Court Releases Full Copy of Ruling InCommunity CU Case
SHERMAN, Texas - (08/26/05) A federal magistrate has released thetext of its 17-page ruling in its findings against NCUA and theagencys efforts to overturn a member vote in favor ofconversion to a mutual savings bank charter at Community CreditUnion. NCUA invalidated the vote, saying disclosures to memberswere inadequate because of the way the disclosures were folded andprovided to members. The Court finds that the action by theAdministration is arbitrary and capricious, wrote themagistrate. Although the Administration spends considerabletime in its rejection letter on the positioning of the boxeddisclosure, in final analysis, the NCUAs position is thatCCU failed to provide members with required disclosure materials The record indicates that nothing could be further from thetruth. The magistrate ruled that Regional Director JaneWalters had taken it upon herself to determine whether thenotice to members is accurate and not misleading. There is nothingin the Directors letter dated July 11, 2005 that makes anydetermination that the notice was inaccurate or misleading. Theagencys determination was not only inconsistent with its ownregulations, but under all the circumstances, it was arbitrary andcapricious. The magistrate added, the Court findsthat an injunction best serves the public interest by upholding theCCU membership decision, reached in a democratic manner and incompliance with all statutes and regulations, to convert to amutual savings bank.