Shocking Move Sparks Debate: Is 'Judge Shopping' Rigging the System?


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A federal appeals court ruled on Friday that a Texas judge erroneously transferred an industry-backed lawsuit challenging an agency rule on credit card late fees to another court in Washington, D.C., sparking renewed debate over the practice of "judge shopping" in the United States.

The 5th U.S. Circuit of Appeals, located in New Orleans, voted 2-1 in favor of business and banking groups that filed the lawsuit in Fort Worth, Texas.

The federal courthouse in Fort Worth has become a favored venue for litigants contesting the policies of President Joe Biden's administration.

The court's decision was seen as a win for business groups such as the U.S. Chamber of Commerce and American Bankers Association amid a broader discussion on how to address "judge shopping" by litigants who strategically choose courts with sympathetic judges.

The lawsuit challenged a rule by the U.S. Consumer Financial Protection Bureau (CFPB) aimed at reducing what it deemed as "excessive" late fees charged by credit card issuers, which it estimated cost consumers $12 billion annually. 

The rule limits late fees to $8 for issuers with over 1 million accounts, unless they can justify higher fees based on their costs. Previously, issuers could charge up to $30 or $41 for subsequent late payments.

Instead of ruling on the business group's request to block the rule, U.S. District Judge Mark Pittman, appointed by former President Donald Trump, decided last week to transfer the case to a judge in Washington. 

This decision came after the U.S. Judicial Conference announced a new policy to curb "judge shopping" in cases challenging laws.

Before transferring the case, the groups appealed Pittman's earlier decision, effectively stripping him of jurisdiction over the case and his ability to transfer it.

In a Friday opinion, U.S. Circuit Judge Don Willett, joined by U.S. Circuit Judge Andrew Oldham, both appointed by Trump, agreed with the groups. 

They stated that once a party appeals a trial judge's decision, that judge loses jurisdiction to make any changes to the case's status.

U.S. Circuit Judge Stephen Higginson, appointed by former President Barack Obama, dissented, arguing that the ruling limits district court discretion over docket management and policing of forum shopping.

The case has now been transferred to a judge in Washington, over whom the 5th Circuit has no jurisdiction. Willett directed Pittman to inform that judge that his transfer order should be disregarded.

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