according to the Ninth Circuit in Wells Fargo Bank N.A. v. Boutris. The opinion, authored by Judge Berzon, begins:
In these cross-appeals concerning California’s regulation of residential mortgage lenders, we decide two issues: First, does the National Bank Act (“Bank Act”), 12 U.S.C. §§ 21 et seq., preempt the California Commissioner of Corporations’(“the Commissioner”) exercise of investigative and licensingauthority over “operating subsidiaries” of national banks? Second, does section 501 of the Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA), 12 U.S.C. § 1735f-7a, preempt California’s per diem loan interest statute?
The district court answered both questions in the affirmative. Wells Fargo Bank, N.A. v. Boutris, 265 F. Supp. 2d 1162 (E.D. Cal. 2003) (Wells Fargo II).1 For the reasons that follow, we affirm the district court’s conclusion as to preemption under the Bank Act but hold that the per diem loan-interest statute is not preempted by the DIDMCA.
The opinion concludes:
As Justice Jackson forcefully put it a half-century ago, “[w]e cannot resolve conflicts of authority by our judgment as to the wisdom or need of either conflicting policy. The compact between the states creating the Federal Government resolves them as a matter of supremacy.” Franklin Nat’l Bank of Franklin Square v. New York, 347 U.S. 373, 378-79 (1954).
“[A]s a matter of supremacy,” the Bank Act, read together with 12 C.F.R. § 7.4006, preempts the exercise of visitorial authority over operating subsidiaries of national banks. Likewise, 12 C.F.R. § 5.34 field-preempts California’s licensing authority over such entities. Section 501(a)(1) of the DIDMCA, however, does not preempt California’s per diem loan intereststatutes.
Among the interesting parts of the opinion, for those intrigued by preemption law, is the court's discussion of when a federal agency can preempt state laws through regulations, in which the court reaffirms that preemption may occur not just by statute but by administrative rules as well, so long as the agency is acting within the scope of its congressionally-delegated authority when it promulgates the rule.
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