Departing from the Ninth Circuit’s decision in Rose v. Chase Bank, N.A., 513 F.3d 1032 (9th Cir. 2008), a California appeals court ruled that a California statutory challenge to a national bank’s “convenience checks” is not preempted by the National Bank Act. In Parks v. MBNA America, N.A., plaintiffs alleged that defendant’s convenience checks violated a California statute – Cal. Civ. Code § 1748.9 – because they did not contain the statutorily-required disclosures. After Rose, defendants moved for judgment on the pleadings on the ground that plaintiffs’ claim was preempted by the National Bank Act. The trial court granted that motion, but the appeals court reversed creating a split of authority with Rose. The appeals court held that the statute was not preempted because, on its face, it did not preclude defendant from exercising its authority to lend. The court left open the possibility that the statute may still be preempted because it significantly impairs the defendant’s authorized activities under the National Bank Act, but concluded that such a determination was premature at the pleadings stage because it depended upon a developed factual record. Click here for Parks v. MBNA America, N.A., No. G040798 (Cal. App. 4th) (May 12, 2010).
Alert May 18, 2010