Justice Brett Kavanaugh’s recent opinion in Cantero v. Bank of America offers little guidance on reconciling the National Bank Act with a New York statute that mandates interest payments on national bank escrow accounts. Despite the amendments to the National Bank Act under the 2010 Dodd-Frank Act, which provide a detailed preemption standard, the Supreme Court’s decision leaves many questions unanswered.
Kavanaugh’s opinion predominantly revisits earlier jurisprudence, specifically pointing to Barnett Bank v. Nelson. However, rather than providing concrete directions, it summarizes previous cases without expanding the significant-interference test crucial for preemption analysis. The lower court must still perform a “practical assessment” of the interference caused by the state law, a task it failed by relying on outdated precedents.
The ambiguity is especially pressing considering the practical impact this decision may have. The ruling does nothing to clarify whether state laws mandating interest on escrow accounts interfere significantly enough with national banks’ operations to be preempted. As it stands, the lower courts are left with the same vague directives, potentially leading to varied interpretations and applications across different jurisdictions.
For more detailed coverage, see the full analysis on SCOTUSblog.