When Dodd-Frank was passed, the Democrats had control of Congress, the White House, and the SEC. Despite that preponderance, Leviathan moved ever so slowly. As a result, seven years after Dodd-Frank became law there are a slew of rule making requirements imposed by the statute that remain unfulfilled.
Now, of course, the GOP controls the White House, Congress, and the SEC. The new Wall Street cops clearly have a deregulatory focus. But can they just ignore the Dodd-Frank requirements?
Bloomberg reports that the GOP is ignoring a number of Dodd-Frank regulatory mandates. Assuming Congress doesn't try twisting the SEC's arm, could a private party sue to compel the SEC to initiate the required rule making proceedings?
As I understand that law, the general rule is that "private parties have “no right to compel the agency to hold rulemaking proceedings." Prof'l Drivers Council v. Bureau of Motor Carrier Safety, 706 F.2d 1216, 1223 (D.C.Cir.1983). See also WWHT, Inc. v. FCC, 656 F.2d 807, 818 (D.C.Cir.1981) (“It is only in the rarest and most compelling of circumstances that this court has acted to overturn an agency judgment not to institute rulemaking.”).
On the other hand, at least one court has seen fit to grant an order compelling the SEC to initiate a rule making under Dodd-Frank:
Section 1504 of Dodd-Frank amends the Securities Exchange Act of 1934 to require “publicly traded oil, gas, and mining companies,” or “resource extraction issuers,” to disclose payments made to foreign governments or the federal government for the commercial development of oil, natural gas or minerals. D. 18 at 4. Under Dodd-Frank, these disclosures must be made in annual reports to the SEC. Id. Section 1504 requires the SEC to issue a rule implementing the new disclosure requirements. Id. Specifically, Section 1504 provides that:Not later than 270 days after the date of enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Commission shall issue final rules that require each resource extraction issuer to include in an annual report of the resource extraction issuer information relating to any payment made by the resource extraction issuer, a subsidiary of the resource extraction issuer, or an entity under the control of the resource extraction issuer to a foreign government or the Federal Government for the purpose of the commercial development of oil, natural gas, or minerals ....*171 Id. (quoting 15 U.S.C. § 78m(q)(2)(A)) (emphasis omitted). As such, the SEC's statutory deadline for promulgating a final disclosure rule was April 17, 2011. Id. at 5.
Oxfam Am., Inc. v. United States Sec. & Exch. Comm'n, 126 F. Supp. 3d 168, 170–71 (D. Mass. 2015).
By the time the case got before the First Circuit, the SEC was in default by over a year even though it had gotten two 270 day periods to complete the rule.
The court held that because Congress had set a date-certain deadline for the issuance of the final regulation, the court had no discretion to delay the mandatory duty imposed. Accordingly, it issued an order compelling the SEC to act. See South Carolina v. United States, No. 1:16-CV-00391-JMC, 2017 WL 1053844, at *9 (D.S.C. Mar. 20, 2017) (holding that "a few courts have agreed with Forest Guardians' conclusion that when an agency action is “unlawfully withheld” under § 706(1), a reviewing court has no equitable discretion to deny an order compelling the action").
The key factor may be whether the statute in question contains both a rule making mandate AND a date-certain deadline by which the rule must be adopted. See Cobell v. Norton, 240 F.3d 1081, 1096 (D.C. Cir. 2001) ("The D.C. Circuit, confronting a case in which an agency had unreasonably delayed an action under a statute that provided no deadline (rather than and [sic] agency that unlawfully withheld an action under a statute that imposed a deadline), explained that 'a finding that delay is unreasonable does not, alone, justify judicial intervention’”).
