Wednesday, September 21, 2011
Federal Court Rules Dodd-Frank Did Not Alter Federal Preemption Standard
A federal judge (SD Iowa) has ruled that the Dodd-Frank Act did not raise the standard for National Bank Act preemption of state law. The Dodd-Frank Act adopts the same standard curently applied by the federal courts that state consumer financial laws are preempted, only if in accordance with the legal standard for preemption in the decision of the Supreme Court in Barnet Bank that the State consumer financial law prevents or significantly interferes with the exercise by the national bank of its powers. Thus, the Dodd-Frank Act did not materially alter the standard for preemption the court must apply in a case involving federal preemption of the Iowa Electronic Transfer of Funds Act. US Bank National Assoc. v. Schipper US District Court, Southern District of Iowa.