Kavanaugh and Home Building: What the Record Shows

Filed in Environmental, Housing Finance, Leadership, Legal by on July 11, 2018 7 Comments

Supreme Court Building in Washington DCAs legal pundits and news outlets pour over Judge Brett Kavanaugh’s extensive judicial record to learn more about President Trump’s new Supreme Court nominee, members need only turn to the multiple NAHB court cases over which Kavanaugh has presided at the U.S. Court of Appeals for the D.C. Circuit to get a fuller picture.

In his 12 years on the D.C. Circuit, Kavanaugh has been involved in eight cases in which NAHB was a petitioner, appellant or amicus. While not always siding with NAHB’s position, Kavanaugh has consistently viewed agency rulemakings with a healthy dose of skepticism.

For example, NAHB was a petitioner in Coalition for Responsible Regulation et al v. EPA, challenging EPA’s attempt to apply an onerous Clean Air Act permitting program to millions of new sources, including some multifamily buildings.

A three-judge panel at the D.C. Circuit upheld EPA’s regulation, and the full D.C. Circuit did as well – except for Judge Kavanaugh. Ultimately, NAHB and its industry coalition took this case to the Supreme Court, which overturned EPA’s regulation for exceeding its statutory authority, just as Kavanaugh had forecast when he declined to go along with the D.C. Circuit’s full court ruling.

Kavanaugh also carefully examines Congress’ actions to ensure they pass constitutional muster. NAHB participated as an amicus in PHH v. Consumer Financial Protection Bureau, a case in which Kavanaugh held that a provision of the Dodd-Frank Act was unconstitutional because it vested too much power in the sole director of the Consumer Financial Protection Bureau (CFPB).

NAHB’s main concern in this case was the CFPB’s re-interpretation of RESPA provisions that affected the use of marketing services agreements, commonly used by builders, real estate agents, lenders and others in the settlement process.

Kavanaugh held that the CFPB could not change its position on RESPA without going through the rulemaking process and making sure the public had a chance to make comments. While the full D.C. Circuit ultimately overturned Kavanaugh’s constitutional holding, it upheld his RESPA holding, which benefits NAHB members significantly.

Judge Kavanaugh’s record of curbing regulatory overreach, as evidenced by these two cases, is one of the key reasons NAHB supports his nomination to the Supreme Court.

For additional information about NAHB legal affairs action, contact Amy Chai.

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  1. Joe Honick says:

    NAHB has every right to applaud a decision that favors our areas of interest. On the other hand, NAHB has no business at all getting into the political morass that can impact a Supreme Court appointment or any other political appointment lest the association endanger its 501c3 status and depart from its industry related function.
    When I was a Staff Vice President , I bought into what turned out to be one of the worst campaign ever: the idea that Fannie Mae should just buy up all those substandard loans to get more money into the mortgage market via mortgage backed securities. Now, and for many years, a Life Director, I can only urge those in association leadership to avoid one more lousy decision and stay out of tis SCOTUS idea unless it wants also to be blamed if Kavanaugh helps to over turn Roe v Wade as well.

    • David Koster says:

      I completely understand Joe’s point. There is certainly some political risk. But not taking risks, or controversial opinions has not served us well over time. Our industry has been under an aggressive assault under both Republican and Democrat administrations. the Obama administration ramped up that regulatory assault to unprecedented levels. Federal judges often legislated from the bench in order to get their desired outcome rather than following the law.

      I don’t know how the current nominee will rule in the future on issues related to our industry, but I’m willing to take the chance on coming out in public support of someone who has a history of pushing back on the administrative state in order to put pressure where needed. Maybe it helps and maybe it doesn’t, but I know my livelihood depends on someone putting the brakes on regulatory overreach and I suspect many NAHB members feel similarly.

      The risk is worth it.

      If not now, when? If not us, who?

      • Susan Monde-roeckle says:

        I agree with Joe. This is a political field NAHB should stay out of. But if David’s thought prevails, surely there is a qualified candidate with a supportive record who does not represent trampling of women’s rights. As a female professional in the building industry for over 40 years I cannot support a candidate who will send us back to 1950.

  2. Mark Marcoplos says:

    I agree that we should be taking a more comprehensive view of the issues that a candidate represents. What good does it do us if a judge makes a few rulings that we agree with while undermining major rights and freedoms?

  3. Kathleen Lowyns says:

    I read with great interest the NAHB article about Judge Kavanaugh, along with the three comments posted to date. I can fully appreciate both Mr. Honick and Mr. Koster’s positions as, while they differ, they clearly address the facts presented in the article. However, there was nothing substantial to support the opinion of Ms. Monde-roeckle so I must interpret her comments as just that – opinion – and I might add a frequently expressed opinion for which I’ve yet to hear or read any factual support. Thanks to the NAHB for their research into Judge Kavanaugh.

  4. Tom Pahl says:

    David Koster predictably hit a set of talking points that mean nothing in the real world. “Regulatory Overreach” is a dog whistle that makes Conservative ears perk up and motivates voters, but it is a much more complex issue than he represents. Perhaph Koster’s comment, “Maybe it helps and maybe it doesn’t…..” is more to the point.

    My experience in the building industry is that, for those who play by the rules, most regulation is adapted by the industry and ultimately adds to net profit. Sure, every added cost incrementally decreases demand, but for every regulation, there are a host of other factors affecting the market. When the economy collapsed in 2007-8 – the worst recession since the Great Depression – it wasn’t regulation that caused it, but UNregulated speculation, indeed outright gambling, with money that was supposed to be safely stored in the mortgage economy. Speculators, with none of their own assets at risk, created a financial house of cards, then took out insurance on that same house of cards. And that’s OK? But it’s not OK for a new consumer protection regulation to be implemented?

    And NAHB wants to play that kind of politics. Bad move.

  5. Philip Herzegovitch says:

    As a holder of two NAHB certifications, I take issue with the NAHB getting itself mixed up in the politics of the SCOTUS appointment process by trying to influence the decision making mechanisms. Creating designations and then marketing them as representations of qualified professionals IS a form a regulation. Regulations are nothing more than The Rules of Play. Thanks to regulation imposed upon the building industry, with that said industry kicking and screaming the entire way like a petulant child refusing to eat its peas and carrots, our industry is safer and the consumers more empowered than ever. If the NAHB really wants to “help” our industry, and the country in general, it would be better for them to work towards getting contractors not playing by the rules REMOVED from our industry rather than trying to influence a SCOTUS approval. Also, NAHB needs to be acutely aware of attaching itself to any one person that has the potential to set back women’s rights 60+ years. At a time when we are trying to attract more women to the construction trades, it would not be a very smart move to alienate those very same women by hitching our wagon to this particular horse. Be careful what you wish for. 😉

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