Reaction
Lawyers and lobbyists for the credit-card industry, who had feared costly litigation and a myriad of state laws if the Court ruled against OCC, praised the decision. "It's a big victory for the 97 percent or so of cardholders who pay their bills on time," said a Citibank spokeswoman. "There's no reason why those of us who pay on time should subsidize those who do not", said Kendall. That's not equity."
On the other side, Donovan described the result as "an unfortunate interpretation ... that will allow small states to override the longstanding consumer protection laws of more heavily populated ... states." His co-counsel Ann Miller called the decision "incorrect and shortsighted ... I don't think that the answer the U.S. Supreme Court came up with is going to be the long-term resolution of the problems posed by old laws trying to deal with new and very changed banking practices."
Donovan was especially critical of the role played by the OCC. "We got tackled by a player standing on the sideline as we were sprinting toward the goal line". However, it did show him that he'd underestimated the role played by a regulatory body that, he recalled William Rehnquist saying during oral argument, had never come before the Court with a regulation that wasn't favorable to the banking industry. "We should have focused more on the appropriateness of an executive agency defining what Congress meant by a law as opposed to a court defining what Congress meant by a law."
Read more about this topic: Smiley V. Citibank
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