*1 contrary that are provisions (policy of the reading supports also 357.1 if approved even are void coverage code on insurance a floor code, it also sets in Director). policies Reading the accident in by the provided be must that law, ILCS beneficiaries 5/357.1 See policies. conformity with health provi- policy health loss (titled “Accident unless to recover entitled were language in stating required” intoxi- sions decedents’ of the consequence awas provisions 357.14 section identical litigated. be remains issue That cation. substi- insurer unless required that are not ap- court district Finally, the favorable less is not that language tutes considered separately to have pear by the Di- approved that the insured Act Fraud Consumer Illinois plaintiffs’ rector). on judgment summary claim, granting is bol- Moreover, consider decline We case. provi- whole other of the reading some by stered Be- appeal. on 357.25, instance first in the through claim 357.15 sections in sions for a the claim are of Many and remand reverse provisions. cause model may consider substantive considered benefits, the district that would type seriously Penney could on remand. nature, and claim Act in Fraud the Consumer change these it could argue AND REMANDED. REVERSED approv- Director’s obtaining the by simply provides 357.18 section example, al. For coverage has when insured insurers, lia- different from two loss same Pen- basis. rata proa shared on bility is maintain pressed hard ney would if the liability all disclaim it could simply policy another had insured to state language policy changing in the zero always was Asso Utah, ONE, rata share National pro BANK Pen- could coverage. Nor Plaintiff/Appellant, of double event ciation, length shorten approval ney obtain policy cancel required of notice to 10 357.22 section required days ca GUTTAU, official in his K. Michael espe- provisions, Such example. days, Superintendent pacity as less “not by the accompanied cially when Electronic Administrator 357.14, are section language favorable” Funds, Division Transfer level of on a floor to set clearly meant of Com Department Banking, kinds in these coverage provided to be Defendant/Appellee. merce, policies. Currency, Comptroller of the III. Plaintiff/Amici Intervenor authorized was Director Appellant, on behalf less that were policies approve statute mandato insured favorable Association; Cash Bankers Consumer through 357.15 sections ry provisions N.A.; NationsBank, Inc.; Station, ap Director The fact 357.25. McCook, Ne National is there issue policy Penney proved N.A.; Iowa, braska; Norwest Farm v. State Bertini irrelevant. fore Corporation, Bancorp; Firstar 851, 6 Co., Ill.App.3d Ins. Auto. Mutual Appellant, behalf (1977) Amici 1355, 1358 N.E.2d Ill.Dec. provision particular ways certain make inapplica- through 357.25 357.15 sections with the inconsistent to or inapplicable was type of particular awith to or inconsistent ble approval under then seek code model reading render contrary policy. A 357.26. section al- could an insurer tautology, for section *2 Association; Bankers Iowa Inde pendent Association; Bankers Credit League, Union Amici on behal f Appellee.
No. 98-3166.
United States Court of Appeals,
Eighth Circuit.
Submitted: Jan. 1999.
Filed: Sept.
Rehearing Rehearing Denied
Nov. 1999.* * Judge Judge Loken grant Hansen would part took no in the consideration or decision petition. Judge Sheppard Morris Arnold of this case. *3 DC, Jr., Washington, Long, A.
Robert Friedman, DonW. (Andrew C. argued Bennett, Andrew Alan Brittin, Jr., Steven Neidenthal, on Sutter, C. Randall I. Bank One. brief), appellant, for DC, ar- Jordan, Washington, B. Douglas Serino, L. Natter, Robert (Raymond gued on brief), amici for Griffin, on Robert appellant. behalf Moines, Anderson, Des Richard Andrew D. Miller, (Thomas Pamela J. IA, argued brief), Senneff, on Griebel, G. Donald Guttau. appellee IA, Moines, McLean, Des Johnson Julie brief), Gamble, on (Robert A. argued appellee. on behalf for amici ARNOLD, S. RICHARD BEFORE: WOLLMAN,1 Circuit BRIGHT, and Judges. Judge.
WOLLMAN, Chief One) (Bank ap- Utah, One, N.A. aof court’s denial the district peals preliminary April 1999. Eighth Circuit Judge of Chief became Roger Wollman L. Appeals for the States Court United (the State) from enforc- II. ing Iowa statutes restricting Bank One’s Although Bank One’s motion operation of automated teller machines asked preliminary injunction, we (ATMs). Because find that certain may consider it as a motion for a perma provisions of Electronic Funds injunction. nent See generally Minnesota (EFTA), Transfer Act Iowa Code ch. Dep’t Econ. v. Riley, 107 are preempted by section 36 of the Nation- (8th Cir.1997) (reviewing a district court al (NBA), Bank Act §§ 21-216d, U.S.C. grant of a preliminary injunction and we reverse the district court’s order and granting a permanent injunction because remand for entry of a *4 all issues questions law). were Be junction prohibiting enforcement of the cause Bank One and the disagree State relevant sections. only on questions law, nothing remains for the district court to resolve regarding
I. the underlying facts. Accordingly, we must determine whether a permanent in a One is national bank organized junction appropriate. under the NBA. Its main office is located in Salt Utah, Lake City, and it has no In determining whether a pre branch 1997, offices Iowa. In Bank One liminary injunction should issued, be a dis twenty-four installed ATMs at retail store trict court must take into account the Iowa, locations in including eleven at threat of irreparable harm to movant, the Sears, (Sears) Roebuck & Co. stores the balance between this harm and the throughout the state. harm to the other if party injunction the granted, probability the 1997, October of movant’s suc the Iowa Superin- merits, cess on the tendent public interest. ordered Sears to cease See operation Dataphase Systems, ATMs, of the Inc. v. C.L. Sys citing multiple vio- tems, Inc., 109, 113 (8th 640 Cir.1981) lations of F.2d the Iowa EFTA. On December (en banc). 26, The 1997, standard granting State filed action a in state permanent injunction essentially Sears to the opera- same as for a preliminary injunction, tion of the ATMs and to ex a assess fine. As cept that to result, obtain a Sears instructed Bank toOne the movant must attain remove all of its success ATMs on the from Sears stores merits. in Iowa. Prod. Amoco v. One Co. complied Village with Sears’s Gambell, Alaska, request 531, 480 placed 546 n. the ATMs in storage 107 S.Ct. (1987). 94 pending the outcome of L.Ed.2d 542 litigation. Bank One filed suit in court, district Although we have said that seeking a declaration that provisions of the four Dataphase factors are applicable in Iowa EFTA restricting out-of-state banks cases involving permanent injunctions, see, from operating ATMs within Iowa e.g., Randolph v. Rodgers, 170 F.3d preempted by the NBA (8th and praying for Cir.1999); Layton Elder, the issuance of a preliminary and perma- (8th Cir.1998); Fogie v. nent injunction. Bank complaint One’s Americas, THORN Inc., 95 F.3d also alleged (8th the restrictions violate Cir.1996), we conclude that the bal provisions several of the United States ance-of-harm and public-interest factors Constitution. The district court denied need not taken be into account in a situa Bank One’s motion for a preliminary in- such tion as that which exists in pres junction, finding that the challenged provi- ent case. If proves Bank One sions of Iowa law were not preempted and relevant provisions of the Iowa EFT are concluding that Bank One was unlikely to preempted by the NBA and that it will succeed any of its constitutional claims. irreparable suffer harm if the State is not Howev- institutions. of financial group provisions, enforcing those enjoined sign bear shall terminal er, satellite harm the question
then inches three larger drop from no or label interest public of the matter name, ad- identifying entitled will be One two inches case, for Bank of the harm number telephone what matter dress, no relief injunctive will interest The ad- public State, terminal. and the the satellite owner the en- enjoining methods of served authorize perforce ministrator provisions deems invalid of the administrator forcement identification public general law. to enable necessary satel- accessibility of a to determine A. terminal. lite several contains The Iowa 527.5(5). §Id. placement relevant au state. grants within operation pow an in-state incidental contains such “all things, to exercise thority Among carry on establishment necessary for the requirement office shall ers as *5 Bank Nat'l banking.” ATMs: of of business (8th 775, estab- not 777 shall F.2d terminal Taylor, 907 satellite v. A E. Ark. fi- by a except (Sev § state 24 Cir.1990) within 12 U.S.C. lished (quoting place principal whose NBA institution the argues nancial enth)). One Bank state, one in this is located of of business placement the authorizes implicitly in licensed location business has a which the states. restriction without ATMs 536A, or one chapter under state EFTA, it ar Iowa the of state in this located office has an which bank a ability of impair gues, requirements meets which and there to advertise and ATMs place its 4. subsection on. 527.4(4), § 527.4(1) (citing id. § Iowa Code oper- enumerated restrictions “[Gjrants various of both sets which including banks, na- ATMs). All to national ation ‘powers’ incidental informational an banks, file must lim normally tional authority not grants [are] Superintendent Iowa with statement ordinarily preempting, rather by, but ited administrator) stating the (the v. Nel Barnett law.” contrary state of the business, location of the name 1108, 1103, 134 25, 116 S.Ct. son, 517 U.S. charges, required terminal, a schedule law state (1996). Where 237 L.Ed.2d main- will bank agreement an accomplish an obstacle “as stands with compliance in terminal tain purposes full of the execution ment 527.5(3). If the id. See EFTA. may be Congress,” objectives respond to administrator (quot Id. 1108 at preempted. to be found days of thirty within statement formational Davidowitz, 312 U.S. ing Hines is statement informational filing, (1941)). State 581 L.Ed. 85 S.Ct. 61 approved. expressly been to have deemed however, preempted, regulations 527.5(7). §id. See grant a “accompanies] Congress when office in-state In addition state explicit an with power explicit an the Iowa requirements, approval power of that exercise ment placed may be advertising limits at Id. S.Ct. 116 law.” state subject provides: It ATM. on an establish predicated Congress shall this state in terminal A satellite com upon branches bank ment each identifying label sign or bear 12 See regulations. state with pliance utilizing the institution financial type to de Therefore, in order 36(c). U.S.C. location terminal A satellite terminal. preempts NBA termine whether adver- used to not be shall determine must regulations, aor institutions financial tise individual
849
an
whether
is a
ATM
“branch” as defined sources
productive
activities, such as
in section 36.
loans,
making
rather
to compliance
unnecessary
with
regulations.”
Id.
amended section 36
“Sec-
to.
read,
tion [36(j)J clarifies
‘branch’,
“[t]he term
that an
as used
‘ATM’
in this
or ‘re-
section, does not
mote
include
unit’
an
service
automated tell-
considered
er machine or a remote service unit.” See
‘branch’ for purposes of federal bank
12
Thus,
§ 36(j).
U.S.C.
whatever regulato-
branching law and is therefore not subject
ry authority
the states
retain with
prior
approval requirements or geo-
respect
branches,
national bank
graphic restrictions.” Id. at 24.
1996 amendment clearly expresses Con-
gress’s intent that that authority no longer
Finally,
interpretation
given
extends
national bank ATMs.
the 1996
amendment
the Office of the
Comptroller of the Currency (OCC), which
That intent is
even
made
clearer
appears in this action
amicus sup
light of the assumption that Congress en
porting
One,
supports
finding
acts
legislation
knowledge
of relevant
the relevant Iowa regulations
judicial
are preempt-
decisions. See Cannon v. Univer
ed. As we stated in
sity
Taylor, the
Chicago,
Supreme
441
677, 696-99,
Court has
made it
(1979).
clear that
L.Ed.2d
the Comptrol-
Prior
ler’s
amendment,
of the
courts
had
held
entitled
great
because
weight.
were
they
branches
777 (citing
were subject
to state
Clarke v.
Ass’n,
Securities
restrictions.
Indus.
Colorado ex
*6
388,
State
rel.
750,
Bd. v.
107 S.Ct.
(1987)).
93
757
L.Ed.2d
First,
Collins,
Nat’l Bank
Ft.
540 F.2d See also Smiley
(South
v. Citibank
of
Dako-
(10th
497,
Cir.1976)
499
(finding
ta),
reg
N.A.,
735,
517 U.S.
1730,
116 S.Ct.
ulation applied because ATM was a 1733,
(1996);
850
bank
against
as
invalid
held
in Iowa
contained
restrictions
ject to
ATMs.
527.4(1).
§
Code
federal
that the
argues
The State
that
challenges
also
One
Act, 15 U.S.C.
Transfer
Funds
states
Electronic
which
law
of Iowa
provision
regu
states
permits
indi
§§
to advertise
1693-1693r
be used
“shall
The
of funds.
transfer
group of
the electronic
late
institutions or
financial
vidual
“to
in 1978
Code
enacted
was
EFTA
federal
institutions.”
financial
establishing the
has
section
framework
527.5(5). Assuming that
a basic
provide
responsibilities
liabilities,
bank
a national
validity
rights,
any
transfer
respect
fund
holding with
in electronic
of our
light
participants
ATM
1693(b).
pri
527.4(1),
conclude
we
15 U.S.C.
systems.”
section
Na
In Franklin
“is
NBA.
the federal
objective
preempted
mary
York,
rights.”
New
consumer
Bank v.
tional
of individual
provision
(1954), the Su
L.Ed.
allows
the act
goal,
S.Ct.
To achieve
Id.
prohibit
law
a state
held
electronic
Court
preme
over
control
retain
states
word
using the
banks
ing
transfers:
preempted
was
“savings”
or
“saving”
alter,
annul,
or
subchapter
This
noted
Court
holding, the
In so
NBA.
relating
any
laws of
affect
for business
competition
“[m]odern
to the
transfers, except
funds
electronic
usual
the most
one
advertising
finds
inconsistent
laws
that those
extent
believe
We cannot
weapons.
useful
subchapter,
with the
to national
granted
powers
the incidental
the incon-
the extent
only
then
narrowly as
so
construed
should
not inconsistent
law is
A State
sistency.
any
advertising in
use of
preclude
protection
if the
subchapter
Id.
business.”
authorized
their
branch of
great-
consumer
any
affords
law
such
inci
(referring
by this
afforded
protection
er
§ 24
in 12 U.S.C.
granted
powers
dental
subchapter.
Franklin,
con
(Seventh)).
light
*7
the State’s
Despite
1693q.
U.S.C.
regulate
attempt
the State’s
that
clude
is
provision
claims,
anti-preemption
ATMs
Bank One’s
advertisements
of
to the
limited
specifically
Bank, 116
Barnett
preempted.
is
grants
EFTA,
nothing therein
and
federal
inci
(stating
grants
regu-
authority to
any additional
states
normally
national banks
powers
dental
regulation
banks.
national
late
law).
contrary state
preempt
“doing so
where
proper
is
banks
national
a similar
considered
Moreover, the OCC
interfere
significantly
or
prevent
banks
requiring
provision
EFTA
Colorado
its
exercise of
bank’s
with
or
ATMs
names
their
remove
at 1109.
Bank, 116 S.Ct.
Barnett
powers.”
whose
other
of all
the names
place
its
in the
clear
has made
It de-
machines.
use the
may
customers
subject
to be
are not
ATMs
intent
these
letter
interpretative
clared in
the provisions
thus
regulation,
burden
“significant
created
regulations
or
the Iowa
engage
right
national bank’s
aon
Bank One’s
with
interfere
significantly
ATM,
of an
by means
banking
business
must
of its
operation
placement
In-
OCC
[NBA].”
by the
authorized
preempted.
to be
held
Transfer
No. 789 [1997
Letter
terpretative
¶
(CCH) 81-
L.Rep.
Fed.
Binder]
B.
1997) (citing 12
(June 27,
90,244
216 at
anof
grant
be entitled
To
giving
again
(Seventh)). Once
§ 24
U.S.C.
establish
One must
injunction,
OCC’s
deference
con
We
harm.
irreparable
existence
laws, we conclude
banking
ab-
so,
done
it has
clude
law must
provision
sence of an
the continued en-
subsections. Many of these subsections
forcement of the relevant provisions of the
are simply not geographical branching re-
Iowa EFT would result in irreparable eco-
strictions. For example,
527.5(5)
indi-
nomic
loss Bank One. Accordingly, Bank
that,
cates
“[An ATM] terminal shall bear
One is entitled to the
of a
entry
sign
or label no larger than three inches
injunction enjoining the enforcement
two inches identifying
name,
ad-
provisions.
those
dress,
telephone
number
the own-
Thus,
er.”
terms,
this subsection is
of our
view
holding on the preemp-
a straightforward
consumer protection
issue,
tion
we need not
reach
One’s
measure. The need for such measures
remaining challenges to the Iowa statutes.
should be obvious. As any contemporary
The district court’s
reversed,
order
user of ATMs is
attest,
bound to
this tech-
and the case is remanded
the entry
of a
nology, convenient
is,
though it
is fraught
permanent injunction.
with
danger,
anecdotal evidence sug-
gests that errors are not an infrequent
BRIGHT,
Judge,
Circuit
dissenting.
occurrence. Among
possible
mal-
today
reverses the district
functions, bank
*8
116 are preempted thereby. Many of the sec-
1103, 134
(1996),
L.Ed.2d 237
Supreme
tions of Iowa law at issue here are simply
Court
reason
had
to consider the contours
not geographical restrictions and ought not
of preemption in the
context
federal
analyzed
though
as
they were.
banking law. There the
that,
Court noted
view,
In my
those statutory restrictions
defining
“[i]n
the preemptive scope of stat-
imposed under Chapter 527 which are val- utes
regulations
and
granting
power to
id, evenhanded
protections
consumer
are
national banks
...
normally Congress
not preempted by
Thus,
federal
law.
I
not
want
forbid,
States to
or to
believe that the Superintendent
is entitled
impair significantly, the exercise of a pow-
to enforce
banks,
them against
both state
er
explicitly granted.” Id.
and national alike.
I therefore respectful-
at
so does con- by Iowa’s bound remain banks tered of its exercise bank’s national fere with extent To laws. protection sumer original) in (parenthetical Id. powers.” na- means today decision court’s a State Thus, added). when (emphasis national pass, free given are banks tional of a the activities regulate to attempts fa- and a distinct achieve thereby banks jurisdiction, within bank national Competitive law. under position vored they if preempted not are laws State’s is not. equality with interference significant no create ATM bank- powers. relating to its due Iowa exercise The laws bank’s national resi- to Iowa protection granting ing, such Chapter A subsection services, such using others dents pro- more no 527.5(5), which attempt here not I do enforced. should imposi- through the Iowans innocent tect restric- some whether delineate to requirement labeling minimus a de tion applicable not are Code in the tion with interference significant no creates re- may be issues Those banks. national in national vested power legitimate any case. in this litigation on further visited Thus, my otherwise. banks, or explicit given has majority Unfortunately, the simply are subsections view, these of Bank- Superintendent defendant, Iowa’s preempted. the con- on to focus opportunity no ing, note important Moreover, is law. aspects protection sumer equal with applies us before the statute denial only reverses majority national state both force but, sponte, sua preliminary of a comply required Every bank banks. aof entry remands char- by state gained advantage and no requested was action Such injunction. lat- This process. in the institutions tered One, is unwar- Bank plaintiff, by the because important critically point ter raised issues until the ranted, least might by consumerism raised questions up- I would litigated. fully case stat- if Iowa’s analysis different warrant retaining order court’s district hold state favor so as constructed ute were preliminary denying quo status advantage over an them banks, giving case remanding the junction counterparts bank their proceedings. for further district borrowers, depos- competition ongoing Bank all, National fees. After its, and inter- repeatedly (“NBA”) been has Act imba- competitive such preted insure
lances and footing even compete are allowed SMITH, Appellee, Joseph Duane Nat’l banks. Co., Trust & v. Walker Utah Logan, 492, 17 L.Ed.2d 87 S.Ct. HUNDLEY; Hed Paul E. Thomas place intended (1966) (“Congress Helling; Vande G. gepeth; James *9 a basis Appellants. Chaplain, Krol, as Nat’l equality’....”); ‘competitive 98-3522. No. Dickinson, City, Florida in Plant 337, 24 L.Ed.2d Appeals, Court States United “respond[s] (The (1969) Circuit. Eighth dual inherent tensions competitive 12, 1999. May Submitted: reflects [and] ... banking structure Sept. Filed: system neither concern congressional other....”). over advantages have conclusion court’s Ironically, princi- important is at odds
case notes be dispensed court and enjoin it to orders the State improperly, deposits may be incorrectly from enforcing Iowa Code Chapter in recorded, and terminals may simply “eat” its entirety, against Bank One—or card, customer’s ATM refusing to return any other national bank for that matter. it for reasons unknown. When such prob- The court does so because concludes occur, lems customers deserve the infor- that, following Congress’s 1996 changes to mation necessary to correct them. But if the statutory “branch,” definition of as ATMs unmarked, consumers are seri- found in 12 § 36(j), U.S.C. Automated Tell- ously hindered in any attempt to rectify (“ATMs”) er Machines are exempt from even glaring 527.5(5) errors. Section geographical branching requirements nothing more than a rational attempt based in state law. it is While true that address problem and guarantee that such requirements longer no pertain to aggrieved ATM users have recourse to the ATMs,21 agree cannot that this exemption machine’s owners. controls the disposition of the case before Protection of the consumer is well within us. if a Even national bank’s ATMs need power of States to render and comply state law geographic re- preempted by federal law. In the recent strictions, that does not mean other rele- case of Barnett Bank County, Marion vant permissible state law restrictions Nelson, N.A. v. 517