SCRANTON – The federal Consumer Financial Protection Bureau is fighting an order that would allow one of its former staffers to testify against it in Pennsylvania federal court.
In March, a special master in the CFPB’s case against Navient, the nation’s largest student loan servicer, ruled that economist Xiaoling Ang could testify on behalf of the company because there was no conflict of interest in opposing her former employer’s case.
Special Master Thomas Vanaskie ruled her “sporadic and brief interactions” with CFPB attorneys over two years did not expose her to confidential information. The lawsuit was filed more than a year after Ang left the CFPB.
On April 9, the CFPB objected to Vanaskie’s report, asking Judge Robert Mariani, of the U.S. District Court for the Middle District of Pennsylvania, for help.
“Dr. Ang was indeed exposed to privileged work product on this specific matter while at the Bureau,” the CFPB wrote.
“The fact that she was not a manager and worked in a separate building from Enforcement attorneys cannot negate that she communicated with Enforcement attorneys working on this exact matter, and that those attorneys shared their mental impressions and legal strategies with her so she could have a foundation for advising them on data research.”
In March 2017, Ang published an article on Law360, entitled “Student Loan Repayment Options in Light of CFPB v. Navient.”
That article caught Navient’s attention and the company requested that she prepare an expert report based on her article, to rebut a CFPB expert. Navient’s counsel retained Ang as an expert witness in February 2018, and in November 2019, Navient issued a copy of Dr. Ang’s report to the CFPB.
On Dec. 27, 2019, the Bureau asked the court to disqualify Dr. Ang, and requested other relief for having “switched sides.”
Navient, which is facing accusations it steered students into forbearance instead of encouraging them to move into income-based repayment plans from both the CFPB and Pennsylvania Attorney General Josh Shapiro, says the CFPB is pushing the same “erroneous” argument rejected by Vanaskie.
CFPB documents provided to Ang were ultimately shared with Navient, meaning they are no longer confidential, the company says.
“Dr. Ang’s report relies exclusively on her expertise as an economist and her general knowledge of student loans to analyze information produced in this litigation – including transaction-level data involving ‘millions if not billions of records’ of Navient borrowers,” the company says.
“As the Special Master recognized, Dr. Ang’s episodic interactions with the CFPB attorneys investigating Navient – in which she provided discrete ‘technical advice as to how best to ask for data’ – have nothing to do with the detailed borrower-level analysis that is the basis of her report.”
From the Pennsylvania Record: Reach editor John O’Brien at john.obrien@therecordinc.com.