Hawaii Ex Rel. Louie v. HSBC Bank Nevada, N.A.
2014 U.S. App. LEXIS 14966
9th Cir.2014Background
- Hawaii AG filed complaints in state court against six credit card providers for deceptive marketing and enrollment in add-on products.
- Defendants removed the cases to federal court and the AG moved to remand.
- The district court held CAFA did not jurisdiction, but found at least one claim completely preempted by the National Bank Act and exercised jurisdiction over other claims.
- The district court determined complete preemption over some claims against nationally chartered banks; it declined to remand all claims and exercised supplemental jurisdiction over remaining claims.
- The AG sought interlocutory appeal under 28 U.S.C. §1292(b), and this court granted review; the panel reversed, holding no federal jurisdiction and remanding to state court.
- The Ninth Circuit ultimately held the complaints unambiguously disclaimed class action status, so CAFA did not apply and remand was proper.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CAFA jurisdiction applies when no class action is pled. | Attorney General contends no CAFA jurisdiction because class status is disclaimed. | Card providers argue CAFA applies if action is brought under a state class action mechanism. | CAFA jurisdiction does not attach; claims remain non-class actions. |
| Whether the district court had subject-matter jurisdiction under complete preemption. | AG argued no preemption since claims did not challenge interest rates. | Card providers contended NBAs complete preemption of rate-of-interest claims. | Complete preemption did not apply; claims were independent state-law obligations. |
| Whether payment-protection plan fees constitute interest under NBAs §85. | AG alleged fees charged as part of credit extensions; may invoke preemption. | Fees may be considered interest or not; district court should decide. | Even if considered interest, the claims did not allege usury; not completely preempted. |
| Whether the complaints plead a class action by operation of Hawaii law under §480-14(b). | AG invoked parens patriae authority and enforcement, not a class action. | §480-14(b) brings actions as parens patriae class actions. | Complaints unambiguously disclaimed class status; not removable under CAFA. |
Key Cases Cited
- Beneficial Nat’l Bank v. Anderson, 539 U.S. 1 (2003) (complete preemption of state usury laws; federal remedy for overcharges)
- Davila v. E.F. Hutton & Co., 542 U.S. 200 (2004) (plan documents may establish complete preemption; preemption limited by substance)
- Purdue Pharma L.P. v. Kentucky, 704 F.3d 208 (2d Cir. 2013) (CAFA jurisdiction if action filed under state class-action rule similar to Rule 23)
- AU Optronics Corp. v. Kent, 134 S. Ct. 1345 (2013) (CAFA mass action and preemption guidance; avoid transforming pleadings from state law)