the Program, Gordon, for a
flat fee, would prepare certain legal “products” advertised to
help purchasers in their disputes with the lenders that owned
their mortgages.

Gordon also created an attorney-client “pro bono” legal
agreement, where he promised to provide certain legal
services free of charge, including negotiating with the lenders
to modify mortgages. Clients could receive these “pro bono”
services only if they paid for the Program. Previously,
Gordon charged clients for these same legal services.
6 CONSUMER FIN. PROT. BUREAU V. GORDON

To attract clients, Gordon hired Abraham Pessar to
perform marketing and advertising services.1 Pessar sent
direct mail marketing pieces to financially distressed
homeowners. In early 2010, Pessar and his team began
sending out a mailer titled “Notice of HUD Rights,” which
bore a Washington, D.C. return address to which neither
Gordon nor Pessar had any personal or business connection.
The mailer stated that it was provided “[c]ourtesy of the
Qualification Intake Department,” and that the recipient could
have the right to participate in a repayment program that
could prevent future foreclosure proceedings.

In June 2011, Pessar and his team created a new mailer
labeled “Program: Making Homes Affordable,” which closely
resembled the federal government’s “Making Home
Affordable Program” (though the mailer disclaimed any
affiliation with the government). Pessar’s team also used
websites and telephone calls to solicit consumers. Pessar
claimed that Gordon reviewed and approved all marketing
materials, while Gordon disputed his involvement and control
over the mailers, websites, and telephone calls.

1
The enforcement action at issue here was filed against Chance Gordon,
the “Gordon Entities,” Abraham Pessar, and the “Pessar Entities.” The
entities included various businesses and corporations owned and operated
by Gordon and Pessar. For simplicity, we will refer herein to Gordon and
his entities collectively as “Gordon” and Pessar and his entities as
“Pessar.” Pessar and his entities are no longer defendants in the suit, as
they settled with the government in January 2013.
 CONSUMER FIN. PROT. BUREAU V. GORDON 7

B. The Appointment (and Eventual Confirmation) of
Richard Cordray as Director of the CFPB, and His
Ratification of Past Acts

On January 4, 2012, President Obama, relying on his
recess-appointment power, named Richard Cordray as the
CFPB’s initial Director. See U.S. Const. art. II, § 2, cl. 3.2
That same day, he appointed three individuals to the National
Labor Relations Board (NLRB) in similar fashion. See NLRB
v. Noel Canning, 134 S. Ct. 2550, 2556–57 (2014). In Noel
Canning, the Supreme Court held that the NLRB
appointments did not satisfy Article II’s Appointment Clause
requirements, as they did not occur when the Senate was out
of session. Id. at 2574–77.

President Obama renominated Cordray as Director on
January 24, 2013. See White House Office of the Press
Secretary, Remarks by the President at a Personnel
Announcement (Jan. 24, 2013), https://www.whitehouse.gov/
the-press-office/2013/01/24/remarks-president-personnel-
announcement. On July 16, 2013, the Senate confirmed
Cordray as Director. 159 Cong. Rec. D704 (daily ed. July 16,
2013). On August 30, 2013, the CFPB issued the following
Notice of Ratification, signed by Cordray:

The President appointed me as Director of the
Bureau of Consumer Financial Protection on
January 4, 2012, pursuant to his authority
under the Recess Appointments Clause, U.S.

2
The relevant clause provides: “The President shall have Power to fill
up all Vacancies that may happen during the Recess of the Senate, by
granting Commissions which shall expire at the End of their next
Session.”
8 CONSUMER FIN. PROT. BUREAU V. GORDON

Const. art. II, § 2, cl. 3. The President
subsequently appointed me as Director on
July 17, 2013, following confirmation by the
Senate, pursuant to the Appointments Clause,
U.S. Const. art. II, § 2, cl. 2. I believe that the
actions I took during the period I was serving
as a recess appointee were legally authorized
and entirely proper. To avoid any possible
uncertainty, however, I hereby affirm and
ratify any and all actions I took during that
period.

Notice of Ratification, 78 Fed. Reg. 53734-02 (Aug. 30,
2013). The parties agree that while Cordray’s initial January
2012 recess appointment was invalid, his July 2013
confirmation was valid. They disagree as to the significance
of these events and the August 2013 ratification.

C. The CFPB Litigation Against Gordon

In July 2012, the CFPB filed a civil enforcement action
against Gordon, alleging that he violated two sections of the
Consumer Financial Protection Act (CFPA) (12 U.S.C.
§§ 5531, 5536) through unfair and deceptive practices—
namely, suggesting that consumers would likely receive
mortgage relief and that his operation was affiliated with the
government. It also alleged that Gordon violated Regulation
O (12 C.F.R. §§ 1015.1–11) by (i) receiving up-front
payments for mortgage relief services before consumers
entered into loan modification agreements with their lenders,
(ii) failing to make the proper disclosures while
communicating with consumers, (iii) advising consumers not
to communicate with their lenders, and (iv) misrepresenting
material aspects of his services. As relief, the CFPB sought
 CONSUMER FIN. PROT. BUREAU V. GORDON 9

a permanent injunction to prevent future violations,
restitution, and disgorgement of compensation. The CFPB
also filed an ex parte application for a temporary restraining
order that would (a) prohibit Gordon from operating his
business, (b) appoint a receiver, and (c) freeze his assets. The
district court issued the TRO and later a preliminary
injunction.

After receiving cross-motions for summary judgment, the
district court in June 2013 ruled in the CFPB’s favor. It
concluded that Gordon violated the CFPA in numerous ways,
including by representing that the Program would benefit his
clients (it actually left them in a far worse position), and that
his business was somehow affiliated with the government (it
was not). It held that Gordon violated Regulation O for the
reasons that the CFPB alleged. It also ordered
$11,403,338.63 in disgorgement and restitution against
Gordon and the Gordon entities, jointly and severally. This
represents the amount that Gordon and Pessar collected from
consumers from January 2010 through July 2012.

The district court chose not to address the merits of
Gordon’s argument that the CFPB lacked authority to bring
the action because its director, Cordray, was
unconstitutionally appointed per Noel Canning. The district
court concluded that Gordon had waived it by failing to
articulate how Cordray’s invalid appointment would prevent
the CFPB from prosecuting civil enforcement actions.
Gordon then appealed, and amicus Judicial Education Project
(JEP) filed a brief that more extensively discussed the
possible Article II and III consequences of Cordray’s failed
recess appointment.
10 CONSUMER FIN. PROT. BUREAU V. GORDON

II. STANDARD OF REVIEW

This court reviews questions of constitutional law de
novo. Bojnoordi v. Holder, 757 F.3d 1075, 1077 (9th Cir.
2014). We review a district court’s grant of summary
judgment de novo and may affirm on any ground supported
by the record. Dietrich v. John Ascuaga’s Nugget, 548 F.3d
892, 896 (9th Cir. 2008). A district court’s determination that
a party waived an issue is reviewed for an abuse of discretion.
L.A. News Serv. v. Reuters Television Int’l, Ltd., 149 F.3d
987, 996 (9th Cir. 1998). We review for an abuse of
discretion a district court’s grant of equitable monetary and
injunctive relief. FTC v. Grant Connect, LLC, 763 F.3d
1094, 1101 (9th Cir. 2014).

III. ANALYSIS

A. Article III Standing

We begin by addressing whether we have jurisdiction to
hear this case. Although Gordon did not argue Article III
standing to the district court, we have the obligation to ensure
that it exists. See WildEarth Guardians v. EPA, 759 F.3d
1064, 1070 (9th Cir. 2014) (citing Summers v. Earth Island
Inst., 555 U.S. 488, 499 (2009)).

“[T]he Constitution’s central mechanism of separation of
powers depends largely upon common understanding of what
activities are appropriate to legislatures, to executives, and to
courts.” Lujan v. Defs. of Wildlife, 504 U.S. 555, 559–60
(1992). “No principle is more fundamental to the judiciary’s
proper role in our system of government than the
constitutional limitation of federal-court jurisdiction to actual
cases or controversies.” Raines v. Byrd, 521 U.S. 811, 818
 CONSUMER FIN. PROT. BUREAU V. GORDON 11

(1997) (quoting Simon v. E. Ky. Welfare Rights Org.,
426 U.S. 26, 37 (1976)). Consistent with this checks and
balances principle, a private party can bring a “case” only if
it has standing—“a concrete and particularized injury that is
fairly traceable to the challenged conduct, and is likely to be
redressed by a favorable judicial decision.” Hollingsworth v.
Perry, 133 S. Ct. 2652, 2661 (2013) (citing Lujan, 504 U.S.
at 560–61). A generalized grievance is not enough; a plaintiff
must have more than merely an interest in seeing the law
obeyed. FEC v. Akins, 524 U.S. 11, 23–24 (1998); see also
Lujan, 504 U.S. at 572–78.

As part of our separation of powers foundation, the
Executive Branch is charged under our Constitution with the
enforcement of federal law. “Vindicating the public interest
(including the public interest in Government observance of
the Constitution and laws) is the function of Congress and the
Chief Executive.” Lujan, 504 U.S. at 576 (emphasis in
original); see also U.S. Const. art. II, § 3 (providing that the
President has the duty to “take Care that the Laws be
faithfully executed”). Thus, all parties (and JEP) agree that
the Executive Branch and its duly appointed officers are
excepted from the generalized grievance prohibition that
private parties face under Article III.

CFPB brought the suit in question to vindicate, as
codified by Congress, the public interest in making Gordon’s
victims whole and preventing him from further fleecing
vulnerable homeowners. Under Lujan, it is the Executive
Branch, not any particular individual, that has Article III
standing. 504 U.S. at 576; see also United States v.
Providence Journal Co., 485 U.S. 693, 700 (1988).
12 CONSUMER FIN. PROT. BUREAU V. GORDON

JEP argues that Cordray’s improper recess appointment
divests our court of jurisdiction. According to JEP, the lack
of a valid director from the outset means that the CFPB never
existed for Article III purposes until July 2013, when the
Senate confirmed Cordray, because the CFPB purportedly
could only operate with a properly confirmed director in
place. Not only did Cordray lack authority to initiate any
civil enforcement actions, the argument goes, but so did any
inferior officers that Cordray appointed—essentially an
Article II version of the fruit of the poisonous tree doctrine.
To make this unpredecented argument, JEP points to
Hollingsworth for support.

In Hollingsworth, same-sex couples sued California
officials, alleging that Proposition 8, which banned same-sex
marriage, violated their constitutional rights. 133 S. Ct. at
2659–60. The state officials refused to defend the law in
court (though they continued to enforce it), and the district
court permitted the original proponents of Proposition 8 to
intervene and defend it. Id. at 2660. After a bench trial, the
district court ruled in the plaintiffs’ favor, struck down
Proposition 8, and enjoined California officials from
enforcing the law. Id.

The California officials declined to appeal the case, but
the intervenors did. Id. Our court wondered whether the
intervenors had Article III standing, and asked the California
Supreme Court via certified question if the intervenors
possessed either a particularized interest in Proposition 8’s
validity or the authority to assert the State’s interest to defend
it. Id. The California Supreme Court replied that the
intervenors could assert the State’s interest to defend the
measure, but did not address whether the intervenors had their
own particularized interest in its validity. Id. Concluding
 CONSUMER FIN. PROT. BUREAU V. GORDON 13

that the intervenors had the requisite standing, our court then
reached the merits and struck down Proposition 8. Id. at
2660–61.

In a 5–4 decision, the Supreme Court dismissed the case
for lack of Article III standing. Id. at 2668. Citing Lujan, the
Court explained that the intervenors had no direct stake in the
litigation, but merely a “generalized grievance.” Id. at 2662.
Although they were proponents of the measure prior to its
enactment, they had “no role—special or otherwise—in the
enforcement of Proposition 8” post-enactment. Id. at
2662–63. This was true even though they wished to assert
California’s interest in the litigation, as “[i]n the ordinary
course, a litigant must assert his or her own legal rights and
interests, and cannot rest a claim to relief on the legal rights
or interests of third parties.” Id. at 2663 (quoting Powers v.
Ohio, 499 U.S. 400, 410 (1991)) (alteration in original). JEP
argues that because Cordray was improperly appointed, he
was a “private citizen” similar to the intervenors in
Hollingsworth, and therefore lacked Article III standing to
bring the CFPB’s suit against Gordon.

A straightforward reading of Hollingsworth confirms that
it has no impact on this case (and not even the dissent reads
it as JEP and Gordon do). Here, Congress authorized the
CFPB to bring actions in federal court to enforce certain
consumer protection statutes and regulations. See 12 U.S.C.
§ 5564(a)–(b) (authorizing the CFPB to “commence a civil
action against” violators of federal consumer financial
protection laws and “act in its own name and through its own
attorneys in enforcing” the laws under its jurisdiction). And
with this authorization, the Executive Branch, through the
CFPB, need not suffer a “particularized injury”—it is charged
under Article II to enforce federal law. See Lujan, 504 U.S.
14 CONSUMER FIN. PROT. BUREAU V. GORDON

at 576–77. That its director was improperly appointed does
not alter the Executive Branch’s interest or power in having
federal law enforced (and neither JEP nor Gordon point to
any statute or regulation suggesting otherwise). While the
failure to have a properly confirmed director may raise
Article II Appointments Clause issues, it does not implicate
our Article III jurisdiction to hear this case. See Providence
Journal, 485 U.S. at 700 (explaining that, even though the
special prosecutor who filed for a writ of certiorari was not
properly authorized to act on behalf of the United States
government, the case still “clearly is one in which the United
States is interested” (internal quotation marks omitted)).

If the CFPB, as an agency, had lost before the district
court and decided not to appeal, and a concerned citizen
wanted to intervene and bring the appeal, then Hollingsworth
would have relevance. That citizen, like the Proposition 8
intervenors, would be asserting nothing more than a
passionate but generalized grievance. But the CFPB, as part
of the Executive Branch, has never abandoned this lawsuit.
And because the Executive Branch need not demonstrate a
particularized injury, there is no Hollingsworth problem. See,
e.g., De Saracho v. Custom Food Mach., Inc., 206 F.3d 874,
878 n.4 (9th Cir. 2000) (noting that a lawsuit allegedly filed
without authorization does not result in the district court
“lack[ing] subject matter jurisdiction in the sense that it
would if plaintiffs lacked standing to sue under the ‘case or
controversy’ requirement of Article III of the Constitution”).

Providence Journal offers further support. The Court
dismissed that case because the special prosecutor lacked
authority to file the petition for certiorari. 485 U.S. at
699–700. The Court never cast that lack of authority as an
Article III standing problem—“in fact,” Providence Journal
 CONSUMER FIN. PROT. BUREAU V. GORDON 15

“[does] not discuss standing at all.” Hollingsworth, 133 S.
Ct. at 2655. Instead, the Court explained that the “action was
initiated in vindication of the ‘judicial power of the United
States,’ U.S. Const., Art. III, § 1 (emphasis added), and it is
that interest, unique to the sovereign, that continues now to be
litigated in this Court.” Providence Journal, 485 U.S. at 700.
The Court thereby confirmed that any issue with an
individual’s authorization to continue prosecuting the case
did not strip the United States of its Article III interest in
bringing the action. The dissent Bass-O-Matics the CFPB’s
authority to execute the laws (Article II) with the United
States’ interest in the case (Article III). The initially flawed
appointment of Cordray is an Article II question, and every
court confronted with this issue has analyzed it as such. See,
e.g., Freytag v. Commissioner, 501 U.S. 868, 878–79 (1991);
Buckley v. Valeo, 424 U.S. 1, 137–42 (1976); FEC v. Legi-
Tech, Inc., 75 F.3d 704, 705–06 (D.C. Cir. 1996).

Our holding tracks the cases in which the Supreme Court
has described Appointments Clause questions as
“nonjurisdictional,” even though they implicate core
separation of powers principles. For instance, in Freytag, the
Supreme Court examined whether the appointment of an
Article I court special tax judge satisfied the Appointments
Clause. 501 U.S. at 877. Even though that case, like ours,
involved important separation of powers issues “embedded in
the Appointments Clause,” the Court classified the issue as
“nonjurisdictional.” Id. at 878–79; see also id. at 893–94 (“A
party forfeits the right to advance on appeal a
nonjurisdictional claim, structural or otherwise, that he fails
to raise at trial.”) (Scalia, J., concurring in the judgment);
Buckley, 424 U.S. at 142 (stating that violations of
Appointments Clause did not negate past actions of Federal
Election Commission).
16 CONSUMER FIN. PROT. BUREAU V. GORDON

Buckley exemplifies this fundamental principle. The
Supreme Court in Buckley held that the Federal Election
Campaign Act violated the Appointments Clause, as it
permitted congressionally appointed FEC Commissioners to
discharge functions (including civil enforcement in federal
court) reserved only for “Officers of the United States.”
Buckley, 424 U.S. at 137–41. Under Gordon and JEP’s view,
this violation would raise irreparable Article III standing
problems, as these Commissioners (much like Cordray)
lacked the authority to take any steps on behalf of the FEC,
rendering any actions involving Article III litigation a nullity.
Rather than invalidate the FEC’s prior actions, the Court
instead accorded the Commission’s prior acts “de facto
validity” and granted a stay to allow Congress to take steps to
rectify the Article II problem and avoid “interrupting
enforcement” of the FECA’s valid provisions. Id. at 142–43.

Nowhere in Buckley did the Court suggest that the Article
II problems rendered the FEC a nullity for Article III
purposes, even though the Court discussed Article III earlier
in its opinion. See id. at 117–18. If Gordon and JEP were
correct, then the Court in Buckley would not have stayed
anything—rather, it would have entered an order dismissing
all FEC civil enforcement actions for lack of standing. When
confronted with a similar Article II problem, the D.C. Circuit
read the same passage in Buckley and rejected as “overstated”
the argument that an Article II defect “necessarily voids all
prior decisions” taken by FEC in civil enforcement actions.
See Legi-Tech, 75 F.3d at 708.3

3
The dissent’s attempts to distinguish these cases miss the mark. It
reads the D.C. Circuit’s opinion in Buckley to undermine the Supreme
Court’s holding in the same case, but then ignores the D.C. Circuit’s own
reading of Buckley in Legi-Tech, where the D.C. Circuit relies on Buckley
 CONSUMER FIN. PROT. BUREAU V. GORDON 17

We agree with the D.C. Circuit’s reading of Article II and
Buckley. Indeed, neither Gordon nor JEP cite a single
case—save for the inapplicable Hollingsworth—to support
the argument that an Appointments Clause problem deprives
our court of Article III jurisdiction. Nothing in Noel Canning
suggests that Appointments Clause problems divest federal
courts of jurisdiction. It is true that “any sub silentio
assumption of jurisdiction in a case [by the Supreme Court]
‘does not constitute binding authority’ on the jurisdictional
question.” Thompson v. Frank, 599 F.3d 1088, 1090 n.1 (9th
Cir. 2010) (quoting Burbank-Glendale-Pasadena Airport
Auth. v. City of Burbank, 136 F.3d 1360, 1363 (9th Cir.
1998)). At the same time, we cannot turn a blind eye to the
fact that no court, including the Supreme Court, has ever
suggested that Article II problems nullify Article III
jurisdiction. Absent clear instruction from the Supreme
Court, we will not hold so here.

to ratify prior enforcement actions originally instituted by an
unconstitutionally composed FEC. Dissent at 41–42; Legi-Tech, 75 F.3d
at 707. As for Freytag, we agree that the case “did not raise any question
regarding standing.” Dissent at 40. That is because “nonjurisdictional”
Appointments Clause situations like these do not raise Article III issues.

Perhaps most telling, the dissent (like JEP and Gordon) cannot
identify any authority that actually supports its position—that the United
States’ Article III interest in a case turns solely on the status of one of its
officers.
18 CONSUMER FIN. PROT. BUREAU V. GORDON

B. Appointments Clause4

The initial invalid appointment of Cordray also is not fatal
to this case. The subsequent valid appointment, coupled with
Cordray’s August 30, 2013 ratification, cures any initial
Article II deficiencies.5

We are not the first court to grapple with this issue. For
example, in Legi-Tech, the FEC brought an enforcement
action in federal court after finding probable cause that Legi-
Tech violated election laws. 75 F.3d at 707. Even though the
FEC was illegally constituted when it brought the action, it
cured this problem when the newly constituted Commission
re-approved the litigation decision. Id. at 708–09. The D.C.
Circuit concluded that even if the subsequent FEC “review”
was “nothing more than a ‘rubberstamp,’” it still satisfied the
Appointments Clause. Id. at 709.

4
Because we conclude that there is Article III standing, we need not
reach the question of whether ratification can cure a defect in Article III
standing, which the dissent addresses. See Dissent at 43–44.
5
We may address this issue even though the district court refused to
resolve it because Gordon “properly raised” it in the district court.
O’Rourke v. Seaboard Surety Co., 887 F.2d 955, 957 (9th Cir. 1989). For
an argument to be “properly raised,” it “must be raised sufficiently for the
trial court to rule on it.” Id. Here, Gordon undoubtedly raised the
argument that Cordray was invalidly appointed under the Appointments
Clause and, as a result, the enforcement action against Cordray was
invalid. As this is an issue of law that does not depend on any further
development of the facts, we may exercise our discretion to address it.
See El Paso City of Tex. v. Am. W. Airlines, Inc., 217 F.3d 1161, 1165 (9th
Cir. 2000); see also Self-Realization Fellowship Church v. Ananda Church
of Self-Realization, 59 F.3d 902, 912 (9th Cir. 1995).
 CONSUMER FIN. PROT. BUREAU V. GORDON 19

We agree with the D.C. Circuit’s approach. In reviewing
issues like these, the Supreme Court has looked to the
Restatement of Agency. See FEC v. NRA Political Victory
Fund, 513 U.S. 88, 98 (1994) (question of ratification is “at
least presumptively governed by principles of agency law”);
see also Doolin Sec. Sav. Bank, F.S.B. v. Office of Thrift
Supervision, 139 F.3d 203, 212–13 (D.C. Cir. 1998)
(applying Restatement of Agency to Appointments Clause
issue), superseded by statute on other grounds, Federal
Vacancies Reform Act of 1998, Pub. L. No. 105-277, 112
Stat. 2681, as recognized in SW Gen., Inc. v. NLRB, 796 F.3d
67, 70–71 (D.C. Cir. 2015).

Both Gordon and JEP recognize that for a ratification to
be effective, “it is essential that the party ratifying should be
able not merely to do the act ratified at the time the act was
done, but also at the time the ratification was made.” NRA
Political Victory Fund, 513 U.S. at 98 (emphasis in original)
(quoting Cook v. Tullis, 85 U.S. 332, 338 (1874)). This rule
of law is derived from the Second Restatement of Agency.
See id. Under the Second Restatement, if the principal (here,
CFPB) had authority to bring the action in question, then the
subsequent August 2013 ratification of the decision to bring
the case against Gordon is sufficient. See Restatement on
Agency (Second) § 84(1) (“An act which, when done, could
have been authorized by a purported principal, or if an act of
service by an intended principal, can be ratified if, at the time
of the affirmance, he could authorize such an act.”); Legi-
Tech, 75 F.3d at 707, 709. The Third Restatement, which is
less “stringent” than the Second, see Restatement on Agency
(Third) § 4.04 cmt. b, advises that a ratification is valid even
if the principal did not have capacity to act at the time, so
long as the person ratifying has the capacity to act at the time
of ratification, see id. § 4.04(1) (“A person may ratify an act
20 CONSUMER FIN. PROT. BUREAU V. GORDON

if (a) the person existed at the time of the act, and (b) the
person had capacity . . . at the time of ratifying the act.”). For
example, “if a personal representative has been appointed for
a principal, the personal representative may ratify on behalf
of the principal although the principal lacked capacity at the
prior time of the act that is ratified.” Id., cmt. b.

As we discussed above in the section rejecting Gordon’s
Article III challenge, Congress authorized the CFPB to bring
the action in question. See 12 U.S.C. § 5564(a)–(b). Because
the CFPB had the authority to bring the action at the time
Gordon was charged, Cordray’s August 2013 ratification,
done after he was properly appointed as Director, resolves
any Appointments Clause deficiencies. See Restatement
(Second) § 93(3) (“The affirmance can be made by an agent
authorized so to do.”); Intercollegiate Broad. Sys., Inc. v.
Copyright Royalty Bd., 796 F.3d 111, 121 (D.C. Cir. 2015)
(“[O]nce a new Board has been properly appointed (or
reconstituted), the Appointments Clause does not bar it from
reaching the same conclusion as its predecessor.”); Legi-
Tech, 75 F.3d at 707, 709 (writing that a newly constituted
FEC need not “start at the beginning” and “redo the
statutorily required procedures in their entirety”).6

6
Because we decide that Cordray’s ratification of the enforcement
action was effective, we need not address whether the original
constitutional error is susceptible to harmless error review and, if so,
whether the error here was harmless. We also need not decide whether the
officials’ decisions had de facto validity under the de facto officer
doctrine. See generally Ryder v. United States, 515 U.S. 177 (1995).
 CONSUMER FIN. PROT. BUREAU V. GORDON 21

C. Merits of Action Against Gordon

Gordon alleges that the district court erred in granting
summary judgment in favor of the CFPB on its claims that he
violated (1) 12 U.S.C. §§ 5531 and 5536 of the CFPA by
engaging in deceptive advertising (counts one through three)
and (2) Regulation O (counts four through seven).

a. Counts One through Three: Violations of the
CFPA, 12 U.S.C. §§ 5531, 5536

Section 5536(a)(1)(B) states that “[i]t shall be unlawful
for (1) any covered person or service provider . . . (B) to
engage in any unfair, deceptive, or abusive act or practice.”
See also id. § 5531(a) (stating that the CFPB may take action
to “prevent a covered person or service provider from
committing or engaging in an unfair, deceptive, or abusive
practice under Federal law”). A “covered person” is “any
person that engages in offering or providing a consumer
financial product or service.” Id. § 5481(6)(A). Loan
modification and foreclosure prevention services constitute
“consumer financial product[s] or service[s]” under the
statute. Id. § 5481(5), (15)(A)(viii)(II).

The district court concluded that Gordon falsely
represented that (1) consumers would obtain mortgage loan
modifications that would substantially reduce mortgage
payments or interest rates, (2) he would conduct forensic
audits that would substantially reduce mortgage payments,
and (3) he was affiliated with, endorsed by, or approved by
the United States government. Gordon challenges these
determinations on several grounds, all of which are
unavailing.
22 CONSUMER FIN. PROT. BUREAU V. GORDON

First, Gordon argues that the district court erred in
concluding at the summary judgment phase that his marketing
materials deceptively suggested an affiliation with the United
States government. An act or practice is deceptive if:
(1) “there is a representation, omission, or practice that,”
(2) “is likely to mislead consumers acting reasonably under
the circumstances,” and (3) “the representation, omission, or
practice is material.” FTC v. Pantron I Corp., 33 F.3d 1088,
1095 (9th Cir. 1994) (citation omitted).7

Gordon does not argue that misleading consumers to
believe that he was affiliated with the United States
government would be immaterial, see FTC v. Stefanchik,
559 F.3d 924, 928 (9th Cir. 2009), but instead asserts that the
mailings were not deceptive. “Deception may be found based
on the ‘net impression’ created by a representation.” Id.
(citation omitted). Here, there can be no dispute that the net
impression was deceptive. The mailer bore the Equal
Opportunity Housing logo, stated that it was a “Notice of
HUD Rights,” and that it was provided courtesy of the
“Qualification Intake Department.” See Floersheim v. FTC,
411 F.2d 874, 876–78 (9th Cir. 1969). The CFPB submitted
evidence that consumers were, in fact, deceived. Eventually,

7
The term “deceptive act or practice” has an established meaning in the
context of the Federal Trade Commission Act, 15 U.S.C. § 45(a), and
Congress used very similar phrasing in § 5536(a)(1)(B). Compare
§ 5536(a)(1)(B) (prohibiting “any unfair, deceptive, or abusive act or
practice”), with 15 U.S.C. § 45(a) (prohibiting “unfair or deceptive acts or
practices”). Accordingly, we adopt that meaning here. See United States
v. Novak, 476 F.3d 1041, 1051 (9th Cir. 2007) (“[C]ourts generally
interpret similar language in different statutes in a like manner when the
two statutes address a similar subject matter.”). Moreover, the parties
both apply cases interpreting § 45(a) to inform their analysis of
§ 5536(a)(1)(B).
 CONSUMER FIN. PROT. BUREAU V. GORDON 23

as Pessar testified, he stopped using the “Notice of HUD
Rights” mailer, as callers were complaining because they
thought they were getting in touch with a government agency.
The only evidence Gordon submits in response are his “bald
assertions” that the mailer was not deceptive, which is not
sufficient to create a triable issue of fact. Stefanchik,
559 F.3d at 929.

Second, Gordon argues that, even if the marketing
materials were deceptive, he cannot be held responsible
because Pessar and his company were in charge of marketing,
and Gordon had no control over the materials. An individual
may be liable for corporate violations if “(1) he participated
directly in the deceptive acts or had the authority to control
them and (2) he had knowledge of the misrepresentations,
was recklessly indifferent to the truth or falsity of the
misrepresentation, or was aware of a high probability of fraud
along with an intentional avoidance of the truth.” Id. at 931.8

There is no dispute of material fact that Gordon is liable
under this test, as he had control over the marketing materials
and knowledge of their contents. The CFPB submitted a
declaration from Pessar stating that “Gordon had final
decision-making authority for all marketing used by the
operation.” According to Pessar’s testimony, “Gordon
reviewed the scripts and any marketing material used by the
operation, and he edited and modified those items.” The
CFPB also submitted a business plan for Pessar’s and
Gordon’s loan modification venture that stated that “Mr.

8
We adopt the test for holding an individual liable for a corporation’s
actions used under the FTC Act. See supra n.7. Neither party objects to
the district court’s use of this test, and both apply it in their briefing to this
court.
24 CONSUMER FIN. PROT. BUREAU V. GORDON

Gordon will assure that all advertising is legal.” Further, the
CFPB submitted testimony from John Gearries, the office
manager at Gordon’s law firm, stating that he believed that
Gordon reviewed all the marketing materials, that Gordon
approved the use of the scripts read by sales representatives,
and that he had forwarded marketing materials to Gordon for
his review on at least one occasion. Finally, it submitted an
email from Gordon to Pessar in which Gordon states:
“Mainly, as it pertains to how existing clients will be pitched,
representations made to the public in marketing our services
. . . my word is the law. Period.”

Gordon’s only attempt to dispute this evidence is his own
declaration, in which he states that he had no control over
marketing, was not responsible for representations made by
sales personnel, and had no authority to approve or reject
mailers. This “conclusory, self-serving affidavit” is
insufficient to raise a triable issue of fact as to whether
Gordon had authority to control advertising because it lacks
“detailed facts and any supporting evidence.” FTC v. Publ’g
Clearing House, Inc., 104 F.3d 1168, 1171 (9th Cir. 1997);
see also Nigro v. Sears, Roebuck & Co., 784 F.3d 495,
497–98 (9th Cir. 2015). Moreover, it is undermined because
it contradicts Gordon’s prior statements in his emails to
Pessar. See Kennedy v. Applause, Inc., 90 F.3d 1477, 1481
(9th Cir. 1996).

Third, Gordon argues the agreements that his clients
eventually signed, which accurately described the services he
would perform, corrected any deceptive practices in which
Gordon or Pessar might have engaged. These written
agreements, however, do not absolve Gordon of liability. A
later corrective written agreement does not eliminate a
defendant’s liability for making deceptive claims in the first
 CONSUMER FIN. PROT. BUREAU V. GORDON 25

instance. See Resort Car Rental Sys., Inc. v. FTC, 518 F.2d
962, 964 (9th Cir. 1975) (per curiam) (explaining that
advertising is deceptive “if it induces the first contact through
deception, even if the buyer later becomes fully informed
before entering the contract”).

Finally, Gordon asserts that the representations in the
advertising materials were mere “puffery.” Gordon does not,
however, identify any specific representations or explain why
they constitute puffery. Accordingly, this argument is
waived. See Greenwood v. FAA, 28 F.3d 971, 977 (9th Cir.
1994) (finding that “a bare assertion does not preserve a
claim, particularly when, as here, a host of other issues are
presented for review”).

b. Counts Four through Seven: Violations of
Regulation O

In counts four through seven, the CFPB alleged that
Gordon violated Regulation O by (1) receiving up-front
payments for mortgage assistance relief services, (2) not
making required disclosures, (3) informing consumers not to
contact lenders, and (4) misrepresenting material aspects of
his services. Regulation O contains several provisions that
apply only to “mortgage assistance relief service provider[s].”
12 C.F.R. §§ 1015.3–1015.5. A “mortgage assistance relief
service provider” is any person that provides “any service,
plan, or program, offered or provided to the consumer in
exchange for consideration, that is represented, expressly or
by implication, to assist or attempt to assist the consumer
with,” among other things, obtaining a loan modification or
preventing foreclosure. Id. § 1015.2.
26 CONSUMER FIN. PROT. BUREAU V. GORDON

Gordon’s only defense on these counts is that he was not
a “mortgage assistance relief service provider” under the
meaning of Regulation O because he did not provide the
mortgage relief services at issue “in exchange for
consideration.” Instead, he argues, he charged fees
exclusively for “custom legal products,” and the loan
modification services were provided free of charge, as part of
a “pro bono program.” This obvious attempt to evade the
requirements of Regulation O fails. It is undisputed that
Gordon’s “pro bono” services were in reality in exchange for
consideration, because consumers were eligible for the “pro
bono” modification services only if they signed up for and
paid the fees for the legal products. Gordon suggests that this
court is bound by the language in his contract, stating this his
services were “pro bono,” but nothing in the regulations
suggest that this court must close its eyes to the facts and rely
only on the contract itself to determine whether the services
were actually “in exchange for consideration.” Id. § 1015.2.

Because there is no dispute as to a material fact regarding
Gordon’s liability, the CFPB is entitled to summary judgment
on all counts.

D. Remedies

Under the CFPA, the CFPB may seek various forms of
relief in an enforcement action, including a permanent or
temporary injunction, restitution, and disgorgement.
12 U.S.C. §§ 5564(a), 5565. Gordon argues that the district
court abused its discretion when it (1) imposed an equitable
monetary judgment against him in the amount of
$11,403,338.63 and (2) granted CFPB’s request for injunctive
relief, which prohibits Gordon from providing any mortgage
assistance relief product or service for a period of three years.
 CONSUMER FIN. PROT. BUREAU V. GORDON 27

a. Monetary Judgment

As stated above, the district court entered a
$11,403,338.63 judgment against Gordon for disgorgement
and restitution. Disgorgement is a remedy in which a court
orders a wrongdoer to turn over all profits obtained by
violating the law. See SEC v. JT Wallenbrock & Assocs.,
440 F.3d 1109, 1113 (9th Cir. 2006). A district court has
“broad equity powers to order” disgorgement, and its
“disgorgement calculation requires only a reasonable
approximation of profits causally connected to the violation.”
Id. at 1113–14 (internal quotation marks and citation
omitted).

Restitution “is a form of ancillary relief” that a court can
order “[i]n the absence of proof of ‘actual damages.’” FTC
v. Gill, 265 F.3d 944, 958 (9th Cir. 2001). Restitution may be
measured by the “full amount lost by consumers rather than
limiting damages to a defendant’s profits.” Stefanchik,
559 F.3d at 931. Our circuit has adopted a two-step burden-
shifting framework for calculating restitution awards under
the FTC Act, which the district court applied below and we
apply here. See FTC v. Commerce Planet, Inc., No. 12-
57064, slip op. at 17 (9th Cir. Mar. 3, 2016). Under the first
step, the government “bears the burden of proving that the
amount it seeks in restitution reasonably approximates the
defendant’s unjust gains.” Id. A district court may use a
defendant’s net revenues as a basis for measuring unjust
gains. Id. at 18; see also Gill, 265 F.3d at 958 (“In the
absence of proof of ‘actual damages,’ the court properly used
the amounts consumers paid as the basis for the amount
Defendants should be ordered to pay for their wrongdoing.”).
If the government makes this threshold showing, the burden
shifts to the defendant to demonstrate that the net revenues
28 CONSUMER FIN. PROT. BUREAU V. GORDON

figure overstates the defendant’s unjust gains. See Commerce
Planet, slip op. at 18.

Here, the CFPB demonstrated that Gordon, Pessar, and
their respective entities collected $11,403,338.63 from
consumers from January 2010 through July 2012. The
burden then shifted to Gordon to demonstrate that the
defendants’ unjust gains were less than that amount. In most
of his objections to the judgment, Gordon fails to meet this
burden.

First, Gordon argues that the district court should not have
included fees paid by “satisfied” consumers. There is no
precedent for this proposition. See Gill, 265 F.3d at 958
(rejecting a defendant’s claim that fees paid by consumers
who have benefitted from the services should be excluded
from restitution because there was “no authority” for such an
argument). Moreover, even if there were, Gordon fails to
point to any evidence regarding which or how many
consumers were “satisfied” with their services, and therefore
fails to meet his burden.

Second, Gordon argues that the district court should not
have included fees that he refunded to consumers. Gordon,
however, failed to meet his burden to demonstrate that such
amounts should be subtracted from his unjust gains because,
as the district court noted, Gordon did not submit any
admissible evidence that he had refunded consumers, making
only the unsubstantiated statement that he has made
“reimbursement[s] to dissatisfied customers.” See Stefanchik,
559 F.3d at 931.

Third, Gordon argues that the district court should not
have included fees paid by consumers who were not
 CONSUMER FIN. PROT. BUREAU V. GORDON 29

persuaded by the fraudulent materials. The government,
however, is entitled to the presumption that the individuals
who utilized Gordon’s services did so in reliance on the
misrepresentations. See Commerce Planet, slip op. at 19;
FTC v. Figgie Int’l Inc., 994 F.2d 595, 605 (9th Cir. 1993)
(per curiam). While this would not necessarily foreclose
Gordon from presenting evidence of non-reliance, he did not
do so.

Fourth, Gordon argues that the facts do not justify any
monetary award against him, because Pessar was in charge of
the advertising that led to counts one through three and “most
of the money went to Pessar.” Our precedent is clear that
“[e]quity may require a defendant to restore his victims to the
status quo where the loss suffered is greater than the
defendant’s unjust enrichment.” Stefanchik, 559 F.3d at 931;
see also Commerce Planet, slip op. at 10–11 (explaining that
there is “no support in our case law” for the proposition that
a restitution award “must be limited to the unjust gains each
defendant personally received”). Moreover, as described
above, Gordon had control over and approved the marketing
materials used, and it was not an abuse of discretion for the
district court to hold Gordon and his entities jointly and
severally liable for the full amount. Stefanchik, 559 F.3d at
931–32 & n.1 (holding that there was no abuse of discretion
where the district court found an individual, Stefanchik, and
the corporation he solely owned, Beringer Corporation,
jointly and severally liable for the full amount of sales made,
despite other defendants settling, where Stefanchik and
Beringer were the “driving force behind the marketing
scheme”).

Lastly, Gordon challenges the time period, January 2010
through July 2012, which the district court used to calculate
30 CONSUMER FIN. PROT. BUREAU V. GORDON

the monetary judgment. While his argument is unclear,
Gordon appears to argue that it was improper for the district
court to include the time period prior to the effectiveness of
Regulation O. See 12 C.F.R. §§ 1015.1–11. It also appears
that the relevant provisions of the CFPA were not in effect for
the entire time period. See Dodd-Frank Reform and
Consumer Protection Act, Pub. L. No. 111-203, 124 Stat.
1376 (2010).

While retroactivity of legislation and regulations is not
per se unlawful, we have a presumption against retroactivity
that generally requires “that the legal effect of conduct . . .
ordinarily be assessed under the law that existed when the
conduct took place.” Landgraf v. USI Film Prods., 511 U.S.
244, 265 (1994) (applying the presumption against
retroactivity to statutes); Bowen v. Georgetown Univ. Hosp.,
488 U.S. 204, 208 (1988) (applying the presumption to
regulations). Although undecided in our circuit, it may be
impermissible to enforce some provisions of the Dodd-Frank
Act (of which the CFPA is a part and which granted the
rulemaking authority that led to Regulation O, see 12 U.S.C.
§ 5512) retroactively. See Koch v. SEC, 793 F.3d 147,
157–58 (D.C. Cir. 2015) (addressing the issue and finding
that the SEC may not use the remedial provisions of the 2010
Dodd-Frank Act to punish Koch for his conduct in 2009);
Campbell v. Nationstar Mortg., 611 F. App’x 288, 296–98
(6th Cir. 2015) (affirming the district court’s decision not to
apply a CFPB regulation promulgated under the Dodd-Frank
Act and the Real Estate Settlement Procedures Act (RESPA)
retroactively, agreeing that an “effective date reflects an
intent not to apply it to conduct occurring prior to that date”).
We vacate and remand for the district court to consider
whether it is appropriate to include in its judgment against
Gordon money that Gordon earned in the time period prior to
 CONSUMER FIN. PROT. BUREAU V. GORDON 31

the enactment or effectiveness of Regulation O and the
relevant portions of the CFPA.

b. Injunctive relief

“[T]he decision whether to grant or deny injunctive relief
rests within the equitable discretion of the district courts.”
eBay Inc. v. MercExchange, LLC, 547 U.S. 388, 394 (2006).
Gordon argues that the district court abused its discretion in
ordering injunctive relief because it was not clear that
Gordon’s “wrongs [were] ongoing or likely to recur.” FTC
v. Evans Prods. Co., 775 F.2d 1084, 1087 (9th Cir. 1985)
(“As a general rule, past wrongs are not enough for the grant
of an injunction[.]”) (internal quotation marks and citations
omitted). According to Gordon, his “lack of desire and
ability to continue to assist distressed homeowners in the
future created a factual dispute sufficient to deny an
injunction.”

Assuming it applies here, the district court did not run
afoul of Evans Products.9 Unlike in Evans Products, where
the district court made no finding that the defendant’s
misconduct was likely to recur, see 775 F.2d at 1088, the

9
The FTC had authority to pursue the action in Evans Products under
15 U.S.C. § 53(b), which gives the FTC authority to pursue injunctive
relief only if it can show that a person “‘is violating, or is about to violate’
any law enforced by the FTC; the statute does not mention past
violations.” 775 F.2d at 1087 (quoting 15 U.S.C. § 53(b)(1)). The
provisions of the CFPA that give the CFPB authority to pursue injunctive
relief do not have that same limiting language. See 12 U.S.C. § 5564(a)
(giving CFPB authority to seek “all appropriate legal and equitable relief
. . . permitted by law”); id. § 5565(a)(1) (giving courts “jurisdiction to
grant any appropriate legal or equitable relief with respect to a violation
of Federal consumer financial law”).
32 CONSUMER FIN. PROT. BUREAU V. GORDON

district court specifically found that Gordon presented an
ongoing risk to consumers. This was not an abuse of
discretion. The record reflects that Gordon was continually
willing to evade and complicate the investigatory process in
ways that undermined his “sincere assurances” against future
violations. During the investigation, Gordon threatened the
CFPB and California State Bar investigators with
“lawlessness” and “anarchy.” Many similarly colorful and
vaguely threatening emails followed. The district court did
not abuse its discretion in concluding that Gordon presented
a risk of future harm if he immediately returned to working
with distressed homeowners without limitation.

Additionally, the record reflects that the district court
carefully considered the scope of the injunction and tailored
it to match the risk of harm it identified and minimize the
impact on Gordon’s legal business. The district court
concluded that the first proposed injunction was too broad, as
it contained provisions that would “unduly limit Gordon’s
ability to engage in lawful employment” with restrictions that
lacked “any corresponding benefit to consumers.” It required
the parties to meet and confer to compose a narrower
injunction. Due to its reasonable finding of future harm and
its efforts to narrowly tailor the injunction, there is no basis
for holding that the district court abused its discretion.

IV. CONCLUSION

This case requires us to decide whether an agency exists
for Article III purposes when its director lacks constitutional
authority to act on its behalf, similar to the age old question,
“If a tree falls in a forest and no one is around to hear it, does
it make a sound?” For purposes of Article III, we believe the
answer to both questions is a resounding yes. Moreover,
 CONSUMER FIN. PROT. BUREAU V. GORDON 33

because Director Cordray ratified the decision to bring the
action against Gordon after his proper nomination and Senate
confirmation, there is no Appointments Clause issue.

Additionally, because Gordon has failed to demonstrate
that there is any dispute of material fact as to his liability
under the CFPA or Regulation O, the district court properly
granted summary judgment in favor of the CFPB. Further,
because the district court conscientiously tailored the
injunction at issue, it did not abuse its discretion in granting
equitable judgment. However, because the district court may
have impermissibly entered a monetary judgment against
Gordon for a time period prior to the enactment or effective
date of the relevant provisions of the CFPA and Regulation
O, we vacate and remand for further consideration.

We AFFIRM in part and VACATE AND REMAND in
part for reconsideration of the monetary judgment.

The parties shall bear their own costs on appeal.

IKUTA, Circuit Judge, dissenting:

Who was exercising the executive power of the United
States needed to bring this civil enforcement action? Not
Richard Cordray — he was not properly appointed by the
President and so was not an Officer of the United States at the
time the action was filed. Not the Consumer Financial
Protection Bureau — without an Officer of the United States,
it was a mere Congressional creation that could not exercise
executive power. In fact, no one had the executive power
necessary to prosecute this civil enforcement action in the
34 CONSUMER FIN. PROT. BUREAU V. GORDON

district court. And without the Executive’s power to “take
Care that the Laws be faithfully executed,” U.S. Const. art. II,
§ 3, no one could claim the Executive’s unique Article III
standing. Because the plaintiff here lacked executive power
and therefore lacked Article III standing, the district court
was bound to dismiss the action.

Today the majority flouts this most basic constitutional
limit to our authority by failing to give a single reason why
the Bureau had standing here. The majority’s view of
jurisdiction reduces to zero the “irreducible constitutional
minimum of standing,” Lujan v. Defs. of Wildlife, 504 U.S.
555, 560 (1992), and vitiates the standing requirement’s vital
role in preventing “the judicial process from being used to
usurp the powers of the political branches,” Hollingsworth v.
Perry, 133 S. Ct. 2652, 2661 (2013) (quoting Clapper v.
Amnesty Int’l USA, 133 S. Ct. 1138, 1146 (2013)). I decline
to participate in this power grab, and therefore I dissent.

I

The plaintiff here is the Consumer Financial Protection
Bureau, which was created by the Consumer Financial
Protection Act in 2010. The Act specified that the Bureau is
an executive agency, 12 U.S.C. § 5491(a), and would have a
director who would be “appointed by the President, by and
with the advice and consent of the Senate,” id.
§ 5491(b)(1)–(2). This statutory language tracks the language
of the Appointments Clause, ensuring that the Director of the
Bureau is also an Officer of the United States. U.S. Const.
 CONSUMER FIN. PROT. BUREAU V. GORDON 35

art. II, § 2.1 The Act gave the Bureau broad powers,
including the authority to commence civil litigation against
any person who violates a Federal consumer financial law.
12 U.S.C. § 5564(a)–(b).

After the Act became law, President Obama appointed
Richard Cordray as the Director of the Bureau under the
Recess Appointments Clause, U.S. Const. art. II, § 2, cl. 3,
while the Senate was in a brief recess between two pro forma
sessions. In NLRB v. Noel Canning, the Supreme Court held
that President Obama’s appointments to the NLRB were
invalid exercises of the Recess Appointment power. 134 S.
Ct. 2550, 2557 (2014). Because these appointments were
made on the same day and through the same method as
President Obama’s appointment of Cordray to the CFPB,
there is no dispute that Cordray was not properly appointed
under the Constitution or the Act and was therefore not an
Officer of the United States with executive authority.
12 U.S.C. § 5491(b)(2)–(3); NLRB v. Noel Canning, 134 S.
Ct. 2550 (2014). The Bureau does not claim that some other
person in the Bureau had the requisite executive authority of
an Officer of the United States. Of course, Cordray could not

1
The Appointments Clause states:

[The President] shall nominate, and by and with the
Advice and Consent of the Senate, shall appoint
Ambassadors, other public Ministers and Consuls,
Judges of the supreme Court, and all other Officers of
the United States, whose Appointments are not herein
otherwise provided for, and which shall be established
by Law: but the Congress may by Law vest the
Appointment of such inferior Officers, as they think
proper, in the President alone, in the Courts of Law, or
in the Heads of Departments.
36 CONSUMER FIN. PROT. BUREAU V. GORDON

give his subordinates executive authority that he did not
possess. See, e.g., Olympic Fed. Sav. & Loan Ass’n v. Dir.,
Office of Thrift Supervision, 732 F. Supp. 1183, 1200 (D.D.C.
1990) (“[E]ach of the Directors could not delegate more
authority than he himself had.”). As explained below, this
means that on July 18, 2012, when a civil enforcement action
was filed against Chance Gordon and The Gordon Law Firm,
P.C., neither the Bureau nor anyone in it had executive
authority, and therefore the Bureau lacked standing to bring
this action.

A

In order to establish standing, a plaintiff must prove “a
concrete and particularized injury that is fairly traceable to
the challenged conduct, and is likely to be redressed by a
favorable judicial decision.” Hollingsworth, 133 S. Ct. at
2661 (citing Lujan, 504 U.S. at 560–61). An “injury to the
interest in seeing that the law is obeyed” does not suffice to
satisfy the standing inquiry, at least when the person suing is
a private citizen. See FEC v. Akins, 524 U.S. 11, 24 (1998).

Enforcement actions brought by the Executive satisfy the
requirements of Article III for purposes of a federal court’s
subject matter jurisdiction. The Constitution imposes on the
President the duty to “take Care that the Laws be faithfully
executed,” U.S. Const. art. II, § 3, and an important
component of that duty is obtaining criminal convictions for
violations of law in federal court, see United States v.
Valenzuela-Bernal, 458 U.S. 858, 863 (1982), as well as
enforcing and defending federal law in civil suits, see, e.g.,
Buckley v. Valeo, 424 U.S. 1, 138 (1976) (“A lawsuit is the
ultimate remedy for a breach of the law, and it is to the
President, and not to the Congress, that the Constitution
 CONSUMER FIN. PROT. BUREAU V. GORDON 37

entrusts the responsibility to ‘take Care that the Laws be
faithfully executed.’” (quoting U.S. Const. art. II, § 3)). The
Executive has a unique need to access the federal courts in
order to fulfill this constitutional responsibility for ensuring
that public rights are enforced, and such an executive
enforcement action is a “Case” or “Controversy” that satisfies
Article III. See Steel Co. v. Citizens for a Better Env’t,
523 U.S. 83, 102 n.4 (1998) (confirming that the Court’s
standing jurisprudence “derives from Article III and not
Article II,” even when it has “an impact on Presidential
powers”). Therefore, federal courts have jurisdiction over
such executive actions under Article III. See In re Debs,
158 U.S. 564, 586 (1895) (holding that when the government
acts to enforce public rights, “the mere fact that the
government has no pecuniary interest in the controversy is
not sufficient to exclude it from the courts”).

There is only one way for a plaintiff to obtain the
Executive’s Article III standing to enforce public rights in
federal court: the plaintiff must be vested with executive
authority. The Constitution vests the executive power “in a
President of the United States of America.” U.S. Const. art.
II, § 1. The President may authorize others to exercise
executive authority pursuant to the Appointments Clause of
the Constitution, U.S. Const. art. II, § 2, which requires the
President to appoint principal officers with the “Advice and
Consent” of the U.S. Senate.2 See Buckley, 424 U.S. at
125–27. Because the Appointments Clause provides “the
only authorization for appointment of those to whom

2
Inferior officers may be appointed by the President alone, the heads of
departments, or the judiciary, as Congress may determine, but it is
undisputed that no inferior officer was involved in the civil enforcement
action here.
38 CONSUMER FIN. PROT. BUREAU V. GORDON

substantial executive or administrative authority is given by
statute,” id. at 124–25, any person exercising significant
executive authority must “be appointed in the manner
prescribed” by that clause, id. at 126. A person properly
appointed would thus have standing to file suit in vindication
of public rights. Id. at 126, 140.

We know that Cordray was not properly appointed by the
President and therefore did not have any authority to enforce
public rights. As a result, Cordray lacked the Executive’s
unique Article III standing.

And without Cordray, or any properly appointed Officer
of the United States, the Bureau lacked any executive
authority that would allow it to enforce public rights.
Contrary to the majority, Maj. op. at 13–14, Congress cannot
by itself confer executive authority to bring a civil
enforcement action on an entity created by statute. See
Buckley, 424 U.S. at 137–38. In Buckley, the Court
considered a provision in the 1974 Amendments to the
Federal Election Campaign Act (FECA) that empowered the
Federal Election Commission (FEC) to file civil enforcement
suits. Id. at 6, 111. Because FECA gave Congress the right
to appoint a majority of the FEC’s members, id. at 126–27,
Buckley held that the FEC could not exercise the FECA’s
grant of enforcement power or conduct civil litigation. Id. at
137–40. Only the President and persons who are “Officers of
the United States” could do so. Id. at 139–40. Buckley
therefore struck down the provisions in FECA “vesting in the
[FEC] primary responsibility for conducting civil litigation in
the courts of the United States for vindicating public rights.”
Id. at 140. In light of Buckley’s reasoning, the Act’s
statement that the Bureau is an Executive Branch agency is
not enough to give the Bureau the Executive’s enforcement
 CONSUMER FIN. PROT. BUREAU V. GORDON 39

authority. Cf. Maj. op. at 13–14. As a result, the Bureau did
not have the Executive’s unique Article III standing.3

If neither Cordray nor the Bureau had standing, then no
one before the district court in this case had Article III
standing to bring this action against Gordon and his law firm.4
Since Article III standing is assessed at the time an action is
filed and must be met throughout all stages of litigation in the
federal courts, Hollingsworth, 133 S. Ct. at 2661, the district
court had a duty to determine whether the Bureau had
standing before ruling on the enforcement action. WildEarth
Guardians v. EPA, 759 F.3d 1064, 1070 (9th Cir. 2014)
(quoting Summers v. Earth Island Inst., 555 U.S. 488, 499
(2009)). Because the requirements of Article III were not
satisfied when the Bureau filed this action, the district court
was obliged to dismiss it for want of subject matter
jurisdiction. We are now required to do the same.
Hollingsworth, 133 S. Ct. at 2659.

B

The majority fails to even address how a Bureau with no
executive power has standing to bring a civil enforcement

3
Nor can Congress confer the Executive’s unique Article III standing to
private individuals. See Lujan, 504 U.S. at 573–74 (holding that Congress
cannot confer the Executive’s standing to enforce public rights on private
individuals through “citizen-suit” provisions); see also Vt. Agency of Nat.
Res. v. U.S. ex rel. Stevens, 529 U.S. 765, 772–74 (2000) (holding that
private individuals can assert the federal government’s interests in a qui
tam suit because they have their own pecuniary interest as partial
assignees of the government’s pecuniary claim).
4
Neither Richard Cordray nor the Bureau allege any injury in fact that
would otherwise provide standing under Article III.
40 CONSUMER FIN. PROT. BUREAU V. GORDON

action. Instead of providing reasoning, the majority merely
makes the conclusory statement that the Bureau is “part of the
Executive Branch,” Maj. op. at 14, which does not explain the
source of the Bureau’s executive power. The majority then
points to two cases rejecting Appointments Clause claims as
“nonjurisdictional.” Maj. op. at 15. But these cases give the
majority no support because neither addressed the issue of
standing. The first case, Freytag v. Commissioner, addresses
only the question whether a court should entertain an
argument that had not been raised below. Freytag ruled that
a statute authorizing the Chief Judge of the Tax Court to
assign any proceeding to a special trial judge did not violate
the Appointments Clause. 501 U.S. 868 (1991). As a
preliminary housekeeping matter, the Court held that it could
consider the appellants’ Appointments Clause objection to the
judicial officer for the first time on appeal because such
objection was “in the category of nonjurisdictional structural
constitutional objections that could be considered on appeal
whether or not they were ruled upon below.” Id. at 878–79.
Because there was no dispute that the petitioners (who had
been ordered to pay taxes owed to the federal government)
had suffered a concrete and particularized injury, this case did
not raise any question regarding standing and therefore
provides no support to the majority’s theory that the court has
jurisdiction to hear a claim brought by a plaintiff who lacks
the Executive’s unique Article III standing to bring an
enforcement action.

Nor did the majority’s second authority, Buckley, hold
that a court has jurisdiction over a civil enforcement action
brought by someone who lacks standing. See Maj. op. at
15–16. Of course, Buckley did not address the FEC’s
standing at all, and thus has no precedential effect on this
issue. See Steel Co., 523 U.S. at 91. Moreover, contrary to
 CONSUMER FIN. PROT. BUREAU V. GORDON 41

the majority, Buckley did not hold that the FEC could bring
civil enforcement actions at a time when it lacked the
Executive’s enforcement authority. Maj. op. at 16. Rather,
the Court accorded de facto validity only to the FEC’s past
administrative actions and legislative determinations that
were analogous to the powers that Congress could delegate to
one of its own committees. Buckley, 424 U.S. at 142.
Specifically, the Court held that the FEC’s inability to
exercise enforcement powers “because of the method by
which its members have been selected” did not “affect the
validity of the Commission’s administrative actions and
determinations to this date, including its administration of
those provisions, upheld today, authorizing the public
financing of federal elections” and so those “past acts of the
Commission are therefore accorded de facto validity, just as
we have recognized should be the case with respect to
legislative acts performed by legislators held to have been
elected in accordance with an unconstitutional apportionment
plan.” Id. (emphasis added); see also id. at 137.

Indeed, at the time the Court ruled, it appears that the
FEC had not yet even exercised its enforcement authority. As
Buckley explained, the D.C. Circuit had ruled that it could not
address the constitutionality of the FEC’s enforcement
authority because it was not yet ripe for resolution. Id. at 115
n.157; see also Buckley v. Valeo, 519 F.2d 821, 893 (D.C.
Cir. 1975) (“No party has been joined in a civil enforcement
action initiated by the Commission.”). The Court disagreed
with the D.C. Circuit on the ripeness issue, but only because
by that time, the FEC “ha[d] undertaken to issue rules and
regulations,” and “[w]hile many of its other functions
remain[ed] as yet unexercised, the date of their all but certain
exercise [was] now closer by several months than it was at
the time the Court of Appeals ruled.” 424 U.S. at 116–17.
42 CONSUMER FIN. PROT. BUREAU V. GORDON

Based on these and other statements in Buckley, it is clear that
the FEC had not undertaken any enforcement action at the
time the Court ruled (or at least, the Court did not know of
any), and therefore we cannot infer that the Court accorded de
facto validity to such actions.5

Because Freytag and Buckley are inapposite and did not
address the standing issue before us here, the majority has no
support for its conclusion that the Bureau has standing to
bring a civil enforcement action to enforce the Act. Instead
of explaining why the Bureau has standing under Article III,
the majority instead claims that the Bureau’s standing to
bring a civil enforcement action is not affected by the
President’s failure to appoint Cordray under Article II and
accuses the dissent of conflating Article II and Article III.
Maj. op. at 15. But this is backwards. The improper
appointment of Cordray merely deprived the Bureau of one
basis for standing. In most cases, an executive agency has
Article III standing because it has a director properly vested
with executive authority under Article II, but it is undisputed
that the Bureau cannot claim standing on this basis. So the
real question is: what is the alternative basis for the Bureau’s
standing? Instead of providing one, the majority merely
reiterates that Congress enacted a statute stating that the
Bureau is part of the Executive Branch. Maj. op. at 14. But
Congress cannot confer executive authority to bring a civil
enforcement action on an entity created by statute, see

5
The majority cites Legi-Tech for the proposition that the D.C. Circuit
interpreted Buckley as retroactively validating civil enforcement actions
brought by an improperly constituted FEC. Maj. op. at 16. This is
mistaken: Legi-Tech held that a properly constituted FEC had the
authority to continue an enforcement action, and did not address any
standing issue. FEC v. Legi-Tech, Inc., 75 F.3d 704 (D.C. Cir. 1996).
 CONSUMER FIN. PROT. BUREAU V. GORDON 43

Buckley, 424 U.S. at 137–38, so this rationale fails. In sum,
the majority offers no explanation for the Bureau’s standing
because it has none.

II

Because Article III standing must exist at the time a
complaint is filed, Richard Cordray’s August 30, 2013,
ratification could not retroactively cure the district court’s
lack of jurisdiction.

Federal courts have consistently rejected arguments that
a later act can cure a lack of standing at the time suit was
filed. Thus, where a plaintiff files a complaint before its
asserted injury occurred, it lacks standing even if a sufficient
injury-in-fact occurs while the case is pending. See Police &
Fire Ret. Sys. of Detroit v. IndyMac MBS, Inc., 721 F.3d 95,
110 (2d Cir. 2013) (“[W]e hold that the Rule 15(c) ‘relation
back’ doctrine does not permit members of a putative class,
who are not named parties, to intervene in the class action as
named parties in order to revive claims that were dismissed
from the class complaint for want of jurisdiction.”); Utah
Ass’n of Ctys. v. Bush, 455 F.3d 1094, 1101 & n.6 (10th Cir.
2006) (holding that “[b]ecause standing is determined as of
the time of the filing of the complaint,” the plaintiff’s alleged
subsequent injury could not serve as a basis for standing).
Similarly, the intervention of a party with standing after an
action has been filed “cannot cure any jurisdictional defect
that would have barred the federal court from hearing the
original action.” 7 Charles Alan Wright, Arthur R. Miller, et
al., Federal Practice and Procedure § 1917 (3d ed. 2005); see
also Disability Advocates, Inc. v. N.Y. Coalition for Quality
Assisted Living, Inc., 675 F.3d 149, 160–62 (2d Cir. 2012)
(“[I]f jurisdiction is lacking at the commencement of a suit,
44 CONSUMER FIN. PROT. BUREAU V. GORDON

it cannot be aided by the intervention of a plaintiff with a
sufficient claim.” (alterations omitted)).

At the time the Bureau filed this enforcement action, it
had no standing because it had no executive authority to
vindicate the public interest in federal court. While the
President subsequently properly appointed an Officer of the
United States to the position of Director, who could then
constitutionally bring an enforcement action, that official
could not retroactively cure the Bureau’s lack of standing.
Cf. FEC v. NRA Political Victory Fund, 513 U.S. 88, 90,
98–99 (1994) (holding that the Solicitor General’s ratification
of an unauthorized petition for certiorari could not cure a
failure to meet the “mandatory and jurisdictional” 90-day
deadline to file a petition).

III

Because the Bureau lacked standing when it brought this
enforcement action, we lack jurisdiction. This conclusion
undoubtedly applies to numerous other enforcement actions
taken by the Bureau for the 18 months of its existence before
Richard Cordray was properly confirmed by the Senate in
July 2013. But while the Supreme Court understands the
practical consequences of invalidating large numbers of
agency actions, it has nevertheless done so when the law
requires. See Noel Canning v. NLRB, 705 F.3d 490, 493
(D.C. Cir. 2013), aff’d 134 S. Ct. 2550 (2014) (holding that
because there was no quorum of validly appointed board
members, the NLRB “lacked authority to act,” and the
enforcement order was therefore “void ab initio”); see also
New Process Steel, L.P. v. NLRB, 560 U.S. 674, 687–88
(2010); id. at 689 (Kennedy, J., dissenting) (“Under the
Court’s holding, the Board was unauthorized to resolve the
 CONSUMER FIN. PROT. BUREAU V. GORDON 45

more than 500 cases it addressed during those 26 months in
the course of carrying out its responsibility . . . .”).

We likewise have a duty to dismiss this case for lack of
Article III jurisdiction, practical effects notwithstanding.
“[N]o principle is more fundamental to the judiciary’s proper
role in our system of government than the constitutional
limitation of federal-court jurisdiction to actual cases or
controversies.” DaimlerChrysler Corp. v. Cuno, 547 U.S.
332, 341 (2006). The limitations imposed by Article III may
not be swept aside for “the sake of convenience and
efficiency.” Raines v. Byrd, 521 U.S. 811, 820 (1997).
Because the majority ignores these fundamental limits to our
Constitutional authority, I dissent.