RESPONDENT: First of Omaha Service Corporation
LOCATION: John G. Osborne Elementary School
DOCKET NO.: 77-1265
DECIDED BY: Burger Court (1975-1981)
LOWER COURT: Minnesota Supreme Court
CITATION: 439 US 299 (1978)
ARGUED: Oct 31, 1978
DECIDED: Dec 18, 1978
John Troyer - for petitioner in No. 77-1265
Richard B. Allyn - for petitioner in No. 77-1258
Robert H. Bork - for respondents
Facts of the case
Media for Marquette National Bank of Minneapolis v. First of Omaha Service CorporationAudio Transcription for Oral Argument - October 31, 1978 in Marquette National Bank of Minneapolis v. First of Omaha Service Corporation
Audio Transcription for Opinion Announcement - December 18, 1978 in Marquette National Bank of Minneapolis v. First of Omaha Service Corporation
Warren E. Burger:
The judgment and opinion of the Court in 77-1265, Marquette National Bank against the First Omaha Service Corporation and the consolidated case will be announced by Mr. Justice Brennan.
William J. Brennan, Jr.:
These cases are here on certiorari to the Supreme Court of Minnesota.
The First National Bank of Omaha, Nebraska is a national bank chartered in Nebraska.
It's also enrolled in the BankAmericard plan and includes among its customers under that plan a number of cardholders who are residents of the adjoining State of Minnesota.
The rate of interest permitted to be charged to cardholders under Nebraska law is 18% on unpaid balances.
Under Minnesota law, it's 12%.
The Supreme Court of Minnesota held that this Omaha and Nebraska Bank could charge resident cardholders in Minnesota, the 18% rate and is not limited to the 12% rate authorized by Minnesota law.
The Minnesota Supreme Court reached that conclusion on the ground that as a national bank, the Omaha Bank is a federal instrumentality whose interest rate for its BankAmericard program is governed by federal law, and federal law, the National Bank Act, 12 United States Code Section 85, authorizes a national bank to charge interests on any loan at the rate allowed by the laws of the State where the bank is and the word of the statute is located.
The Minnesota Supreme Court held that the Omaha Bank for the purposes of the statute was located in Nebraska, therefore, authorize the charge in Nebraska 18% rate.
We agree and unanimously affirm the judgment of the Minnesota Supreme Court.
Warren E. Burger:
Thank you, Mr. Justice Brennan.