Recently, the U.S. District Court for the Eastern District of Missouri denied a motion to dismiss filed by a mortgage servicer (the defendant) which argued that the plaintiff’s claims were not cognizable after the Loper Bright decision because they depended on regulatory interpretation rather than statutory authority. The plaintiff, an individual, asserted three counts against the mortgage servicer for violations of RESPA and one count for a violation of TILA. The mortgage servicer argued the three RESPA counts invoked administrative regulations and thus were not “cognizable” following the U.S. Supreme Court’s recent decision in Loper Bright Enterprises v. Raimondo. While the court agreed that “a regulation cannot create a right that Congress has not,” the court held that the plaintiff’s claims were “firmly rooted in the statute” and were not under statutory interpretation. The court denied the motion to dismiss, allowing the claims to proceed.
The court reasoned that RESPA’s statutory text authorized the CFPB to “fill up the details” to protect consumers from abusive practices. RESPA’s statutory framework supported the CFPB’s regulations that the plaintiff invoked in his claims, reinforcing the court’s decision to deny the motion to dismiss.
