The full Court of Appeals for the D.C. Circuit has vacated an earlier decision that would have allowed the Trump administration to move forward with mass layoffs at the Consumer Financial Protection Bureau, marking a major procedural win for the Bureau’s employee union and a setback for the White House’s efforts to dismantle the agency.
Why it matters: The decision keeps in place an injunction that prevents Acting CFPB Director Russell Vought from firing up to 90% of the Bureau’s workforce while the full court reconsiders the legality of the administration’s plan.
Driving the news:
- In a per curiam order issued yesterday, the D.C. Circuit granted en banc review, vacated the August 15 panel ruling that had sided with the administration, and reinstated the stay blocking layoffs.
- The court set oral arguments for February 24, 2026, and established a fast-tracked briefing schedule running from early January through mid-February.
- The order followed extensive support for rehearing, including amicus filings from 36 members of Congress, 41 nonprofit organizations, and the Constitutional Accountability Center.
The background: The case stems from the Trump administration’s plan to reduce the CFPB’s workforce from roughly 1,600 to about 200 employees, part of what it called a “streamlined” restructuring to focus on banks and mortgage fraud while scaling back oversight of medical debt, student loans, and digital payments. The National Treasury Employees Union sued to block the layoffs, arguing that the administration was unlawfully attempting to dismantle an agency Congress created through the Dodd-Frank Act.
A divided three-judge panel in August had ruled that the district court lacked jurisdiction, but the full bench’s latest order vacates that decision and restores the earlier injunction, effectively freezing the layoffs until the case is reheard.
What they’re saying: Plaintiffs and consumer advocates hailed the full-court review as a pivotal win.
“This is a necessary and timely victory for CFPB workers and the everyday Americans we serve,” said Cat Farman, president of the CFPB union.
“The Bureau’s continued existence is not subject to unilateral presidential edict,” added Jennifer Bennett of Gupta Wessler, which is representing the NTEU.
Sen. Elizabeth Warren [D-Mass.], who helped design the CFPB, called the ruling “good news,” emphasizing that the agency “has returned more than $21 billion directly to Americans scammed by big banks and corporations.”
The funding fight: The CFPB’s future also hinges on an escalating funding dispute. The Trump administration has argued that the Bureau cannot request new transfers from the Federal Reserve because the central bank isn’t operating at a profit; a claim former Fed officials and courts have challenged. A separate lawsuit before Judge Amy Berman Jackson in D.C. will determine whether the CFPB can continue accessing funds through its statutory mechanism.
The bottom line: The en banc decision ensures the CFPB will remain operational into early 2026.
