The Bush administration’s efforts to achieve tort reform through regulatory agency preemption has garnered much academic and press coverage. On November 29, 2006, the Supreme Court will hear oral argument in the case of Watters v. Wachovia Bank. At issue is the scope of the National Bank Act and federal regulation, with Wachovia Bank successfully arguing in the Sixth Circuit Court of Appeals that federal regulations preempt Michigan laws regarding Wachovia’s lending activities. The Supreme Court’s decision will be important not just because of its effect on banking regulation, but also because it will serve as a Roberts Court precedent on the question of how much authority federal regulatory agencies such as the Food and Drug Administration and the National Highway Traffic Safety Administration have to decide to preempt state law.
Does federal banking law bar states from regulating the activities of state-chartered subsidiaries of national banks? What should the appropriate scope of the National Bank Act be? Does state regulation of national banks help or hurt consumers? How much deference should be given to federal agencies’ determinations that their regulations preempt state law?
At this AEI event, panelists will discuss the legal, economic, and policy issues involved. The panel will include George Mason University law professor Todd Zywicki, a member of a group of economists, scholars, and law professors who filed an amicus brief; Columbia law professor Thomas W. Merrill, who represents the Center for State Enforcement of Antitrust and Consumer Protection Laws as amicus in this case; attorney Amy Quester, who represents the Center for Responsible Lending as amicus in this case; and O’Melveny & Myers LLP partner Brian Brooks, an attorney who represents banks in class action defenses in court. Ted Frank, director of AEI’s Liability Project, will moderate.
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