House Financial Services Committee's Staff Director Kirsten Sutton Mork will leave the committee to join the Consumer Financial Protection Bureau (CFPB) as the agency's chief of staff, a position left vacant after Leandra English was promoted to deputy director on Richard Cordray's last day in charge at the bureau.
English's argument hinges upon the notion that the CFPB was meant to be an independent agency, and cites the 2010 Dodd-Frank Act, which created the agency.
In his written opinion, Judge Kelly said, "The best reading of the two statutes is that Dodd-Frank requires that the deputy director "shall" serve as acting director, but that under the FVRA the president "may" override that default rule".
English, who as deputy director was endorsed to lead the agency by Cordray, is challenging Mulvaney's right to lead the bureau.
Kelly also rejected English's argument that Trump's appointment of a sitting executive branch official as the acting head of the bureau undermined its independence. "Acting Director Mulvaney has been working hard to restore the credibility of this once rogue and politically partisan agency and this work must continue without further obstruction".
Mulvaney has vowed to move the CFPB away from its agenda under Democratic President Barack Obama.More news: Panic as passenger jet skids off runway in Turkey
More news: South Africa wins toss, bats in 2nd test against India
More news: IPL 2018: Total of 1122 players register their name for auction
"Granting English an injunction would not bring about more clarity; it would only serve to muddy the waters", the judge wrote. Under a succession order in the Dodd-Frank Act, English would become acting director once Cordray's resignation took effect.
The decision follows a denial of English's request for a temporary restraining order in November.
The Department of Justice and the CFPB's general counsel have said Trump has broad powers to appoint Mulvaney under the Federal Vacancies Reform Act.
Trump was backed by the Justice Department's Office of Legal Counsel and the CFPB's general counsel, who both issued memos on November 25 concluding that the president had authority to fill the acting director job under the vacancies reform act. The oral arguments on that case were heard on Friday morning.
"We are disappointed in today's decision", Gupta said in a statement.
A spokeswoman for Mulvaney did not immediately respond to a request for comment.