On September 14, U.S. District Court for the Eastern District of Kentucky granted a motion brought by the Kentucky Bankers Association (KBA) and eight Kentucky-based banks (plaintiffs), seeking a preliminary injunction enjoining the CFPB from enforcing the Small Business Lending Rule (the Rule) against the plaintiffs and their members. In granting the motion, the court agreed to halt the rule until the Supreme Court rules on the CFPB’s funding structure in Consumer Financial Protection Bureau et al. v. Community Financial Services Association of America Ltd. The court also noted that the banks are incurring expenses related to “training programs, seminar fees, staff time, and new software” to comply with the ule, which they cannot recover due to the federal government’s sovereign immunity and “are likely unrecoverable, resulting in irreparable harm to plaintiffs.”
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