Banks and Marketplace Lenders Absorb a Blow Under the Supreme Court’s Refusal to Hear Madden v. Midland Funding, LLC
July 21, 2016
Authored by: Daniel Wheeler
Editor’s Note: Our great friends at BankBryanCave, one of the top blogs out there for banking, regulatory, financial institution M&A, and related banking matters, allowed us to cross-post this compelling post on the impact of the Supreme Court’s denial of cert of the 2nd Circuit’s decision in Madden. We think this is pretty important stuff, especially for parties in the consumer debt secondary market.
In a blow to banks and the marketplace lending industry, on June 27, 2016, the U.S. Supreme Court denied the petition by Midland Funding to hear the case Midland Funding, LLC v. Madden (No. 15-610). That case involves a debt-collection firm that bought charged-off credit card debt from a national bank. The borrower’s legal team argued that a buyer of the debt was subject to New York interest rate caps even though the seller of the debt, a national bank, was exempt from those state law rate caps due