WASHINGTON - The banking industry has launched a multistate attack on efforts to limit credit card fees.

The latest volley came Monday, when the American Bankers Association filed briefs in two New Jersey Supreme Court cases. Last month industry groups filed briefs contesting state supreme court cases in Colorado, California, and Pennsylvania.

The trade groups are fighting efforts by consumers to limit the fees that out-of-state banks can charge for credit card services. The trade groups contend that the National Bank Act, which allows banks to charge the maximum interest rate their home state permits, also pertains to fees.

Consumer groups, however, read the law more narrowly, arguing that the bank act does not regulate membership fees, late fees, and other noninterest payments.

The state supreme court cases have taken on added importance since a Pennsylvania superior court judge ruled against the banking industry late last year. Courts in the other four states had sided with the banking industry, but the Pennsylvania decision forced the industry to take the cases more seriously.

In addition to the state court cases, industry and consumer advocates will argue the fee issue Thursday before the U.S. Court of Appeals for the Third Circuit in Philadelphia.

Banking advocates said the continued viability of national credit card operations is at stake in these cases.

"It is an extremely important issue, and we clearly have a large body of law on our side," said Louise A. Rynd, general counsel to the Pennsylvania Bankers Association. "We want to bring the clear and focused attention of the court to the issue."

"It is really not all that complicated," agreed American Financial Services Association general counsel Robert McKew. "It is just something that we have consistently been involved in to protect what we believe is an absolute necessity for operation of a national credit card operation."

Without the rule, banks would have to monitor the consumer protection laws in all 50 states. And, they would need to know the exact day someone moved from one state to another so they could assess the customer the proper fees, he said.

"That is the kind of thing that makes this case important," Mr. McKew said. "When you are only concerned with the law of one state, then that is obviously much easier to keep track of."

Consumer activists said the case involves more than just credit card fees.

"This is about representative democracy," National Consumer Law Center staff attorney Cathy Keest said. "This is about accountability."

The current law allows legislators from a few key banking states to decide what fees consumers throughout the country will pay. That's unconstitutional, Ms. Keest said.

"I agree with them that there is a higher question involved," said American Bankers Association deputy general counsel Michael F. Crotty. "But I believe it is a different higher question. It is whether or not in our democratic system, courts will honor the free choice of grown-ups. You don't have to take a credit card offered by a bank in Delaware. You have other choices."

Ms. Keest said she expects the U.S. Supreme Court to address the issue if any of the four state supreme courts rule against the banking industry.

Banking advocates, however, said they doubt that any of the state courts will rule against the industry.

The trade groups raised several issues in their court filings. First, they said Congress intended section 85 of the National Bank Act to level the playing field between state and national banks.

To do that, lawmakers said local officials cannot regulate the interest rates that out-of-state banks can charge.

That congressional action, however, would be meaningless if states could bypass the interest rate restrictions and regulate fees instead, the industry argued.

For example, a state could rule that national banks cannot charge membership fees but state-chartered thrifts can, Mr. Crotty said.

Second, banking advocates said that allowing states to regulate fees would disrupt interstate lending, an outcome the law seeks to prevent.

Finally, the bank groups said the consumer activists are relying on the wrong part of a federal law for their claim that Congress did not intend interest to include fees.

The industry representatives said section 501 of the Depository Institutions Deregulation and Monetary Control Act of 1980, which the consumers cite, defines interest in relation to certain home mortgages.

But other sections of the act, which the banking industry relies on, define fees as interest for consumer credit loans, the type of lending at issue here.

The U.S. Court of Appeals for the First Circuit in Boston, the only federal appeals court to rule on this issue, accepted similar arguments from the banking industry in a 1992 decision.

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