ABA spurns Mica's olive branch, will appeal FOM defeat

WASHINGTON - In what for the CU side must have been an exasperating rejection of CUNA President Dan Mica's March 30 peace feelers and a sobering fulfillment of NAFCU President Fred Becker's dire prediction (CU Times, April 12), the American Bankers Association (ABA) April 12 officially announced that it would appeal its resounding March 30 loss of the NCUA chartering manual case. "Absolutely, we're going to appeal," ABA Deputy General Counsel for Litigation Michael Crotty confirmed for Credit Union Times, adding that only the timing was in doubt. ABA and co-intervener Independent Community Bankers of America (ICBA) lost on 13 of 14 counts in their year-old challenge to parts of NCUA's H.R. 1151-mandated field-of-membership rule (IRPS 99-1) and were instructed to confer with defendants and to report to the court by April 14 as to how they wanted to proceed on the remaining count. Plaintiffs ordinarily cannot file an appeal to a court ruling until all counts remaining in the lower court action are dispensed with-either through voluntary dismissal or through a ruling from the presiding judge-but the ABA reportedly is loathe to trade dismissing the remaining count for filing speed if that means waiving its right to refile the same complaint at another time. "The bankers have asked (the government) to consent to their moving to dismiss the claims against those credit unions," said a source familiar with the case, "so that the bankers can go ahead and file their appeal very quickly." "The problem with that is that it would allow-in theory, at least-the bankers to refile the claims against the credit unions with some other judge, with some other court. So the issue is then whether (the CU side goes) along with that or whether (the CU side) says, `No, the claims against the credit unions are going to be dismissed with prejudice so they can't be refiled.'" The four community credit unions (CBC FCU, First Service FCU, Wheatland FCU, and Network FCU) whose charter amendments were challenged by the bankers in the remaining count, however, at presstime had not yet decided whether to agree to a dismissal "without prejudice" and go home with what might only be a temporary victory or litigate the matter. Queried on the status of the discussions, NCUA General Counsel Robert Fenner said, "From what I understand, we'd like to have some indication from the other side of what their intent is with respect to refiling the count...before agreeing to dismiss the count. I think they (the bankers) want to have the remaining count dismissed so that they can (appeal)...." "Ideally we'd like to do it with prejudice. I think they want to do it without prejudice...and I think what must be discussed is whether something in between will be agreed to that would give us some indication of what their intentions are with respect to refiling. And I think that's where things are bogged down-and we'll just have to see what happens." At stake in the matter, according to one observer, is the not insignificant prospect that, if the bankers win on the count, the four CCUs could be ordered either to divest themselves of membership gains acquired since their charter amendments were approved or directed to accept no additional members from the barred FOM. Contacted for his reaction to the bankers' rejection, CUNA President Dan Mica said, "The banking trade associations are once again considering misdirecting more of their members' resources (into) harassing credit unions in the courts rather than take up our offer to look for ways to work together on behalf of consumers...." "Should they appeal, the banks can expect us again to use every means at our disposal to defend the interests of credit unions...." "We do not choose this fight; but we will see it through." -gmcorrigan@mindspring.com