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Conversion group to appeal court dismissal
WASHINGTON (1/14/08)—-The Coalition for CU Charter Options (CCUCO) will appeal a U.S. District Court ruling which dismissed its suit against the National Credit Union Administration (NCUA) over the agency’s conversion rules. CCUCO filed its notice of appeal Jan. 7 in the U.S. Court of Appeals for the Fourth Circuit, located in Richmond, Va. A federal district court ruled Dec. 7 that the Coalition for CU Charter Options lacked standing to bring suit against NCUA and dismissed the case challenging the agency's rules on credit union conversions to banks. CCUCO has until Jan. 17 to request portions of the trial court's transcript that it plans to use in its arguments to the appeals court. It then has 40 days from when it files the record with the appeals court's clerk in which to file its appellate brief. NCUA, which is represented by the Department of Justice, will then have 30 days from the time CCUCO files its brief to file a brief of its own. In its Dec. 7 ruling, the U.S. District Court for the Eastern District of Virginia found that the coalition failed to show that any of its members were directly damaged or affected by the NCUA's new conversion rules and thereby the group had no "standing" to bring a lawsuit challenging the agency's actions. The CCUCO lawsuit was brought against the NCUA in July and the plaintiff sought to have the court overturn the agency's conversion rule as invalid and arbitrary. The coalition challenged the rule on the grounds that it was inconsistent with the Federal Credit Union Act which requires that the NCUA's conversion regulation to be consistent with that of other financial regulators, such as the Office of Thrift Supervision and the Office of the Comptroller of the Currency. In its short published opinion, the court concluded that NCUA has authority to regulate conversions. It also stated that the Coalition had not shown that any of its members were harmed by the regulations or that any of its members have immediate plans to come under the rules through a conversion application. Credit Union National Association (CUNA) General Counsel Eric Richard said the court's decision "good news for consumers" and said his group expects the conversion group will fare no better in its appeal.


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