In an acidly worded opinion, a federal appeals court concluded this week that a public official unconstitutionally pressured financial institutions to cut ties with a morally disfavored business.

"The analogy is to killing a person by cutting off his oxygen supply rather than by shooting him," Judge Richard Posner wrote for a unanimous three-judge panel.

That's a familiar metaphor, used by a Justice Department lawyer in 2012 at the start of a federal probe that soon sparked a fierce backlash among banks and payday lenders.

But the court's 20-page decision on Monday did not involve Operation Choke Point.

Rather, it came in response to an effort by Cook County, Ill., Sheriff Thomas Dart to persuade Visa and MasterCard to stop processing credit card payments for, a website that features ads for prostitution and other sex-related services.

The colorfully written decision by one of the country's best-known judges outside of the Supreme Court brings refreshing clarity to the debate, sparked by Choke Point, over how far government officials can go in enlisting financial institutions as their deputies.

"Visa and MasterCard were victims of government coercion," the appeals court found.

In contrast to that clear-cut conclusion, much about Choke Point remains cloaked in mystery, even after various investigations and amid an ongoing lawsuit.

Choke Point's architects maintain that the probe is aimed at combating consumer fraud, while its detractors argue that government officials targeted specific industries that they frowned upon. Both sides point to documents that support their position.

The extent to which federal banking agencies, including the Federal Deposit Insurance Corp., went to bat to assist the Justice Department also remains unclear.

Even the legal questions around Choke Point are somewhat muddy. A trade group representing payday lenders sued the FDIC, the Office of the Comptroller of the Currency and the Federal Reserve Board in 2014, arguing that the agencies covertly pressured banks to cut ties with the oft-criticized industry.

The plaintiffs initially argued that the banking agencies violated the Administrative Procedure Act, but that argument has been dismissed. Still standing is a claim that payday lenders' constitutional due-process rights were violated.

Backpage, the Craigslist-like website that brought the Illinois suit, had a more straightforward legal argument. The firm claimed that Sheriff Dart had curtailed its freedom of expression, in violation of the First Amendment.

The case arose from a letter that the sheriff, whose jurisdiction covers the city of Chicago and many of its suburbs, sent to Visa and MasterCard on June 29, 2015. It invoked sex trafficking, implying that the credit card companies were abetting the exploitation of women and girls.

"As the sheriff of Cook County, a father and a caring citizen, I write to request that your institution immediately cease and desist from allowing your credit cards to be used to place ads on websites like," the letter stated.

The next day, a staffer in the sheriff's office sent an email to Visa warning that the sheriff was planning to hold a press conference the following morning.

"Obviously the tone of the press conference will change considerably if your executives see fit to sever ties with Backpage and its imitators," the email stated. "Of course we would need to know tonight if that is the case so that we can ensure the Sheriff's messaging celebrates Visa's change in direction as opposed to pointing out its ties to sex trafficking."

In a subsequent email, one Visa employee wrote to another: "Yes, love the subtle messages they've been sending us that could easily be taken for blackmail."

Still, Visa and MasterCard quickly caved to Sheriff Dart's demands, according to the opinion.

"It might seem that large companies such as Visa and MasterCard would not knuckle under to a sheriff, even the sheriff of a very large county," Posner wrote for the appeals court panel. "That might be true if they derived a very large part of their income from the company that he wanted them to boycott. But they don't."

"The revenue they derived from Backpage's adult ads must have been a small fraction of their overall revenue," Posner continued. "Yet the potential cost to the credit card companies of criminal or civil liability and of negative press had the companies ignored Sheriff Dart's threats may well have been very high."

The judge's opinion drew distinctions between various sex-related services available on sites like Backpage, and at one point quoted from an article titled "What It's Actually Like Being a Dominatrix."

"It's not obvious that such conduct endangers women or children or violates any laws, including laws against prostitution," the judge wrote.

A Visa spokeswoman declined to comment on the court's ruling. A MasterCard spokesman implied that the decision to cut off Backpage is somewhat out of its hands, explaining that Backpage's acquiring bank also played a role.

"Several months ago, we contacted Backpage's acquiring bank about the Cook County Sheriff's claims of Backpage's activities in the U.S., as well as separate violations of MasterCard rules," MasterCard spokesman Seth Eisen said in an email. "The acquirer advised us that they had decided to terminate acceptance. MasterCard has not taken further action since that time."

The Cook County Sheriff's Office released a statement that suggested it is planning to appeal. "While we are not surprised by this opinion, we are nonetheless disappointed and respectfully disagree with its conclusions," the statement said. "We look forward to proceeding with this litigation and we will continue to do all we can to protect victims from the horrors of human trafficking."

It is hard to predict whether Monday's decision will have any impact on the fight over the federal government's controversial efforts to enlist banks in the fight against various disfavored industries.

Charles Cooper, a lawyer for the payday lending group that is suing the FDIC and other federal banking agencies, acknowledged that the cases involve different legal issues but said they overlap thematically.

"We were very interested to see that highly analogous case," he added. "It's entirely in line and in keeping with the theory of our claims."

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.