Frank: Healthcare ruling an ill omen for legal challenge to Dodd-Frank

Earlier in June, the Competitive Enterprise Institute and the 60 Plus Association joined the State National Bank of Big Spring, Texas, in filing suit alleging that Dodd-Frank, and in particular the Consumer Financial Protection Bureau (CFPB), violated the Constitution and handed unchecked power to government regulators.

The lawsuit singles out the president's controversial recess appointment of the CFPB's first director, Richard Cordray. After Cordray's nomination was blocked by Senate Republicans, the president used his recess appointment powers to install him as head of the bureau, despite the fact that Republicans had kept Congress in brief pro forma sessions specifically to block such appointments. The White House argued that the sessions, which last just a few moments, do not constitute serious work and can be ignored for the purpose of recess appointments.

The suit also challenges the constitutionality of another regulator panel created by the law, the Financial Stability Oversight Council.

But Frank said he was not losing any sleep over the legal challenge to his landmark law, calling it "one of the worst irresponsible lawsuits I've ever seen." He pointed out that many of the complaints about the CFPB in the suit are also true of another long-standing financial regulator, the Office of the Comptroller of the Currency.

"The question there is not whether it's going to succeed but whether or not [Gray] will be sanctioned for a frivolous lawsuit," he said. "That was the work of a hack with a law license, not a lawyer."