O'Neal v. Capital One Auto Finance, Inc.
3:10-cv-00040
N.D.W. Va.Sep 29, 2011Background
- Plaintiffs allege COAF violated WVCCPA by contacting Mr. O’Neal after he stated he was represented by counsel; between Nov 11 and Dec 30, 2009 COAF made 77 calls despite attorney information being provided; the attorney contact details were provided on multiple occasions.
- Plaintiffs filed suit April 8, 2010 asserting a WVCCPA § 46A-2-128(e) claim and seeking relief for debt-collection communications.
- Defendant moved June 10, 2011 for judgment on the pleadings arguing § 128(e) is preempted by the National Bank Act (NBA) and OCC regulation 12 C.F.R. § 7.4008.
- Court rejected preemption arguments, concluding NBA preemption does not apply to state debt-collection laws of general applicability.
- Court stated 7.4008 does not preempt state debt-collection laws and that Frye and Lomax are not controlling, applying obstacle preemption analysis to WVCCPA § 128(e).
- Conclusion: COAF’s partial motion for judgment on the pleadings is denied; § 128(e) is not preempted by the NBA as applied to this case.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is WVCCPA § 46A-2-128(e) preempted by the NBA and OCC rule 7.4008? | O’Neal argues no obstacle/preemption; state law protects consumers. | COAF contends NBA preempts § 128(e) under 12 C.F.R. § 7.4008. | No preemption; § 128(e) not preempted. |
| What is the proper NBA preemption standard to apply to state consumer protection laws? | Plaintiffs rely on traditional state-law police-power preservation. | COAF urges standard from Frye/Lomax favoring preemption via OCC rule. | Adopted obstacle preemption framework; not field/express preemption. |
| Does § 7.4008 preempt state debt-collection laws of general applicability? | Laws like § 128(e) are not among the restricted areas; saved under § 7.4008(e)(4). | § 7.4008(d) preempts state laws obstructing non-real estate lending powers. | § 7.4008 does not preempt § 128(e); not applicable here. |
| Does obstacle preemption apply given facts in this case? | Section 128(e) applies to this case as a general consumer-protection measure. | Section 128(e) would significantly interfere with COAF’s debt-collection powers. | No significant interference; § 128(e) not obstacle-preempted. |
Key Cases Cited
- Wyeth v. Levine, 555 U.S. 555 (U.S. 2009) (presumption against preemption applies; Congress’s purpose governs)
- Watters v. Wachovia Bank, N.A., 550 U.S. 1 (U.S. 2007) (national banks subject to state laws of general applicability)
- Cuomo v. Clearing House Ass’n, L.L.C., 129 S. Ct. 2710 (S. Ct. 2009) (plain terms of NBA; preemption analysis not driven by presumption)
- Barnett Bank of Marion County, N.A. v. Nelson, 517 U.S. 25 (U.S. 1996) (conflict/obstacle preemption framework)
- College Loan Corp. v. SLM Corp., 396 F.3d 588 (4th Cir. 2005) (three types of preemption; no express preemption here)
- H&R Block E. Enters., Inc. v. Raskin, 591 F.3d 718 (4th Cir. 2010) (preemption analysis under NBA context; obstacle/field distinctions)
- Monroe Retail, Inc. v. RBS Citizens, N.A., 589 F.3d 274 (6th Cir. 2009) (state debt-collection laws saved by § 7.4008(e))
- Frye v. Bank of America, N.A., 2010 WL 3244879 (N.D. W. Va. 2010) (cited as preemption authority (overruled for current analysis))
- Lomax v. Bank of America, N.A., 435 B.R. 362 (N.D. W. Va. 2010) (bankruptcy context preemption analysis (overruled))
- Aguayo v. U.S. Bank, — F.3d — (2011) (cited re: savings clause interpretation)