National Bank Act

News & Analysis as of

Update: Midland Funding v. Madden

In an amicus curiae brief, the US Solicitor General recommends that the petition for certiorari in Madden be denied, but agrees that the Second Circuit’s decision is incorrect and emphasizes the importance of banks being able...more

Financial Services Weekly News - May 2016 #4

Breaking News - Solicitor General Files Brief in Madden v. Midland Funding - On May 24, the U.S Solicitor General (SG) filed a brief with the U.S. Supreme Court (the Court) in the matter of Madden v. Midland...more

Justice Department Sides With Financial Industry on Madden Case

Marketplace loan investors may want to "gather ye discounted Madden loans while ye may," as the Robert Herrick poem reads (taking some fintech license, of course). In the strongest rebuke yet of the U.S. Court of Appeals...more

Case Update: Midland Funding v. Madden: The Solicitor General Brief Could Be a Game Changer

In response to a request of the U.S. Supreme Court (discussed here), the U.S. Solicitor General’s Office on Tuesday filed a brief with the Court expressing the U.S. Government’s views on the merits of the claims brought in...more

The Solicitor General Weighs in on Madden v. Midland

The Solicitor General’s brief argues the Second Circuit’s holding was incorrect, but does not recommend a grant of certiorari. On May 24, the U.S. Solicitor General and the Office of the Comptroller of the Currency (OCC)...more

UPDATE: Supreme Court Asks Solicitor General to Weigh In on Madden Case

The Supreme Court released the results of its March 18 status conference in the Madden v. Midland case. The Court determined that it would like to see a brief from the U.S. Solicitor General (SG). The SG is the official...more

Federal Court in New York Dismisses State-Law Claims Against National Bank and Service Provider on Preemption Grounds

On March 9, the U.S. District Court for the Southern District of New York upheld the preemption of state-law claims brought against a national bank and its non-bank servicer provider. Edwards v. Macy’s Inc., No. 14-cv-8616...more

Madden Update – Petition Request Bodes Well for High Court Review but Raises New Questions

The US Supreme Court’s recent request for an opinion from the US Solicitor General to help inform the Court’s decision on whether to review the Second Circuit’s decision in Madden v. Midland Funding, LLC indicates that the...more

Southern District of New York Weighs In on Preemption Under the Dodd-Frank Act

In Edwards v. Macy’s, Inc., — F. Supp. 3d —, 2016 WL 922221 (S.D.N.Y. Mar. 9, 2016), the U.S. District Court for the Southern District of New York recently held that state law claims arising from plaintiff’s enrollment in a...more

Case Update: Midland Funding v. Madden

The U.S. Supreme Court on Monday issued an order inviting the Solicitor General to provide the views of the United States on whether the Court should grant Midland Funding’s petition seeking review. As discussed in greater...more

Madden Tells SCOTUS That Marketplace Lenders Should Not Worry About Madden

As the Marketplace Lending (MPL) industry gears up for the upcoming conference trifecta – ABS Vegas, AltFi Europe and LendIt USA 2016, the effect of the Midland Funding, LLC et al. v. Saliha Madden case and its pending appeal...more

Update on Madden v. Midland: Cert. Decision Expected Soon

The certiorari petition asks the court to address whether the National Bank Act continues to have preemptive effect after the national bank has sold or otherwise assigned a loan to another entity. In a petition for a...more

U.S. Supreme Court Asked to Decide Whether National Bank Act Preemption of State Usury Laws Applies to Loans Transferred to...

The defendants in Madden v. Midland Funding, LLC have filed a petition for certiorari with the U.S. Supreme Court, asking the Court to decide whether the preemption of state usury laws under Section 85 of the National Bank...more

Case Update: Madden v. Midland Funding

As expected, today, November 10, 2015, Midland Funding filed a petition for a writ of certiorari in the United States Supreme Court, asking the Court to review the Second Circuit’s ruling in Madden v. Midland Funding, that...more

Orrick's Financial Industry Week in Review

Case Update: Madden v. Midland Funding - ?On May 22, 2015, the U.S. Court of Appeals for the Second Circuit held in Madden v. Midland Funding that the federal preemption provision of the National Bank Act, 12 U.S.C. §...more

Case Update: Madden v. Midland Funding

On May 22, 2015, the U.S. Court of Appeals for the Second Circuit held in Madden v. Midland Funding that the federal preemption provision of the National Bank Act, 12 U.S.C. § 85, could not be invoked by a non-national bank...more

The Second Circuit Denies Midland’s Request For Rehearing On Its Decision That Upended Longstanding Principles of Lending Law

On August 12, 2015, the United States Court of Appeals for the Second Circuit denied Midland Funding, LLC and Midland Credit Management (collectively, “Midland”)’s petition for panel rehearing, or, in the alternative,...more

District Court Invalidates NYC Ordinance Making Banks Service Under-Served Areas as Requirement to Receive Municipal Deposits

On August 7, the U.S. District Court for the Southern District of New York granted summary judgment for the New York Bankers Association (NYBA) in a case challenging the City of New York’s Local Law 38, entitled the...more

Second Circuit Denies Request for Rehearing in Madden v. Midland Funding Case

In a case closely watched by the lending industry, on August 12, 2015, the U.S. Second Circuit Court of Appeals denied a request by Midland Funding, LLC (Midland Funding) to rehear a case decided in May (Madden v. Midland...more

Special Alert: Second Circuit Will Not Rehear Madden Decision That Threatens to Upset Secondary Credit Markets

Two months ago we issued a Special Alert regarding the decision of the Court of Appeals for the Second Circuit in Madden v. Midland Funding, LLC, which held that a nonbank entity taking assignment of debts originated by a...more

Treasury Request for Public Input on Expanding Access to Credit through Online Marketplace Lending

On July 20, the Department of the Treasury published a Notice and Request for Information (“RFI”) seeking comment on various aspects of online marketplace lending, including – - the business models and products offered...more

Increased Risk for Buyers of Credit Card Loans

Third party debt buyers may face increased threat of state-law class action lawsuits after a recent Second Circuit ruling prohibiting such debt buyers from invoking federal preemption defenses under the National Bank Act to...more

Madden v. Midland Funding, LLC

On May 22, the Second Circuit Court of Appeals ruled that when a nonbank entity purchases loans from a national bank, the interest rate the nonbank entity may charge is limited to the rate of interest of the state of...more

Valid at Inception Rule Shot Down by the Second Circuit

Marketplace lenders and investors that purchase interests in loans originated by banks should pay close attention as it could spawn a host of class action lawsuits if left standing. In a controversial opinion decided on...more

NBA Doesn’t Preempt State Usury Claims Against Assignee of National Bank, Second Circuit Rule

Why it matters - In a potentially troubling ruling, the Second Circuit Court of Appeals refused to find the National Bank Act (NBA) preempted state law usury claims against an assignee of a national bank. In a putative...more

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