Facts of the Case

Discover Bank filed this suit in the United States District Court for the District of Maryland in order to compel arbitration on certain counterclaims brought by Betty Vaden, a card member, in a state court suit against her. Discover had originally brought the state suit to recover on Vaden's outstanding credit card balance, but Vaden counterclaimed that certain fees and interest rates had been charged in violation of state law. The district court held that Vaden's usury claims were preempted by federal law and that the agreement clearly contained a provision compelling arbitration in such cases

The U.S. Court of Appeals for the Fourth Circuit agreed with the district court, holding that Discover was the "real party in interest" and that Vaden's claims were therefore preempted by the Federal Deposit Insurance Act. Furthermore, Vaden had failed to overcome the presumption that she received the properly mailed arbitration agreement. Based on these conclusions, the Ninth Circuit granted Discover's motion to compel arbitration.

Question

Does the Federal Deposit Insurance Act preempt usury claims brought against state-chartered, federally-insured banks in state court when the bank is the real party in interest?

Can a plaintiff argue lack of receipt to hold unenforceable an arbitration agreement that was properly mailed without introducing express evidence to support the claim?

Conclusion

None