The Supreme Court Monday let stand a decision by the U.S. Court of Appeals for the Seventh Circuit, allowing Illinois insurance regulators to bar a bank from selling the Retirement CD.

Several banking attorneys had predicted the Supreme Court would reject the appeal of American Deposit Corp., which created the federally insured annuity, because Congress adopted a measure last week banning Federal Deposit Insurance Corp. coverage.

Banking lawyer David Roderer said he was disappointed the case won't be reviewed. "The Court of Appeals decision is still troublesome," he said. "It undermines the primacy of the Comptroller of the Currency to rule on these matters."

The high court also declined to hear Branch v. United States, which questions if the cross-guarantee provisions in the 1989 thrift bailout law violate the Fifth Amendment's protection against the unlawful seizure of property.

The court still must decide if it will hear Hess v. FDIC, which questions if the regulator can void contracts that were not on the books when an institution failed. A theory known as the D'Oench Duhme doctrine protects the insurance fund from unscrupulous bankers who enter oral contracts to forgive a borrower's loans just before the institution fails.

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