1990. Jim Culberson, president of First National Bank & Trust, Asheboro, N.C., convinces four other banks and the American Bankers Association to file a lawsuit against NCUA. The suit argued that AT&T Family FCU of Winston-Salem, N.C., should not have been permitted to take in small employee groups not related to the telephone industry, and challenged NCUA’s interpretation of “common bond” as defined by the 1934 FCU Act.
08/91
U.S. District Court for the District of Columbia dismisses the AT&T case based on “standing.” The bankers appeal the decision.
04/93
The District of Columbia Appeals Court reverses the District of Columbia Court ruling in the AT&T case on “standing.” Case sent back to the District Court to determine whether the FCUA permits select employee groups (SEGs) for FCUs.
1993
In early 1993, the Utah Bankers’ Association files suit in the Third Judicial Court of Salt Lake County seeking to limit the membership base of community-chartered institutions to one county, claiming shared service service centers violate those limits. Utah District Court dismisses argument against shared service centers.
09/93
Financial Institutions for Tax Equality (FITE), a group of six Montana banks and one thrift, files suit in federal court against NCUA over its past approvals of FOM expansions for Missoula FCU. The complaint seeks to rescind all expansions granted to the CU since 1974.
10/93
Nebraska Bankers Association and two western Nebraska banks file suit in state court seeking a reversal of an FOM expansion for Western Heritage Credit Union, which has a community FOM.
1994
A Murfreesboro, Tenn. bank and the Tennessee Bankers Association file suit alleging that NCUA improperly approved a number of FOM expansion requests unrelated to AEDC FCU’s original membership base. The judge affirmed the bankers’ right to sue, but ruled in favor of NCUA and the credit union group. (The bankers appealed decision to the Sixth Circuit Court of Appeals, which issued a 2-1 decision in favor of the bankers on April 14, 1997, but the matter became moot with the passage of HR 1151.)
1994
Texas Bankers Association, the Independent Bankers Association of Texas and six Houston banks file suit in the D.C. federal district court against NCUA over FOM expansions granted Communicators FCU, citing an association group of all persons aged 50 years and older living within 25 miles of CFCU as too broad (which won sympathy among some CUs). Case was assigned to the same judge who decided the FOM case involving AT&T Family FCU, Judge John Pratt.
09/94
U.S. District Court for the District of Columbia rules in favor of NCUA and credit unions in the AT&T Family case and upholds NCUA’s policy allowing SEGs. The bankers appeal.
09/94
Maine Bankers Association files lawsuit in the Superior Court of Kennebec County appealing an order issued by the Maine Bureau of Banking regarding FOM expansions granted Saco Valley CU.
11/94
Maine Bankers Assn. files 2nd suit against the Bureau over its approval of a request by the University of Maine CU to add 40 employees of a local firm. Judge dismisses case.
12/94
Sixth Circuit Court of Appeals issues decision affirming the NCUA’s granting of a community field- of-membership expansion for Portland FCU. The bankers choose not to appeal the decision.
05/95
Judge John Pratt issues a split decision in the Communicators FCU (Texas) case. He once again affirmed the NCUA policy permitting multiple groups within one FOM, but rules NCUA acted improperly in permitting CFCU to add the retiree group.
12/95
Five banks, the Independent Bankers of Colorado and the Colorado Bankers Association file suit against the Colorado Financial Services Board and Gates Credit Union over November 1995 decision to approve expansion of Gates CU’s FOM.
02/96
Wisconsin’s bankers file suit, claiming that Countryside CU was improperly organized and approved for share insurance because it receives support from the government subsidized Farm Credit Agencies (which it wanted to serve). Countryside withdraws application)
07/96
The U.S. Court of Appeals holds that FCU Act does not permit a multiple group FOM and that all members must share a single common bond.
07/96
Banks in Texas file lawsuit involving newly state-chartered Southside CU and its charter to serve low-income community. The suit attracted significant negative media attention for banks.
10/96
U.S. District Court issues a national injunction prohibiting the addition of SEGs and prohibiting FCUs from offering new memberships to people in existing SEGs. CU trade groups say CUs turning away more than 4,000 applicants each day.
10/96
Maine Supreme Court rules in favor of FOM granted Saco Valley CU, saying regulator could conclude that the commonality between two FOMs within a single well-defined community is equal to the commonality within each separate field.
11/96
AT&T Family case appealed to U.S. Supreme Court. CUNA and NAFCU join forces to form Credit Union Campaign for Consumer Choice. Separately, bankers file motion for enforcement of Judge Jackson’s Oct. 25 order, claiming that an interim regulation issued by the NCUA violates the judge’s order because there was no proper notice and comment.
12/96
Judge Jackson denies credit unions’ motion for a stay of his October order pending appeal, and grants bankers’ motion for enforcement of that order, finding that IRPS 96-2 violated the law and his order. NCUA, CUNA and NAFCU file a motion for stay in the D.C. Circuit Court and appeal the Oct. 25 order as well.
12/96
On Christmas Eve, Court of Appeals issues a partial stay on the nationwide injunction, allowing CUs to admit new members from all existing SEGs; prohibition remains against adding new SEGs.
01/07
Court dismisses the Colorado case against Gates CU. Bankers appeal, file a second case involving Longs Peak Credit Union. Meanwhile, regulators in Virginia and Oregon apply the federal injunction against state-chartered CUs.
Texas bank and several bank trade associations file suit against the NCUA in federal district court in D.C., over FOM granted Red River Employees FCU.
02/97
U.S. Supreme Court agrees to hear NCUA’s and the CUs’ appeal of the lower court’s ruling.
03/97
March 20, 1997. Credit Union Membership Access Act, H.R. 1151, introduced by U.S. Reps. Steven LaTourette (R-OH) and Paul Kanjorski (D-PA). The original bill is one sentence long.
05/97
Consumer Federation of America and U.S. Public Interest Research Group and others file amicus briefs with the Supreme Court on behalf of CUs.
07/97
HR 1151 adds its 100th co-sponsor.
07/97
Two credit union “members” file a lawsuit against the Missouri regulator and Mid-Missouri CU claiming MMCU’s FOM violates Missouri CU laws in ways that harm them as members and taxpayers.
10/97
AT&T Family case argued in the U.S. Supreme Court. Separately, ABA and the California Bankers Association file suit in D.C. against NCUA regarding Point Mugu FCU’s conversion from a multiple-group to a community charter. Banks further claim NCUA’s description of Ventura County as predominantly white and middle class means NCUA and the credit union are “red-lining” and violating the Equal Credit Opportunity Act. Also challenged: the “once a member, always a member” policy.
02/98
Speaker of the House Newt Gingrich announces before a roaring crowd at CUNA’s GAC that he will sign on to H.R. 1151 as a cosponsor. Later that day, the Campaign delivers petitions with 2.4 million signatures in support of HR 1151.
02/98
U.S. Supreme Court rules against NCUA and credit unions.
03/98
House Banking Committee holds hearings on the credit union membership issue.
03/98
Thirty-four pages of amendments added to HR 1151 by House Banking Committee. Amendment to stop member business loans is defeated 27-25, before bill passes committee unanimously. Senate Banking Committee holds hearings on FOM issue.
04/98
House votes overwhelmingly, 411-8, in favor of HR 1151.
04/98
The Senate Banking Committee reports out H.R. 1151, just 29 days after the House passed the bill and only after Chairman Sen. Alfonse D’Amato breaks 9-9 tie vote on amendment to require CUs to comply with CRA. D’Amato votes against amendment. An additional 59 pages of language are added to the legislation.
07/98
More than 6,500 credit union supporters show up on short notice for a rally in favor of Senate passage of HR 1151.
07/98
The Senate votes by a margin of 92-6 in favor of HR 1151.
08/98
President Clinton signs HR 1151 into law. The Credit Union Journal cements the reputation it built in covering the fight for HR 1151 over the past two years when it is the only CU publication in the Oval Office for the signing. (c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved. http://www.cujournal.com http://www.sourcemedia.com
