A federal judge on Wednesday denied a request for a preliminary injunction to remove Mick Mulvaney as acting director of the Consumer Financial Protection Bureau.
The judge sided with Mulvaney — President Trump's budget director and choice for the interim position — over Leandra English, the agency's deputy director who has said she is the rightful acting director.
"The court finds that English is not likely to succeed on the merits of her claims, nor is she likely to suffer irreparable harm absent the injunctive relief sought," said Judge Timothy J. Kelly of the U.S. District Court for the District of Columbia in a 46-page decision.
The ruling came after Kelly denied a request by English last month for a temporary restraining order to remove Mulvaney and install her as acting director.
The restraining order decision could not be appealed, so English's attorney, Deepak Gupta, filed for a preliminary injunction. Kelly heard nearly two hours of arguments on the injunction Dec. 22.
The denial of the injunction request by Kelly, a Trump appointee, can be appealed to the U.S. Court of Appeals for the D.C. Circuit.
Gupta said he and English were disappointed in the decision, which hinged on which of two federal laws governed succession at the bureau.
"The law is clear: President Trump may not circumvent the Senate confirmation process by installing his White House budget director to run the CFPB part time," Gupta said Wednesday night in a statement on Twitter. "Mr. Mulvaney's appointment undermines the bureau's independence and threatens its mission to protect American consumers."
Gupta did not say if the ruling would be appealed and did not respond to a request for additional comment. But he had indicated English would appeal, saying previously that "I think everyone understands this court is not the final stop, this judge does not have the final word on what happens in this controversy."
A White House spokesman said Thursday that the judge got the ruling right.
"The administration is glad to see the courts once again recognize the president's lawful designation," said Raj Shah, principal deputy White House press secretary. "The president looks forward to acting director Mulvaney's continued work on behalf of American consumers."
A spokesman for Mulvaney did not immediately respond to a request for comment.
Trump's choice of Mulvaney, an outspoken opponent of the bureau in the past, drew protests from Democrats and consumer advocates.
The dispute began Nov. 24 when Richard Cordray, a Democrat, stepped down as bureau director. He promoted English, his chief of staff, to deputy director and said she would be the acting director under a provision of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act that created the bureau.
Within hours of Cordray's resignation announcement, Trump appointed Mulvaney to fill the post under the Federal Vacancies Act of 1998. The administration said that law allowed Trump to appoint an official who already had been confirmed by the Senate in another capacity to also serve as the bureau's acting director.
Kelly noted in his decision that both sides urged a quick resolution to the uncertainty about the bureau's leadership and said removing Mulvaney, who has been serving as acting director, would not accomplish that.
"There is little question that there is a public interest in clarity here, but it is hard to see how granting English an injunction would bring about more of it," Kelly said.
"The president has designated Mulvaney the CFPB's acting director, the CFPB has recognized him as the acting director, and it is operating with him as the acting director," he said. "Granting English an injunction would not bring about more clarity; it would only serve to muddy the waters."
Mulvaney has moved quickly to put his stamp on the bureau, which writes rules and enforces consumer protections against banks and other financial institutions.
5:20 a.m. Jan. 11: This article was updated with additional comment from Deepak Gupta and White House reaction.
9:30 p.m.: This article was updated with additional detail from the ruling.