Last year the California Supreme Court held that, under the state’s Unfair Competition Law (UCL), a plaintiff could still sue a bank for violations of the federal Truth-In-Savings Act despite the fact that the part of that law which gave rise to civil actions expired. California’s highest court found that the UCL did not depend on whether other laws actually included an express right to sue. Rather the UCL contained a litany of laws- state and federal – whose violations it deemed provided plaintiffs in California the right to bring an action.
Now the United States Supreme Court is reviewing this California decision, Rose v. Bank of America, S199074 (S. Ct. 2014) and has asked the United States Solicitor General to weigh in. (It is not an uncommon practice for the lead advocate for the federal government to provide its view on the interpretation of a federal statute.) The bank had asked the nations’ highest court on the ground that the repeal of the civil action remedy of the federal law precludes it from serving as the basis for a UCL claim by California bank customers.
California’s Supreme Court had rejected that argument noting that the federal law still contains what is known as the law’s Savings Clause, a provision which retains other aspects of a law after repeal of other parts. “By leaving TISA‟s savings clause in place, Congress explicitly approved the enforcement of
state laws “relating to the disclosure of yields payable or terms for accounts . . .except to the extent that those laws are inconsistent with the provisions of this subtitle, and then only to the extent of the inconsistency.” (§4312) The UCL is such a state law.”
If affirmed, the plaintiffs suing the bank will be entitled to injunctive relief, restitution and attorney’s fees for unlawful and unfair business practices based on violations of TISA disclosure requirements. However, at this juncture, both the parties to the case – as well as those interested in whether states’ laws depending on federal bases for their claims – must wait until possibly the end of June or later to get a definitive answer.
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