OAKLAND – California Attorney General Rob Bonta today filed an amicus brief in support of local prosecutors’ authority to enforce state consumer protection laws against national banks. In People v. Credit One, Credit One Bank filed a lawsuit in federal court seeking to throw out a lawsuit filed in California state court by the District Attorneys of Riverside, San Diego, Los Angeles, and Santa Clara. The district attorneys allege violations of California’s Unfair Competition Law relating to illegal debt collection practices. In today’s brief, Attorney General Bonta urges the Ninth Circuit to uphold the district court’s ruling in the district attorneys’ favor. The district court dismissed Credit One’s federal challenge to the district attorneys’ state court case. The brief argues that local prosecutors have a well-established right to sue national banks in state court to enforce state consumer protection laws, so long as those laws are not preempted by the National Bank Act.
“If you break the law in California, local prosecutors have the authority and the responsibility to hold you accountable,” said Attorney General Bonta. “We’re not going to give banks a get-out-of-jail-free card just because of their charter status. Credit One engaged in illegal debt collection practices, and they can’t hide behind a misinterpretation of federal law to escape accountability here. At the California Department of Justice, we’re working tirelessly to hold corporations accountable, and we’re standing up for our local partners' ability to do the same.”
In March 2021, the District Attorneys of Riverside, San Diego, Los Angeles, and Santa Clara filed a lawsuit against Credit One, alleging that the bank engaged in harassing debt collection practices illegal under the Rosenthal Fair Debt Collection Practices Act. Credit One has challenged the district attorneys’ right to sue a national bank in state court for violations of state consumer protection laws. The district court ruled in the district attorneys’ favor, and Credit One subsequently appealed.
In today’s brief, Attorney General Bonta argues that the Ninth Circuit should affirm the district court’s decision because local prosecutors have a well-established right to sue a national bank in state court for violations of state law, so long as those laws are not preempted by the National Bank Act or other federal laws regulating national banks. The Attorney General also argues that this enforcement authority, affirmed by the Supreme Court in Cuomo v. Clearing House Association, is not limited to state attorneys general, but includes district attorneys and other local law enforcement as well.
A copy of the brief is available here.