Justia Banking Opinion Summaries

Plaintiff appealed the district court's grant of defendant's motion to dismiss where plaintiff claimed that defendant violated a section of California's Rees-Levering Act (Act), Cal. Civ. Code 2983.2(a), which required a car loan lender to provide certain post-repossession notices to a defaulting borrower prior to selling the repossessed car. At issue was whether the Act's notice requirements were preempted by the National Bank Act (NBA), 12 C.F.R. 7.4008, and its regulations. The court held that because the Act sections at issue were directed toward debt collection and were therefore not preempted by the NBA, the court reversed the judgment of the district court and remanded for further proceedings.

This criminal appeal arose from a "finite reinsurance" transaction between American International Group, Inc. (AIG) and General Reinsurance Corporation (Gen Re). Defendants, four executives of Gen Re and one of AIG, appealed from judgments convicting them of conspiracy, mail fraud, securities fraud, and making false statements to the Securities and Exchange Commission. Defendants appealed on a variety of grounds, some in common and others specific to each defendant, ranging from evidentiary challenges to serious allegations of widespread prosecutorial misconduct. Most of the arguments were without merit, but defendants' convictions must be vacated because the district court abused its discretion by admitting the stock-price data and issued a jury instruction that directed the verdict on causation.

Petitioners appealed from a Memorandum and Order and Final Order of Forfeiture entered by the district court dismissing their petition for an ancillary hearing and rejecting their claim as beneficiaries of a putative constructive trust in defendant's forfeiture assets. At issue was whether the remission provision of 21 U.S.C. 853(i) precluded the imposition of a constructive trust in petitioners' favor and whether imposing a constructive trust would be consistent with a forfeiture statutory scheme provided by section 853. Because the court concluded that section 853(i) did not preclude, as a matter of law, recognizing a constructive trust and because a constructive trust was not inconsistent with the forfeiture statute, the court vacated the Final Order of Forfeiture and remanded the case to the district court to consider whether, pursuant to Vermont law, a constructive trust should be recognized in favor of petitioners.

TCF National Bank (TCF) sued to enjoin a portion of the Dodd-Frank Wall Street Reform Act (Act) of 2010, Pub. L. No. 111-203, 124 Stat. 1376, that would limit the rate some financial institutions could charge for processing debit-card transactions. Section 1075 of the Act, the Durbin Amendment, amended the Electronic Fund Transfer Act, 15 U.S.C. 1693, et seq., by adding several provisions regarding debit-card interchange fees. TCF alleged that section 1693o-2(a)(2), (a)(4), and (a)(6) of the Act were facially unconstitutional because these provisions would require the Board of Governors of the Federal Reserve Board (Board) to set an interchange rate below the cost of providing debit-card services. TCF also alleged that these provisions arbitrarily exempted smaller issuers from the Board's rate regulations and thus violated TCF's due process and equal-protection rights under the Fifth Amendment. The court held that the challenged provisions in the Durbin Amendment survived rational basis review where "Congress's decision to link interchange fees to issuing banks' actual costs was reasonably related to proper legislative purposes: (1) to ensure that such fees were reasonable and (2) to prevent retailers and consumers from having to bear a disproportionate amount of costs of the debit card system." The court also held that the Durbin Amendment's distinction between larger and smaller issuers of debit-cards was rationally related to the government's legitimate interests in protecting smaller banks, which did not enjoy the competitive advantage of their larger counterparts and which provided valuable diversity in the financial industry. Therefore, the court held that TCF was not likely to prevail on its equal-protection argument. Accordingly, the court affirmed the district court's denial of TCF's motion for a preliminary injunction.