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Spellman v. Meridian Bank

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT


December 29, 1995

I. ORRIN SPELLMAN, ON BEHALF OF HIMSELF AND ALL OTHERS SIMILARLY SITUATED

v.

MERIDIAN BANK (DELAWARE), AND ITS SUCCESSOR IN INTEREST MELLON BANK (DE); MELLON BANK, (DE) N.A. I. ORRIN SPELLMAN, INDIVIDUALLY AND ON BEHALF OF THE CLASS OF ALL OTHERS SIMILARLY SITUATED,

APPELLANT

NO. 94-3204

ERIC A. GOEHL

v.

MELLON BANK (DE)

ERIC A. GOEHL, INDIVIDUALLY AND ON BEHALF OF THE CLASS OF ALL OTHERS SIMILARLY SITUATED,

APPELLANT

NO. 94-3215

VIRGINIA AMENT, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

PNC NATIONAL BANK, A NATIONAL BANK

(D.C. CIVIL NO. 92-CV-244)

SUZANNE CAPLAN, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

MELLON BANK (DE), N.A.

(D.C. CIVIL NO. 92-CV-302)

SARA J. SZYDLIK; DONALD R. SZYDLIK, FOR THEMSELVES AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

FIRST OMNI BANK, N.A.

(D.C. CIVIL NO. 92-CV-330)

BARBARA S. THOMPSON, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

MARYLAND BANK, A NATIONAL BANK

(D.C. CIVIL NO. 92-CV-346)

VIRGINIA AMENT, SUZANNE CAPLAN, SARA J. SZYDLIK AND DONALD R. SZYDLIK, AND BARBARA S. THOMPSON, INDIVIDUALLY AND ON BEHALF OF THE RESPECTIVE CLASSES THEY REPRESENT OF ALL OTHERS SIMILARLY SITUATED,

APPELLANTS

NO. 94-3216

DAVID A. TOMPKINS, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

AMERICAN GENERAL FINANCIAL CENTER

(D.C. CIVIL NO. 92-CV-375)

DONALD R. SZYDLIK, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

ASSOCIATES NATIONAL BANK (DELAWARE)

(D.C. CIVIL NO. 92-CV-1025)

DAVID A. TOMPKINS AND DONALD R. SZYDLIK, INDIVIDUALLY AND ON BEHALF OF THE RESPECTIVE CLASSES THEY REPRESENT OF ALL OTHERS SIMILARLY SITUATED,

APPELLANTS

NO. 94-3217

KATHLEEN A. DEFFNER, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

CORESTATES BANK OF DELAWARE, N.A. A NATIONAL BANK AND HOUSEHOLD BANK, A FEDERAL SAVINGS BANK

(D.C. CIVIL NO. 92-CV-0398)

BARBARA BARTLAM, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION,

A NATIONAL BANKING ASSOCIATION

(D.C. CIVIL NO. 92-CV-1427)

BARBARA BARTLAM AND KATHLEEN A. DEFFNER, INDIVIDUALLY AND ON BEHALF OF THE RESPECTIVE CLASSES THEY REPRESENT OF ALL OTHERS SIMILARLY SITUATED,

APPELLANTS

NO. 94-3218

DAVID A. TOMPKINS, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED

v.

THE CHASE MANHATTAN BANK (USA), A DELAWARE CHARTERED BANK

DAVID A. TOMPKINS, INDIVIDUALLY AND ON BEHALF OF THE CLASS OF ALL OTHERS SIMILARLY SITUATED,

APPELLANT

On Appeal from the United States District Court for the Western District of Pennsylvania

(D.C. Civil Action Nos. 93-cv-868, 93-cv-878, 92-cv-244, 92-cv-302, 92-cv-330, 92-cv-346, 92-cv-375, 92-cv-1025, 92-cv-398, 92-cv-1427 & 92-cv-714)

Before: SCIRICA, ROTH and SAROKIN, Circuit Judges

ROTH, Circuit Judge.

Argued on February 2, 1995

Filed December 29, 1995)

OPINION OF THE COURT

These eleven consolidated *fn1 actions were brought by concerned Pennsylvanians who believed that they were being charged excessive fees and interest on their credit cards and that these charges violated Pennsylvania consumer protection laws. None of the defendants are Pennsylvania lending institutions. The cases were all brought in Pennsylvania state courts and then removed by the defendants to the federal system. *fn2

These cases require that we resolve the conflict between state consumer-protection law and federal banking law. We will first consider the district courts' holdings that removal jurisdiction was proper, based on the doctrine of complete preemption. We will reverse the district courts on this issue. The Supreme Court's conservative extension of the complete preemption doctrine and the application of the Third Circuit's two-pronged test establish that federal jurisdiction is lacking in those cases in which the plaintiffs did not amend their complaints to allege federal claims.

Certain plaintiffs also alleged federal causes of action against California lending institutions. *fn3 Consequently, we will next consider claims particular to these actions, which the district court dismissed. We conclude that the district court properly determined that the plaintiffs in two of the California-lender actions lacked standing. In the remaining action, however, we must consider whether the term "interest" in Section(s) 30 of the National Bank Act, 12 U.S.C. Section(s) 85 (1988), encompasses late charges and over-limit fees assessed to credit card holders. We will affirm the district court to the extent that the court held that plaintiffs' state law claims regarding late charges and over-limit fees were substantively preempted. See Ament v. PNC Nat'l Bank, 849 F. Supp. 1015, 1018-21 (W.D. Pa. 1994). We will reverse and remand, however, for further proceedings regarding the legality of these fees under California law.

I.

Plaintiff cardholders allege that the defendant banks violated Pennsylvania law by charging certain fees in connection with their credit card programs. Plaintiffs' accounts are governed by agreements that provide for one or more of the following charges: percentage-based finance charges on outstanding balances, annual fees, over-credit limit charges, late charges, returned check charges, and cash advance fees. Plaintiffs contend all of the charges, except for the finance charges, violate Pennsylvania statutory *fn4 and common law.

Plaintiffs filed eleven separate actions in the Courts of Common Pleas for Allegheny and Philadelphia counties. The banks filed notices of removal based on federal question and diversity jurisdiction. The nine cases filed in Allegheny County were removed to the United States District Court for the Western District of Pennsylvania, where they were consolidated. The two Philadelphia County cases were removed to the United States District Court for the Eastern District of Pennsylvania.

Plaintiffs moved to remand. The district courts denied the motions, holding federal question jurisdiction existed based on the "complete preemption" doctrine. Goehl v. Mellon Bank (DE), 825 F. Supp. 1239, 1243 (E.D. Pa. 1993); Ament, 825 F. Supp. at 1251. The district court then transferred the Eastern District cases to the Western District.

The banks filed motions to dismiss, for judgment on the pleadings and for summary judgment. The district court granted the motions and dismissed all of the actions, holding that Section(s) 30 of the National Bank Act, 12 U.S.C. Section(s) 85, *fn5 and Section(s) 521 of the Depository Institutions Deregulation and Monetary Control Act of 1980 ("DIDA"), 12 U.S.C. Section(s) 1831d (1988 & Supp. III 1991), preempted Pennsylvania's prohibition of the challenged fees. Ament, 849 F. Supp. at 1018-19. The district court held that the banks' charges constituted "interest" under federal law and that plaintiffs' state law claims were preempted. Id. at 1019-21. These consolidated appeals followed. Assuming the district court properly had jurisdiction, we have appellate jurisdiction under 28 U.S.C. Section(s) 1291 (1988).

II.

Plaintiffs challenge the propriety of federal court removal jurisdiction in all but three of these cases. *fn6 Defendant's removal petitions were premised on both federal question jurisdiction, via the complete preemption doctrine, and on diversity of citizenship. The district court asserted subject matter jurisdiction based on complete preemption and therefore failed to reach diversity. We disagree. We find no jurisdiction under either the complete preemption doctrine or the diversity statute.

We exercise plenary review in jurisdictional matters. Packard v. Provident Nat'l Bank, 994 F.2d 1039, 1044 (3d Cir. 1993), cert denied sub nom. Upp v. Mellon Bank, N.A., ___ U.S. ___, 114 S.Ct. 440 (1993). Removal of civil actions from state to federal court is governed by 28 U.S.C. Section(s) 1441 (1988), which provides in pertinent part:

Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the . . . defendants[] to the district court of the United States for the district and division embracing the place where such action is pending.

Removal is therefore premised on original jurisdiction, which in turn must rest on either federal question jurisdiction under 28 U.S.C. Section(s) 1331 or on diversity jurisdiction under 28 U.S.C. Section(s) 1332.

We first consider federal question jurisdiction under 28 U.S.C. Section(s) 1331, the basis upon which the district court found jurisdiction. In determining whether a federal question is raised, the "well-pleaded complaint" rule applies. Railway Labor Executives Ass'n v. Pittsburgh & Lake Erie R.R. Co., 858 F.2d 936, 939 (3d Cir. 1988). This rule requires the federal question be presented on the face of the plaintiff's properly pleaded complaint in order for the case to be removable under Section(s) 1441. See Gully v. First Nat'l Bank, 299 U.S. 109, 112-13 (1936). The presence of a federal defense does not make a case removable even if the defense is preemption and even if the federal defense is the only issue in the case. Caterpillar Inc. v. Williams, 482 U.S. 386, 393 (1987). The well-pleaded complaint rule "makes the plaintiff the master of the claim; he or she may avoid federal jurisdiction by exclusive reliance on state law." Id. at 392.

The doctrine of complete preemption is a narrow corollary to the well-pleaded complaint rule. The Supreme Court explained the doctrine in Caterpillar Inc., 482 U.S. at 393 (citation omitted):

On occasion, the Court has concluded that the pre-emptive force of a statute is so "extraordinary" that it "converts an ordinary state common-law complaint into one stating a federal claim for purposes of the well-pleaded complaint rule." . . . Once an area of state law has been completely pre-empted, any claim purportedly based on that pre-empted state law is considered, from its inception, a federal claim, and therefore arises under federal law.

The complete preemption doctrine is of recent vintage. Since 1968, the Supreme Court has found complete preemption expressly in only two settings: (1) for claims alleging a breach of a collective bargaining agreement that fall under Section(s) 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. Section(s) 185 (1988), see Avco Corp. v. Aero Lodge No. 735, 390 U.S. 557 (1968); and (2) for claims for benefits or enforcement of rights under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. Section(s) 1132(a)(1)(B) (1988), see Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63-67 (1987). *fn7 The Court has applied the doctrine "primarily in cases raising claims pre-empted by Section(s) 301 of the LMRA." Caterpillar Inc., 482 U.S. at 393. Other courts of appeals have cautiously extended the boundaries of the complete preemption doctrine in some instances *fn8 but refused to expand the doctrine in others. *fn9

This court has adopted a two-pronged test by which a federal court may determine whether it is authorized to assert complete preemption jurisdiction. Pursuant to the test, a court determines the "very limited area in which a federal court in a case removed from a state court is authorized to recharacterize what purports to be a state law claim as a claim arising under a federal statute." Railway Labor, 858 F.2d at 942. First, the court must determine that "the statute relied upon by the defendant as preemptive contains civil enforcement provisions within the scope of which the plaintiff's state claim falls." Id. at 942 (citing Franchise Tax Board, 463 U.S. at 24, 26). Second, the court must find "a clear indication of a Congressional intention to permit removal despite the plaintiff's exclusive reliance on state law." Id.; see also Goepel v. National Postal Mail Handlers Union, 36 F.3d 306, 311 (3d Cir. 1994), cert. denied, __ U.S. __, 115 S. Ct. 1691 (1995); Krashna v. Oliver Realty, Inc., 895 F.2d 111, 114 (3d Cir. 1990).

The first prong of the test requires a comparison between the federal statute's enforcement provisions and the nature of the plaintiffs' claims. We must ask if the National Bank Act's and DIDA's civil enforcement provisions, 12 U.S.C. Section(s) 86 and 1831d, govern the same interests plaintiffs seek to vindicate in their suits. See Allstate Ins. Co. v. 65 Security Plan, 879 F.2d 90, 93-94 (3d Cir. 1989).

Section 86 of the National Bank Act sets forth the civil enforcement provision for individuals charged excessive interest by national banks: The taking, receiving, reserving, or charging a rate of interest greater than is allowed by section 85 of this title, when knowingly done, shall be deemed a forfeiture of the entire interest which the note, bill, or other evidence of debt carries with it, or which has been agreed to be paid thereon. In case the greater rate of interest has been paid, the person by whom it has been paid, or his legal representatives, may recover back, in an action in the nature of an action of debt, twice the amount of the interest thus paid from the association taking or receiving the same: Provided, That such action is commenced within two years from the time the usurious transaction occurred.

12 U.S.C. Section(s) 86. This section contains the exclusive remedy for borrowers to enforce the terms of Section(s) 85 of the National Bank Act *fn10 and to recover impermissible loan fees collected by national banks. M. Nahas, 930 F.2d at 610; see also McCollum v. Hamilton Nat'l Bank, 303 U.S. 245, 248 (1938); Evans v. National Bank of Savannah, 251 U.S. 108, 109, 114 (1919); Farmers' & Mechanics' Nat'l Bank v. Dearing, 91 U.S. 29, 34-35 (1875).

Section 521 of DIDA sets forth the civil enforcement provision for individuals charged excessive interest by federally insured state banks:

[T]he taking, receiving, reserving, or charging a rate of interest greater than is allowed by subsection (a) of this section, *fn11 when knowingly done, shall be deemed a forfeiture of the entire interest which the note, bill, or other evidence of debt carries with it, or which has been agreed to be paid thereon. If such greater rate of interest has been paid, the person who paid it may recover in a civil action commenced in a court of appropriate jurisdiction not later than two years after the date of such payment, an amount equal to twice the amount of the interest paid from such State bank or such insured branch of a foreign bank taking, receiving, reserving, or charging such interest. 12 U.S.C. Section(s) 1831d(b) (footnote supplied).

This section is identical to Section(s) 86 in all material respects, and Congress wrote it to duplicate the scope of Section(s) 86. Cf. Greenwood Trust Co. v. Massachusetts, 971 F.2d 818, 826 & n.7 (1st Cir. 1992) (noting the identity of language between the first part of Section(s) 521 of DIDA and Section(s) 85 of the National Bank Act), cert. denied, __ U.S. __, 113 S. Ct. 974 (1993). The scope of the two sections is identical, and the interests covered by Section(s) 86 are the same as those covered by Section(s) 521.

The banks correctly assert that the interests the cardholders seek to vindicate are the same as those protected by both federal statutes. Plaintiffs' causes of action under state law rest on complaints that national banks and federally insured state-chartered banks charged impermissible fees in connection with credit card loans. Recovery of impermissible loan fees is precisely the interest that Section(s) 86 of the National Bank Act and Section(s) 521 of DIDA govern. *fn12 This satisfies the first prong of the test for complete preemption.

The second prong of the complete preemption analysis, in which we examine congressional intent, presents a closer question. Congress has broad authority to control the jurisdiction of the lower federal courts. See Kline v. Burke Constr. Co., 260 U.S. 226, 233-34 (1922) (observing that, aside from the Supreme Court, "[e]very other court created by the general government derives its jurisdiction wholly from the authority of Congress"). Accordingly, the existence of removal jurisdiction in a particular case turns on whether Congress has granted it.

In concluding that Congress intended to permit removal in cases implicating Section(s) 85 and 86 of the National Bank Act, the district courts held that Congress manifested its intent to completely preempt the area by creating an exclusive federal remedy for usury claims against national banks. Goehl, 825 F. Supp. at 1243; Ament, 825 F. Supp. at 1251. By so holding, the trial courts misapplied the second prong of the test laid out in Railway Labor as a matter of law.

The district courts relied on the reasoning of M. Nahas & Co. v. First Nat'l Bank, 930 F.2d 608, 612 (8th Cir. 1991), a case in which the Court of Appeals for the Eighth Circuit found Section(s) 86 of the National Bank Act to be "an exclusive federal remedy, created by Congress over 100 years ago to prevent the application of overly-punitive state law usury penalties against national banks." The plaintiff in M. Nahas brought suit in state court against a national bank, alleging that the bank charged an interest rate that was usurious under state law. The bank removed the action to federal district court, and the court refused to remand, holding that the claim was properly characterized as federal. The circuit court affirmed.

The M. Nahas holding applied on its face to an instance in which a bank charged a percentage interest rate higher than that allowed by state law. Following M. Nahas, however, numerous district courts have held that the National Bank Act completely preempts state laws that limit or prohibit late fees and other such fees charged by national banks. *fn13 Moreover, a district court in the Eighth Circuit extended the M. Nahas holding to Section(s) 521 of DIDA, where the plaintiffs challenged late fees and over-limit charges pursuant to state law. See Hill v. Chemical Bank, 799 F. Supp. 948 (D. Minn. 1992). The court held that "like Section(s) 86 [of the National Bank Act], Section(s) 521(b) creates an exclusive federal remedy" and therefore "completely preempts the field of usury claims against federally-insured state banks." Id. at 952.

Although the banks rely on M. Nahas and its progeny to support their argument in favor of federal jurisdiction, none of the cases are binding on this court. Moreover, they are inconsistent with this court's previous opinions regarding complete preemption, because they do not convincingly establish congressional intent to make causes of action within the scope of Section(s) 85 and 86 of the National Bank Act, or Section(s) 521 of DIDA, removable to federal court. *fn14

Indeed, the Eighth Circuit has rejected expressly the two-pronged complete preemption analysis that this court set forth in Railway Labor. See Deford v. Soo Line R.R. Co., 867 F.2d 1080, 1086 (8th Cir.) (rejecting this court's reasoning in Railway Labor and holding that the Railway Labor Act completely preempts state law claims), cert. denied, 492 U.S. 927 (1989); see also, Goepel, 36 F.3d at 315 n.12 (acknowledging the split between the two courts of appeals). The Eighth Circuit called the Third Circuit's approach "unnecessarily narrow," stating: Not only must we look to affirmative congressional intent and civil enforcement provisions, but we must also look to such factors as the history and purpose of the statute. Recent case law illustrating the federal nature of the statute and analogous statutes with complete preemptive powers are also informative. Id.

Although an examination of Congress's basic goals in enacting Section(s) 85 and 86 and the history behind them would be consistent with the Eighth Circuit's approach, such an approach would diverge from that which this court has prescribed. *fn15 Moreover, it is at odds with the Supreme Court's narrow application of the complete preemption doctrine.

The Supreme Court has held affirmative evidence of congressional intent to be "the touchstone of the federal district court's removal jurisdiction." Metropolitan Life, 481 U.S. at 66. And, as discussed above, the Court has found such intent only rarely. The complete preemption doctrine was originally rooted in a cause of action arising under Section(s) 301 of the LMRA. See Avco Corp., 390 U.S. at 557. The Court extended the doctrine reluctantly, in Metropolitan Life, to an action arising under ERISA. The Court wrote that it did so only because "ERISA's civil enforcement provisions closely parallels [sic] that of Section(s) 301 of the LMRA," and because explicit language in the ERISA Conference Report analogized the ERISA provision to the LMRA language. Metropolitan Life, 481 U.S. at 65; Railway Labor, 858 F.2d at 940. "In the absence of explicit direction from Congress," the Court wrote, [e]ven with a provision such as Section(s) 502(a)(1)(B) [the jurisdictional provision] that lies at the heart of a statute with the unique pre-emptive force of ERISA . . . we would be reluctant to find that extraordinary pre-emptive power, such as has been found with respect to 301 of the LMRA, that converts an ordinary state common law complaint into one stating a federal claim for purposes of the well-pleaded complaint rule. Metropolitan Life, 481 U.S. at 64-65. *fn16

Neither the National Bank Act nor DIDA contains a jurisdictional provision evidencing congressional intent to permit removal of the sort relied upon in Avco and Metropolitan Life. Nor have the banks pointed to congressional language suggesting that parties may bring suit against banks in federal court without regard to the citizenship of the parties or the amount in controversy.

Congressional intent to permit removal based on complete preemption would be difficult to divine from the legislative history of the National Bank Act, because the Act was passed in 1864, pre-dating federal question jurisdiction, the well-pleaded complaint rule, and the doctrine of complete preemption. *fn17 The banks argue, nonetheless, that Congress evidenced an intent to provide an exclusive source of relief for claims of overcharge that, coupled with the general federal provision allowing for removal of federal-question cases, demonstrates congressional intent to allow removal. However, the defendants point to nothing in the legislative history of Section(s) 85 and 86 that presents the sort of clear indication of congressional intent we have looked for in the past. *fn18

Similarly, when Congress enacted Section(s) 521 of DIDA in 1980, it did not adopt language or indicate in the legislative history that the provision would support complete preemption. Cf. Donald v. Golden 1 Credit Union, 839 F. Supp. 1394, 1402 (E.D. Cal. 1993) (refusing to find complete preemption pursuant to Section(s) 523(b) of DIDA -- which contains parallel language to Section(s) 521 but governs insured credit unions -- because nothing in the provision's legislative history "mentions 'arising under' jurisdiction or compares the effect of Section(s) 523(b) to Section(s) 301 of the LMRA or Section(s) 502(f) of ERISA").

There appears to be no indication that Congress intended to completely preempt the regulation of national banks or federally-insured state lending institutions. *fn19 Therefore, we will reverse the judgments of the district courts that found complete preemption. Jurisdiction cannot rest on 28 U.S.C. Section(s) 1331.

The district court did not consider diversity jurisdiction. Because we do not find jurisdiction based on complete preemption, we must do so. Although this issue was not raised in the parties' briefs, defendants have presented the issue in a supplemental motion. Moreover, as a court of limited jurisdiction we have a duty to raise potential jurisdictional issues sua sponte. Employers Ins. of Wausau v. Crown Cork & Seal Co., 905 F.2d 42, 45 (3d Cir. 1990); Trent Realty Assoc. v. First Fed. Sav. & Loan Ass'n of Philadelphia, 657 F.2d 29, 36 (3d Cir. 1981). We find that the requirements for jurisdiction based on diversity of citizenship are not met.

We observe initially that the cases consolidated before us each purport to advance the interests of a class, but not one has been certified as a class action. Our position is therefore analogous to our previous decision in Packard, 994 F.2d at 1043 n.2 (noting that no class was ever certified). Despite the absence of certification, class action principles still apply: To support diversity jurisdiction, there must be complete diversity between the named representatives of the class and the defendants, In re School Asbestos Litig., 921 F.2d 1310, 1317 (3d Cir. 1990), cert. denied sub nom. U.S. Gypsum Co. v. Barnwell Sch. Dist. No. 45, 499 U.S. 976 (1991), and each member of the class must meet the statutorily required minimum amount in controversy, In re Corestates Trust Fee Litig., 39 F.3d 61, 64 (3d Cir. 1994). We also observe that because the issue of diversity jurisdiction arises on removal, the defendant bears the burden of proving the statutory requirements. Wilson v. Republic Iron & Steel Co., 257 U.S. 92, 97 (1921); Columbia Gas Transmission Corp. v. Tarbuck, 62 F.3d 538, 541 (3d Cir. 1995). All doubts on removal are resolved in favor of remand. Boyer v. Snap-on Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990), cert. denied, 498 U.S. 1085 (1991); Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 29 (3d Cir. 1985).

Diversity jurisdiction founders on the amount in controversy requirement. 28 U.S.C. Section(s) 1332(b). *fn20 As the party asserting jurisdiction, defendants must demonstrate that each member of the plaintiff class alleges an amount in controversy greater than $50,000. Id. In assessing the amount claimed where the defendant seeks removal, we place great confidence in the allegations of the plaintiff's complaint, because we presume that the plaintiff has not claimed an excessive amount in order to obtain federal jurisdiction. St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 289 (1938); Albright v. R. J. Reynolds Tobacco Co., 531 F.2d 132, 134 (3d Cir.) (recognizing different standard for evaluating jurisdictional amount on removal compared to original jurisdiction), cert. denied, 426 U.S. 907 (1976). Moreover, a plaintiff who has a claim for more than the jurisdictional amount may choose to sue for a lesser amount to avoid the monetary threshold for removal. St. Paul, 303 U.S. at 292; Burns v. Windsor Ins. Co., 31 F.3d 1092, 1095 (11th Cir. 1994); Gafford v. General Elec. Co., 997 F.2d 150, 157 (6th Cir. 1993). Accordingly, the defendant who seeks removal and challenges either explicitly or implicitly the jurisdictional amount alleged by the plaintiff faces a heavy burden. Cf. Steel Valley Auth. v. Union Switch & Signal Div., 809 F.2d 1006, 1012 n.6 (3d Cir. 1987) (discussing challenge to joinder of non-diverse defendant to defeat diversity), cert. dismissed sub nom. American Standard, Inc. v. Steel Valley Auth., 484 U.S. 1021 (1988).

In the case before us, defendants have failed to carry this burden. It cannot be alleged seriously that the amounts sought by any individual plaintiff exceed $50,000, even accounting for the possibility of treble damages under certain Pennsylvania consumer protection statutes. Pa. Stat. Ann. tit. 69, Section(s) 2204 (West 1994); Pa. Stat. Ann. tit. 73, Section(s) 201-9.2 (West 1993). The individual plaintiffs sue for a variety of charges ranging from a $2 fee per cash advance to a $60 annual fee, with the vast majority of the charges hovering in the $10-$18 range. *fn21 It is well-settled that members of a class cannot aggregate their claims to exceed the jurisdictional threshold. Snyder v. Harris, 394 U.S. 332, 338 (1969). Each class member must claim the requisite amount in controversy. Zahn v. International Paper Co., 414 U.S. 291, 301 (1973). None of the individual claims will support diversity jurisdcition. *fn22

Absent aggregation, three possible routes to the $50,000 minimum lie open. Plaintiffs seek injunctive relief prohibiting the defendants from receiving, charging, or contracting for the challenged fees. If the value of the injunction sought is viewed from the defendants' perspective, it could produce a loss in revenue exceeding the statutory threshold. Defendants also allege diversity jurisdiction based on the "total detriment" they would suffer if injunctive relief were granted. In addition, defendants cite a potential recovery that could include substantial attorneys' fees. We review each argument in turn.

We first reject the suggestion that the request for injunctive relief converts these individual actions for fees into a collective action for the total value of the fees to the defendant. In In re Corestates Trust Fee Litig., we observed that, In injunctive actions, it is settled that the amount in controversy is measured by the value of the right sought to be protected by the equitable relief. See Smith v. Adams, 130 U.S. 167, 175, 9 S.Ct. 566, 569, 32 L.Ed. 895 (1889); Spock v. David, 469 F.2d 1047, 1052 (3d Cir. 1972) ("In cases where there is no adequate remedy at law, the measure of jurisdiction is the value of the right sought to be protected by injunctive relief."), rev'd on other grounds Greer v. Spock, 424 U.S. 828, 96 S.Ct. 1211, 47 L.Ed.2d 505 (1976). In other words, "it is the value to plaintiff to conduct his business or personal affairs free from the activity sought to be enjoined that is the yardstick for measuring the amount in controversy." 14A C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure, Section(s) 3708 at 143-44 (2d ed. 1985) (citations omitted). 39 F.3d 61, 65 (3d Cir. 1994).

Following this rule, we assessed the requested relief based on its value to the individual plaintiff, and we expressly rejected the contention that injunctive relief somehow broadened the amount at issue beyond the plaintiff's stake. Id. at 66. In reaching this holding, we built on our decision in Packard, where on facts similar to Corestates, we held that a challenge to a small "sweep fee" levied by banks as part of their management of trust accounts placed in controversy only the value of the fee to each individual plaintiff, not the aggregate cost of the injunction to the bank. Packard, 994 F.2d at 1050. We abide by these rulings in the present situation as well. Taken alone, plaintiffs' prayers for injunctive relief will neither convert their individual claims into a collective recovery, nor force us through the looking glass to evaluate their claims from the defendant's perspective.

This same authority requires us to reject defendant's second contention, the "total detriment" theory. See Packard, 994 F.2d at 1050 ("allowing the amount in controversy to be measured by the defendant's cost would eviscerate Snyder's holding that the claims of class members may not be aggregated in order to meet the jurisdictional threshold"); Brechbill v. Diner's Club, 80 F.R.D. 486 (W.D. Pa. 1978) (rejecting "total detriment" concept); see also Snow v. Ford Motor Co., 561 F.2d 787, 790 (9th Cir. 1977). Allowing a defendant to inject the "total detriment" theory would give the defendant control over forum selection whenever a claim could be generalized beyond the individual plaintiff. Our precedents dispose of this argument.

Finally, we turn to the issue of attorneys' fees. It is well-settled that where reasonable attorneys' fees are a part of the statutory action and have been requested by plaintiffs, their value will be assessed as part of the amount in controversy. Missouri State Life Ins. Co. v. Jones, 290 U.S. 199 (1933). Here, to satisfy the $50,000 minimum, attorneys' fees would have to make up the vast majority of the required quantum. Just as we scrutinize a claim carefully where a request for punitive damages comprises the majority of the jurisdictional amount, Packard, 994 F.2d at 1046, we will look equally critically at any case where attorneys' fees constitute the principal basis for jurisdiction. We also note that conceptually, consistent with Snyder and Zahn, attorneys' fees must be distributed across the class or across the claimants. See Goldberg v. CPC Int'l, Inc., 678 F.2d 1365, 1367 (9th Cir.), cert. denied, 459 U.S. 945 (1982); but see In re Abbott Laboratories, 51 F.3d 524, 526-27 (5th Cir. 1995) (allocating attorneys' fees to class representative under Louisiana class action fee recovery statute). Hence, to support jurisdiction, the attorneys' fees of each individual plaintiff combined with the other elements of the prayer for relief must exceed the statutory minimum.

In a typical commercial case such as this one, we cannot believe that where each individual plaintiff asserts claims in the range of tens to hundreds of dollars, an attorney's fee exceeding $49,000 would be either reasonable or justified. See, e.g., Neff v. General Motors Corp., ___ F.R.D. ___, 1995 WL 653961 (E.D. Pa. Nov. 7, 1995) (Dalzell, J.) (reaching similar conclusions after excellent discussion of removal issue). A difference of this order of magnitude is conclusive. Moreover, aside from their bare assertion that attorneys' fees would be sufficient to satisfy the statutory minimum, defendants have offered no proof on this issue. Because the burden of demonstrating jurisdiction lies squarely on the removing defendants, we have little trouble holding that the potential for attorneys' fees will not satisfy the jurisdictional amount.

We conclude that it appears "to a legal certainty" that the claims in question were "for less than the jurisdictional amount." St. Paul, 303 U.S. at 289. In reaching this conclusion, we continue our tradition of reading the diversity statute narrowly so as not to frustrate Congress' purpose in keeping the diversity caseload of the federal courts under some modicum of control. Packard, 994 F.2d at 1044-45; Nelson v. Keefer, 451 F.2d 289, 293-94 (3d Cir. 1971). We therefore find no jurisdiction under 28 U.S.C. Section(s) 1332. See Smiley v. Citibank (S.D.), N.A., 863 F. Supp. 1156, 1162-65 (C.D. Cal. 1993) (refusing diversity-based removal because class members claims could not be aggregated, increased through punitive damages, or viewed collectively under an injunction to meet jurisdictional amount); Hunter v. Greenwood Trust Co., 856 F. Supp. 207, 220 (D.N.J. 1992) (refusing diversity-based removal in challenge to late fees on credit cards "because the jurisdictional amount in controversy is not satisfied"); Copeland v. MNBA America, N.A., 820 F. Supp. 537, 541-42 (D. Colo. 1993) (same).

We hold that both federal question jurisdiction and diversity jurisdiction are lacking. Removal was therefore improper. Consequently, we will reverse the assertion of jurisdiction and instruct the district judges to remand the non-California lender cases to the state courts.

III.

Although our discussion to this point disposes of most of the cases before us, the three California lender cases remain. In these disputes the plaintiffs amended their complaints to allege specific violations of federal law, obviating the jurisdictional issue. The plaintiffs in these cases raise different challenges that we now address.

A.

The plaintiffs in Bartlam v. Bank of America, No. 94-3217, and Deffner v. Corestates Bank, No. 94-3217, ask us to consider whether the district court properly determined that they lack standing. Because we will affirm, we do not reach the other issues that these plaintiffs raise.

Plaintiff Bartlam brought suit against Bank of America pursuant to the National Bank Act and two Pennsylvania consumer protection statutes. She challenged a late payment charge, a return check charge, and an over-credit limit charge based on her credit card agreement with Bank of America. Bartlam concedes that she has no standing to challenge the credit limit charge (as no such charge was part of her credit agreement) and that she did not actually incur a return check charge or late fee during the relevant period. Nevertheless, she argues that the district court erred in deciding that she lacked standing. The National Bank Act, she asserts, creates a cause of action for usurious charges even if the borrower has not actually paid them but has merely contracted for them. She also argues that the district court's holding on standing is inconsistent with its holding on complete preemption.

The requirements for standing are clear. The plaintiff must have suffered an injury in fact, the injury must be "fairly . . . traceable to the challenged action of the defendant," and it must be likely the injury would be redressed by a favorable decision. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992); Warth v. Seldin, 422 U.S. 490, 501 (1975). Bartlam did not pay the contested charges within the statute of limitations period in Section(s) 86 and therefore cannot meet the injury in fact requirement. See also Haas v. Pittsburgh Nat'l Bank, 526 F.2d 1083 (3d Cir. 1975) (holding plaintiff lacked standing to challenge a service charge when she had not incurred the relevant charge).

Despite this problem, Bartlam alleges that she has standing because Bank of America contracted with her for the contested fees. She contends the term "reserve" in Section(s) 85 means "to contract," *fn23 and that the formation of a contract with usurious interest was enough to violate the terms of the statute and provide standing for a cause of action under Section(s) 86. We do not agree. The Supreme Court has explained that the term "reserve" refers to the practice of discounting, where a bank reduces the principal of a loan by deducting interest in advance:

To discount, ex vi termini, implies reservation of interest in advance . . . . [W]e think Congress intended to endow national banks with the power, which banks generally exercise, of discounting notes reserving charges at the highest rate permitted for interest. To carry out this purpose, the National Bank Act provides that associations organized under it may reserve on any discount interest at the rate allowed by the State; and only when there is reservation at a rate greater than the one specified does the transaction become usurious. Evans, 251 U.S. at 114.

This passage makes clear that "reserving" does not mean "contracting." More importantly, regardless of how one defines "reserve," 86 does not provide a cause of action unless the borrower has actually paid the interest sought to be recovered. McCarthy v. First Nat'l Bank, 223 U.S. 493, 498-99 (1912). Section 86 contemplates two types of cases, those where the lender sues for usurious charges the borrower has not paid, and those where the borrower seeks to recover usurious interest he has paid. Id. Section 86 provides a cause of action for the latter instance, but not the former. For unapid charges, Section(s) 86 provides the borrower with a defense to a suit brought by the bank, but it does not allow the borrower to sue directly. Id. Thus, the National Bank Act does not provide a cause of action for charges for which the borrower has contracted but not paid. Bartlam's claim is not legally cognizable.

Finally, Bartlam argues that the district court's holding that complete preemption allowed removal is inconsistent with its holding that she lacks standing. Subject matter jurisdiction in this case was based on the allegation in plaintiff's amended complaint that Bank of America had violated 12 U.S.C. Section(s) 85. *fn24 The district court had jurisdiction over the case based on this federal question, and it was not inconsistent for the district court to declare that the plaintiff lacked standing. Moreover, complete preemption jurisdiction did not exist in any event. *fn25

The district court's holding that Barlam lacked standing was therefore correct. We will affirm the district court's dismissal of Bartlam's federal claims but remand the matter to the district court so that it may in turn remand the case to state court.

B.

We next consider similar standing arguments made in Deffner. Appellant Deffner filed a class action against Household, a federal savings association located in California, and against Corestates Bank of Delaware, N.A., a national bank located in Delaware, alleging that various credit card charges imposed pursuant to their credit agreements violated Pennsylvania state law. Deffner subsequently amended the complaint to include two new federal claims against Household, alleging that Household's over-credit limit charges, late payment charges, and returned check charges are unlawful under 12 U.S.C. Section(s) 1463(g)(2) (Supp. IV 1992), a provision of the Home Owners' Loan Act, the federal statute governing lending charges by federal savings associations.

Ultimately, Household moved for judgment against the Amended Complaint on the grounds that: (1) having never incurred any of the challenged charges, Deffner lacked standing to bring her claims; and (2) Deffner's state law claims were preempted by federal law. The trial court granted Household's motion for judgment. Deffner argues on appeal that she has standing.

We hold Deffner lacked standing to bring the claims at issue. Deffner did not incur the charges she challenges, and our discussion of standing with respect to Bartlam, supra part III.A, applies equally to this case. *fn26 Deffner may not sue Household for charges that she neither paid nor incurred.

Furthermore, like Bartlam, Deffner lacks a statutory basis for her cause of action. Section 1463(g) of the Home Owners' Loan Act contains similar language to 12 U.S.C. Section(s) 85 and 86. *fn27 Section 1463(g) is not identical to Section(s) 85 and 86, but the only material difference between the sections weakens Deffner's argument. *fn28 As discussed, supra part III.A, Bartlam attempted to find a cause of action for unpaid fees in the "reserving" language of Section(s) 86. This language is not part of 12 U.S.C. Section(s) 1463(g)(2), which provides the exclusive remedy for violations of the usury provision of the Home Owner's Loan Act. The remedy provision of Section(s) 1463(g)(2) prohibits only "receiving" or "charging" a usurious rate of interest, which Household has not done. Thus Deffner cannot even make Bartlam's argument, which we rejected, that the statute is intended to cover contractual arrangements. Like Bartlam, Deffer has no cause of action and no standing.

We need not determine whether Deffner's state claims are substantively preempted by Section(s) 1463(g). *fn29 Since Deffner lacks standing to bring her federal claims, we remand this case to the district court with instructions to remand the state law issues to state court.

C.

Finally, the plaintiff in Szydlik v. Associates Nat'l Bank, No. 94-3216, argues that the district court erred in dismissing his case. Szydlik challenges returned check charges, late fees, and over-limit fees. He alleges that the district court improperly dismissed his case sua sponte and erred in determining that California law allowed the charges that Associates National Bank imposed. We will first address a preliminary procedural point, then assess standing issues, and finally reach the merits of certain of Szydlik's claims.

Szydlik presents a preliminary procedural argument, in which he contends that because Associates National Bank never filed a dispositive motion, the district court erred in dismissing his claims. The district court dismissed Szydlik's claims on April 12, 1994. Tompkins v. American General Financial Center, No. 92-375, slip op. at 1 (W.D. Pa. Apr. 12, 1994) ("April 12, 1994, Order"). In its April 12, 1994, Order, the district court referred to its Order of June 21, 1993, in which it had stated that "[any] defendants who have not yet filed a motion to dismiss are assumed to agree with the motions to dismiss and corresponding briefs already filed, unless the court is notified otherwise by July 2, 1993." Ament v. PNC Nat'l Bank, No. 92-244, slip op. at 3 (W.D. Pa. June 21, 1993) ("June 21, 1993, Order"). Szydlik argues the June 21, 1993, Order applies only to dispositive motions filed before that Order. Szydlik asserts that because no defendant filed a dispositive motion addressing the issues of California law relevant to Szydlik's claims prior to June 21, 1993, the district court's dismissal of his claim was sua sponte and improper.

The essence of this argument is that because Associates National Bank did not file a specific dispositive motion it was barred from benefitting from motions filed by other defendants. Szydlik's argument reads the district court's June 21, 1993, Order, which was based on Federal Rule of Civil Procedure 42(a), too narrowly. The district court sought to avoid repetitive briefing for issues common to the consolidated cases and gave clear notice of its intention to apply the defendants' dispositive motions to all of the cases, including Szydlik's. Hence, there is no merit to his preliminary point.

Next, we must consider standing. Szydlik does not allege that he ever incurred a return check charge, and therefore we hold that he lacks standing on that claim, based on the reasoning of our discussion of Bartlam v. Bank of America, No. 94-3217. See supra part III.A. Szydlik did incur both late fees and over-limit fees of fifteen dollars each, and we must therefore consider the merits of these claims. He contends that California law does not permit any other lender to assess these charges and that Associates National Bank's imposition of them is therefore usurious.

The district court disposed of Szydlik's late fee and over-limit fee claims on preliminary motion. Although we are hampered somewhat because the basis for the district court's dismissal of Szydlik's claims is unclear, Tompkins v. American General Financial Center, No. 92-375 (W.D. Pa. Apr. 12, 1994) (order of dismissal), we review the district court's grant of dismissal motions under a plenary standard. Moore v. Tartler, 986 F.2d 682, 685 (3d Cir. 1993).

We must first determine whether Szydlik's state law claims are substantively preempted by the National Bank Act. *fn30 Szydlik argues that the word "interest" as used in Section(s) 85 of the National Bank Act does not encompass the contested charges and that federal law therefore does not preempt state law in the present dispute. We disagree.

We note initially that ordinary preemption differs from complete preemption. Railway Labor, 858 F.2d at 942 (citing Caterpillar, Inc., 482 U.S. at 398). The former is a question of what substantive law -- federal or state -- should control a claim brought pursuant to state law. Krashna, 895 F.2d at 114 n.3; Hunter v. Greenwood Trust Co., 856 F. Supp. 207, 212 n.2 (D.N.J. 1992). As this court has held, "[s]tate courts are competent to determine whether state law has been preempted by federal law and they must be permitted to perform that function in cases brought before them, absent a Congressional intent to the contrary." Railway Labor, 858 F.2d at 942.

The question of when federal law preempts state law under the Supremacy Clause, U.S. Const. art. VI, cl. 2, is one of congressional intent. English v. General Elec. Co., 496 U.S. 72, 78-79 (1990). Preemption occurs in three circumstances: when Congress uses explicit statutory language to express its intent; when state law attempts to regulate conduct in an area Congress intended the federal government to occupy exclusively; and when state law actually conflicts with federal law. Id. at 79. The Court has noted, however, that

[b]y referring to these three categories, we should not be taken to mean that they are rigidly distinct. Indeed, field pre-emption may be understood as a species of conflict pre-emption: a state law that falls within a pre-empted field conflicts with Congress' intent (either express or plainly implied) to exclude state regulation. Nevertheless, because we previously have adverted to the three-category framework, we invoke and apply it here. Id. at 79 n.5.

The Supreme Court recently clarified the preemption inquiry further, noting that implied preemption can co-exist with an express preemption clause. Freightliner Corp. v. Myrick, __ U.S. __, 115 S. Ct. 1483, 1487 (1995). Our task of determining which category of preemption applies is made simple: lacking express language of preemption in Section(s) 85, we are left with field and conflict preemption, which the Supreme Court has made clear we need not worry about distinguishing. *fn31

Congress did not specifically define the term "interest" in these statutes. While we always start the task of interpretation with the plain meaning of a statute, the meaning here is ambiguous. Although Szydlik argues that "interest" can only apply to charges in the form of periodic percentage rates, we do not believe the term is either so limited in meaning or so self-defining. The Court of Appeals for the First Circuit has held that "interest" in Section(s) 521 of DIDA does not have a plain meaning limited to "numerical interest rates." Greenwood Trust, 971 F.2d at 824-25. The First Circuit's persuasive analysis is relevant to our inquiry because of the similarity between Section(s) 521 of DIDA and Section(s) 85 of the National Bank Act. Additionally, Webster's Dictionary defines "interest" as "the price paid for borrowing money generally expressed as a percentage of the amount borrowed paid in one year." Webster's Third New International Dictionary 1178 (1964) (emphasis added).

Szydlik contends that a plain meaning can be found in the common law definition of "interest." We do not agree. We agree with the court in Tikkanen v. Citibank (S.D.), N.A., 801 F. Supp. 270, 278 (D. Minn. 1992), which responded to a similar argument:

[Plaintiffs] rely on cases from a handful of jurisdictions to support the proposition that late fees cannot be considered interest under 'the common law,' as if there were a uniform law of usury applicable in all fifty states. . . . Usury statutes and the case law construing them vary from state to state; that variation is in fact the genesis of these actions.

Szydlik and the other plaintiffs in this case have relied upon similar authority, which we reject. Lacking a clear plain meaning of the term "interest," we turn to congressional purpose.

The legislative history of the National Bank Act is not especially helpful in establishing the exact scope Congress intended "interest" to have. Although Congress had considered establishing a uniform national rate of interest that the national banks could charge, it ultimately rejected the idea and designed a system "to place the national banks in each State on precisely the same footing with individuals and persons doing business in the State by its laws." Cong. Globe, 38th Cong., 1st Sess. 2126 (1864). The language on interest was designed to create a mechanism for national banks to be able to charge what state lenders could charge for loans, so that national banks would be immune from "unfriendly State legislation." Tiffany v. National Bank of Missouri, 85 U.S. (18 Wall.) 409, 412 (1874).

While instructive, the legislative history does not clearly establish the intended scope of "interest" in Section(s) 85, so we will consider the section's purpose. Section 85 authorizes a national bank to charge the interest allowed by the state where the bank is located to its customers around the country. Marquette Nat'l Bank v. First of Omaha Serv. Corp., 439 U.S. 299, 313-18 (1978). Known as the "exportation" principle, it allows a bank to impose interest charges allowed by the laws of its home state on out-of-state customers. Greenwood Trust, 971 F.2d at 827. For example, the exportation principle makes it lawful for a bank located outside of Pennsylvania to impose interest charges on cardholders in Pennsylvania if the bank's home state allows those charges. It does not matter if those charges are unlawful under Pennsylvania law as long as the charges are "interest" and thus within the scope of Section(s) 85 and 86.

Congress also designed Section(s) 85 to give national banks a potential advantage over state banks by allowing national banks to charge interest rates higher than state banks may charge, provided another lender in the state is permitted to charge that higher rate. Tiffany, 85 U.S. at 412-13. This "most favored lender" doctrine serves the congressional purposes of protecting national banks from "the hazard of unfriendly legislation by the States" and of promoting the notion that "National banks have been National favorites." Id. at 413; see also Fisher v. First Nat'l Bank, 548 F.2d 255, 259 (8th Cir. 1977) (explaining doctrine and exportation principle). The most favored lender doctrine's application to this case allows each defendant to charge a borrower any "interest" charge allowed to a lender in the defendant's home state.

The exportation principle and the most favored lender doctrine evince strong congressional encouragement of national banks' lending efforts and provide powerful tools for the national banks to expand their lending activities. The Supreme Court noted Congress' effort "to insure their taking the place of State banks." Tiffany, 85 U.S. at 413. We now must determine the appropriate definition of "interest" in order to effectuate these congressional goals.

Associates National Bank assessed Szydlik two late charges and two over-limit fees, one of each in January 1991 and one of each in October 1991. Szydlik alleges that neither late fees or over-limit fees are permissible under Pennsylvania law, where he resides. He claims these charges are not within Section(s) 85's definition of "interest," and therefore federal law (i.e., Section(s) 85, with its exportation principal and most favored lender doctrine) provides no authorization of the charges. Szydlik then argues that Section(s) 85 does not preempt state law with respect to these charges, and that Associates National Bank has to defend the state causes of action on the merits. Associates responds that the charges are "interest," that Section(s) 85 authorizes the charges as long as any lender in the bank's home state can charge them, and that contrary state law must yield under the Supremacy Clause.

Szydlik asserts that "interest" has at least one of three characteristics: it is based on the amount of the unpaid loan balance; it accrues and is measurable over time; or the lender requires the charge as consideration for the loan. Interest cannot, Szydlik maintains, be a contingent charge, such as "penalty" charges based on the borrower's default. *fn32

Szydlik would limit the definition of "interest" to charges in the form of periodic percentage rates. Were his definition to prevail, Congress' clear purpose in enacting Section(s) 85 would be undermined. As we have explained, "Congress intended to facilitate . . . a national banking system." Marquette, 439 U.S. at 314-15 (quotations omitted). Implicit in a national banking system was the possibility that it would "impair the ability of States to enact effective usury laws." Id. at 318. The most favored lender doctrine and the exportation principle apply to all of a national bank's charges for the use of its money, and the term "interest" must have a correspondingly broad reach in order to assure parity between national banks and other state lenders. The Supreme Court formulated a useful definition in Brown v. Hiatt, 82 U.S. (15 Wall.) 177, 185 (1873), holding that interest is "the compensation . . . for the use or forbearance of money, or as damages for its detention." This definition comports with the purposes of Section(s) 85.

A narrower definition would allow states to permit certain favored lenders to assess these charges while denying national banks the same privilege. As Amici for the banks argued in their brief, applying Section 85 only to periodic percentage rates "would lead to an unworkable and undesirable hodgepodge of fee limits, and periodic rate provisions, under the laws of both the bank's state and the borrower's state." States often allow lenders to utilize a variety of credit card charges as an integrated package. The Supreme Court noted this point in Marquette, 439 U.S. at 302-03, in which it discussed a Nebraska law that set higher percentage rates than did Minnesota law. The Court observed, "To compensate for the reduced [annual rate of] interest, Minnesota law permits banks to charge annual fees of up to $15 for the privilege of using a bank credit card." Id. Some states could, for example, decide to limit lenders' use of late fees if those lenders are also imposing certain periodic rates. Szydlik's interpretation could therefore result in a borrower in one of these states being subject to the periodic percentage rate limits but not to the limits on other loan charges as well.

Other courts have held Section(s) 85 applicable to a broad range of charges. See, e.g., Citizens' Nat'l Bank v. Donnell, 195 U.S. 369, 373-74 (1904) (penalty charges for late payment); Greenwood Trust, 971 F.2d at 831 (late fees); Fisher, 548 F.2d at 258-61 (cash advance fee); Northway Lanes v. Hackley Union Nat'l Bank & Trust Co., 464 F.2d 855, 863 (6th Cir. 1972) (closing costs); Cronkleton v. Hall, 66 F.2d 384, 385, 387 (8th Cir.) (commission paid by lender), cert. denied, 290 U.S. 685 (1933). The treatment given this issue by state tribunals is also persuasive. Both the Supreme Court of California and the Supreme Court of Colorado have interpreted Section(s) 85 to apply to credit card late charges in cases whose facts parallel the consolidated actions before us. Smiley v. Citibank (S.D.), N.A., 900 P.2d 690 (Cal. 1995); Copeland v. MBNA America Bank, N.A., No. 94SC409, ___ P.2d ___, 1995 Colo. LEXIS 743 (Colo. Nov. 20, 1995); but see Hunter v. Greenwood Trust Co., No. A-103- 94, ___ A.2d ___ (N.J. Nov. 28, 1995) (holding that term "interest" in 85 does not include late-payment fees). These precedents demonstrate the significant weight of authority that comports with our interpretation, and they recognize that various loan charges often are substantively similar in their economic function to the periodic percentage rates casually termed "interest." Likewise, the Office of the Comptroller of the Currency, which has the responsibility to oversee "the execution of all laws passed by Congress relating to the issue and regulation of a national currency" (including the National Bank Act), 12 U.S.C. Section(s) 1 (1988), has interpreted "interest" broadly *fn33 in interpretive rulings and opinion letters. *fn34

In a February 17, 1995, letter from the OCC Chief Counsel, the OCC reconfirmed its position regarding many of the types of fees at issue here. Letter from Julie L. Williams, OCC Chief Counsel, to John L. Douglas, Alston & Bird (Feb. 17, 1995). The OCC letter discusses annual fees, late charges, and over-limit charges. Annual fees must fit within the definition of interest, the OCC states, because they "compensate the bank for other costs and risks associated with establishing and maintaining the account." Id. at 7. These fees are "akin to commissions [or] closing costs," which are considered within the scope of Section(s) 85. Id. The OCC argues that late charges are likewise a form of interest, because they are compensation for the increased lending costs and risks associated with borrowers who pay late. Id. at 9. In addition, the OCC maintains that over-limit charges are compensation for the increased credit risk associated with excess draws upon the borrower's credit. Id. at 11. This interpretation accords with our view.

Congress has written a statute to allow national banks to assess charges associated with their loans that comply with the law of the bank's home state, without regard to the charges permitted by other states in which the banks may make loans. The definition of interest must be broad to accommodate Congress' effort. *fn35 Indeed, the weight of authority is overwhelmingly on the side of an expansive definition of interest for purposes of Section(s) 85. We must next determine whether the specific charges at issue fit within this broad definition.

We conclude that over-credit limit fees and late fees constitute interest, because they provide mechanisms to compensate the lender for the increased lending risk associated with people who incur these kinds of charges. As such, they are compensation for the "use or forbearance of money, or . . . damages for its detention." Brown, 82 U.S. at 185. We hold that the term "interest" in Section(s) 85 of the National Bank Act encompasses the fees charged by Associates National Bank in this case. See Smiley v. Citibank (S.D.), N.A., 900 P.2d 690 (Cal. 1995) (reaching same conclusion).

Under the most favored lender doctrine, however, Associates National Bank may only assess late charges and over-limit fees if they are permitted of a lender in California. We therefore turn to California law.

Effective January 1, 1995, California permits credit card issuers to charge a graduated late fee of $7 where the minimum payment due is not paid within five days after the due date, $10 where the minimum payment due is not paid within 10 days after the due date, and $15 dollars where the minimum payment due is not paid within 15 days after the due date. Cal. Fin. Code Section(s) 4001(a). Once the consumer has incurred two late payment fees during the preceding year, the monthly late fee can be no greater than $10 where the minimum payment is made within five days of the due date. Id. The statute also authorizes a $10 over-credit fee where the consumer exceeds his allowable balance by the lesser of $500 or 120%. Id.

While this statute clarifies the current state of California law, it leaves open the validity of pre-1995 late fees and over-credit charges. This question was not adequately briefed in the district court, and we will remand for its consideration. In doing so, the district court should also consider whether Section(s) 4001 could be applied retroactively to validate the late fees and over-credit charges to the degree permitted by the statute. Accordingly, we will remand Szydlik for these determinations.

IV.

We shall reverse the decisions of the district courts asserting complete preemption jurisdiction in the non-California lender cases, with instructions to remand to the state courts. We shall affirm the district court on all other points except its dismissal of the claims in Szydlik v. Associates Nat'l Bank, No. 94-3216, regarding late charges and over-limit fees charged by Associates National Bank. We will reverse that portion of the district court's dismissal and remand for further proceedings consistent with this opinion.

SCIRICA, Circuit Judge, dissenting in part and concurring in part.

Under the majority's interpretation that the complete preemption doctrine does not provide federal jurisdiction, the courts of each state will decide the extent to which national banks are governed by the usury provisions of the National Bank Act. Because Congress passed the National Bank Act in 1864, we must divine congressional intent from a distance of more than one hundred years. Nevertheless the unique history of the National Bank Act demonstrates Congress could not have intended the result reached by the majority in this case. *fn36 Moreover, the majority's holding creates a conflict with the Court of Appeals for the Eighth Circuit, which decided in M. Nahas & Co. v. First Nat'l Bank, 930 F.2d 608, 612 (8th Cir. 1991), that the complete preemption doctrine applies to claims under section 30 of the National Bank Act, 12 U.S.C. Section(s) 85, 86 (1994). Because I believe Congress intended a uniform federal construction of the Act, and the majority's holding will subject the national banking system to the vagaries of the different states' interpretations, I respectfully dissent. Compare Sherman v. Citibank (S.D.) N.A., No. A-102 (N.J. Nov. 28, 1995) (term "interest" as used in Section(s) 85 of the National Bank Act does not include late payment fees, and the National Bank Act does not preempt application of state law); Mazaika v. Bank One, Columbus, N.A., 653 A.2d 640 (Pa. Super. 1994) (same), appeal granted, 659 A.2d 557 (Pa. 1995); with Copeland v. MBNA America Bank, N.A., No. 94SC409 (Colo. Nov. 20, 1995) (term "interest" as used in Section(s) 85 includes late payment fees, and National Bank Act preempts application of state law); Smiley v. Citbank (S.D.), N.A., 900 P.2d 690 (Cal. 1995) (same).

I.

The existence of federal question jurisdiction in this case turns on the application of the complete preemption doctrine. The Supreme Court created this doctrine as a corollary to the "well-pleaded complaint" rule to acknowledge that "Congress may so completely pre-empt a particular area that any civil complaint raising this select group of claims is necessarily federal in character." Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63-64 (1987). When the doctrine applies, "any complaint that comes within the scope of the federal cause of action necessarily 'arises under' federal law," Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 24 (1983), for purposes of removal based on federal question jurisdiction. *fn37

We have addressed the complete preemption doctrine in several cases and have established a two-part test to determine when an area of law is completely preempted. First, the federal statute at issue must contain "civil enforcement provisions within the scope of which the plaintiff's state claim falls." Railway Labor Executives Ass'n v. Pittsburgh & Lake Erie R.R. Co., 858 F.2d 936, 942 (3d Cir. 1988) (citing Franchise Tax, 463 U.S. at 24, 26). Second, there must be "affirmative evidence of a congressional intent to permit removal despite the plaintiff's exclusive reliance on state law." Allstate Ins. Co. v. 65 Sec. Plan, 879 F.2d 90, 93 (3d Cir. 1989).

A.

As the majority notes, the first prong of the complete preemption test requires a comparison between the federal statute's enforcement provisions and the nature of the plaintiffs' claims. We must ask if the National Bank Act's and DIDA's civil enforcement provisions, 12 U.S.C. Section(s) 86 and 1831d, govern the same interests plaintiffs seek to vindicate in their suits. See Allstate Ins., 879 F.2d at 93-94.

Section 86 of the National Bank Act, the civil enforcement provision for recovery of excessive interest and impermissible loan fees charged by national banks, is the exclusive remedy for borrowers to enforce the terms of Section(s) 85 of the National Bank Act. *fn38 M. Nahas, 930 F.2d at 610; McCollum v. Hamilton Nat'l Bank, 303 U.S. 245, 248 (1938); Evans v. National Bank, 251 U.S. 108, 109, 114 (1919); Farmers' & Mechanics' Nat'l Bank v. Dearing, 91 U.S. 29, 34-35 (1875). Section 85 establishes the rates of interest a national bank can charge its customers.

Section 521 of DIDA, the civil enforcement provision for individuals charged excessive interest by federally insured state banks, is identical to Section(s) 86 in all material respects. *fn39 Cf. Greenwood Trust Co. v. Massachusetts, 971 F.2d 818, 826 & n.7 (1st Cir. 1992) (noting the identity of language between the first part of Section(s) 521 of DIDA and 85 of the National Bank Act), cert. denied, 113 S. Ct. 974 (1993). Congress wrote Section(s) 521 to have the same scope as Section(s) 86 and to provide redress for the same type of conduct.

The interests the cardholders seek to vindicate are precisely those protected by both federal statutes. Plaintiffs' state law causes of action rest on allegations that national banks and federally insured state-chartered banks charged impermissible fees in connection with credit card loans. Section 86 of the National Bank Act and Section(s) 521 of DIDA govern recovery of impermissible loan fees from such banks. Because the redress sought by the plaintiffs falls within the scope of the enforcement provisions of the federal statutes, the first prong of the test for complete preemption is satisfied.

B.

Under the second prong of the complete preemption analysis, we must examine congressional intent. Congress has broad authority to control the jurisdiction of the lower federal courts. See Kline v. Burke Constr. Co., 260 U.S. 226, 233-34 (1922) (observing that, aside from the Supreme Court, "[e]very other court created by the general government derives its jurisdiction wholly from the authority of Congress"). Accordingly, congressional intent is the "touchstone" for an analysis of the scope of removal jurisdiction. Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 66 (1987). The existence of removal jurisdiction in a particular case turns on whether Congress has granted it.

We have suggested that complete preemption requires "affirmative evidence of a congressional intent to permit removal despite the plaintiff's exclusive reliance on state law." Allstate Ins., 879 F.2d at 93; see also Goepel v. National Postal Mail Handlers Union, 36 F.3d 306, 311 (3d Cir. 1994) (formulating the requirement as one of clear congressional intent), cert. denied, 115 S. Ct. 1691 (1995); Krashna v. Oliver Realty, Inc., 895 F.2d 111, 114 (3d Cir. 1990) (same); Railway Labor, 858 F.2d at 942 (same). But because the claim of complete preemption in each of our prior cases has foundered on the first prong of our test, we have never had occasion to elaborate upon the requirements of the second prong. See Goepel, 36 F.3d at 312-13; Krashna, 895 F.2d at 115; Allstate Ins., 879 F.2d at 94; Railway Labor, 858 F.2d at 942. Thus, while we have described the second prong of the test in dictum, until today we have never issued a holding based upon it.

At oral argument, defendants suggested that the test for complete preemption should focus solely on whether Congress has created an exclusive federal remedy, and that our precedent requiring a showing of specific Congressional intent to allow removal should be abandoned. Defendants are correct that the Supreme Court's holdings in Avco Corp. v. Aero Lodge No. 735, 390 U.S. 557 (1968), and Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1 (1983), cannot be explained under our two part test. Avco Corp. focused solely on the preemption of state law by Section(s) 301 of the LMRA and concluded on that basis that "[r]emoval is but one aspect of the primacy of the federal judiciary in deciding questions of federal law." 390 U.S. at 560. It did not ask whether Congress had specifically intended to allow removal of Section(s) 301 actions to federal court. Likewise, in Franchise Tax, the Court, without considering the lack of specific congressional intent to allow removal, found no complete preemption because Section(s) 514(b)(2)(A) of ERISA did not provide an exclusive federal remedy. 463 U.S. at 25-26.

The Supreme Court has addressed the scope of the congressional intent requirement only in Metropolitan Life, 481 U.S. at 64-66, and there, only in general terms. The courts of appeals have been left to determine the necessary quantum of congressional intent. Not surprisingly, the circuits have taken different approaches. Compare Rosciszewski v. Arete Assocs., 1 F.3d 225, 232-33 (4th Cir. 1993) (finding congressional intent to have copyright litigation take place in federal court from grant of exclusive jurisdiction); M. Nahas, 930 F.2d at 612 (finding congressional intent for complete preemption based on Congress' creation of an exclusive federal remedy in Section(s) 86 of the National Bank Act); Trans World Airlines v. Mattox, 897 F.2d 773, 787 (5th Cir.) (finding congressional intent to create complete preemption based on Congress' desire to maintain uniformity in the law and to "avoid the confusion and burdens that would result if interstate and international airlines were required to respond to standards of individual states"), cert. denied, 498 U.S. 926 (1990); with Hurt v. Dow Chemical Co., 963 F.2d 1142, 1145 (8th Cir. 1992) (holding no complete preemption where the plaintiff would not have had a cause of action under FIFRA, especially when there is no other indication of Congress' intent to create complete preemption); Aaron v. National Union Fire Ins. Co., 876 F.2d 1157, 1165-66 (5th Cir. 1989) ("[T]he parties have not pointed to, nor have we found, any expression in the statute or the legislative history of congressional intent to apply something similar to the Avco exception."), cert. denied, 493 U.S. 1074 (1990). *fn40

Of course the clearest case of a satisfactory indication of congressional intent is where Congress provides jurisdictional language like that in Section(s) 301 of the LMRA. See Metropolitan Life, 481 U.S. at 65 (finding complete preemption because the jurisdictional subsection of ERISA's civil enforcement provision closely parallels Section(s) 301's language). *fn41 But the Court made clear that ERISA provided unusually clear evidence of congressional intent, stating, "[n]o more specific reference to the Avco rule can be expected," id. at 66, and "[i]n the absence of explicit direction from Congress, this question would be a close one." Id. at 64. These statements leave open the possibility that there are instances where congressional intent is less clear but nevertheless sufficient to support a finding of complete preemption.

Congress wrote the National Bank Act in 1864, long before the "well-pleaded complaint" rule and the complete preemption doctrine were enunciated. *fn42 We could not expect the Congress which enacted the National Bank Act to have discussed the federal question jurisdiction or removal implications of Section(s) 85 and 86, since neither general federal question jurisdiction nor general removal power existed in 1864. *fn43 Under these circumstances, the majority's requirement of an explicit showing of congressional intent to allow removal is too strict. Instead we should look to less direct evidence of what Congress intended regarding the role of federal courts in enforcing the National Bank Act. *fn44 See Trans World Airlines v. Mattox, 897 F.2d at 787 (finding complete preemption based on Congress' desire to maintain uniformity in the law).

1.

Accordingly, I believe it is useful to place the current dispute within the proper historical context. Congress passed the National Bank Act of 1863, 12 Stat. 665, and replaced it with the National Bank Act of 1864, 13 Stat. 99, in the midst of the exigencies imposed by the Civil War. The statute created the current system of national banks and established the limitations on interest charges that we must construe here.

A thorough understanding of the history of our banking system is incomplete without reference to the earlier debates over the First and Second Banks of the United States of America. Federalists in the young republic were in favor of a national bank and perceived its utility as a source of capital both for the new government and for the general economy. See, e.g., Alexander Hamilton, Treasury Report on a National Bank, (Dec. 13, 1790), reprinted in 1 Documentary History of Banking and Currency in the United States 230, 231-33 (Herman E. Krooss ed., 1969). States' rights advocates and Republicans, however, saw the national bank as a threat to liberty and as an aggrandizement of federal power beyond the boundaries set by the Constitution. Thomas Jefferson, Opinion on the Constitutionality of a National Bank (Feb. 15, 1791), reprinted in The Portable Thomas Jefferson 261, 262 (Merrill D. Peterson ed., 1975).

The Federalists, led by Alexander Hamilton, won the opening round of this debate, and the First Bank of the United States was given a twenty-year charter beginning in 1791. Bank Act of 1791, Section(s) 3, 1 Stat. 191, 192. The bank was rechartered in 1816 as the Second Bank of the United States, again for a twenty-year period. Bank Act of 1816, Section(s) 7, 3 Stat. 266, 269. To the extent that the power of Congress to establish the bank had been doubted, those doubts were erased in 1819, when the Supreme Court firmly established the constitutionality of the national bank in McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316 (1819). In McCulloch the Supreme Court also enunciated a strong view of the federal government, observing that its supremacy over the states is a "great principle" which "entirely pervades the constitution." Id. at 426.

Congress again passed a bill to recharter the bank in July of 1832, but Andrew Jackson vetoed it. John J. Knox, A History of Banking in the United States 69 (Augustus M. Kelley pub., 1969) (1903). His main argument against the bank was that it represented an unreasonable expansion of the federal government and monied interests at the expense of local interests. Bray Hammond, Banks and Politics in America from the Revolution to the Civil War 405-06 (1957) (hereinafter Banks and Politics). The charter for the bank expired in 1836, and the federal government began to remove its deposits from the banks. Knox, supra, at 70-71.

After the passage of the Independent Treasury Act of 1846, 9 Stat. 59, the federal government kept substantially all of its money in its own vaults. Bray Hammond, Sovereignty and an Empty Purse: Banks and Politics in the Civil War 18-19 (1970) (hereinafter Empty Purse). This system was still in place at the start of the Civil War. Id. at 20. It was a system which "had the . . . effect of stunting federal powers and . . . rested on the fallacies that government lay outside the economy, that banking was not a monetary function, and that the federal sovereignty had no constitutional responsibility for it." Id. at 22.

As secession and the Civil War challenged the national government's survival, the inadequacies of the Independent Treasury system were placed in stark relief. Id. at 24. By 1861, a large number of banks authorized by individual states were issuing bank notes for circulation. Id. at 291. This state system of issuing banks was barely functional, lacking reliability and uniformity. The Union's military setbacks, combined with dire need for more stable financing, led to a movement to establish a uniform national currency, which culminated in the passage of the National Bank Act of 1863. Id. at 296; The National Bank Act of 1863, 12 Stat. 665. This act was replaced by the National Bank Act of 1864, 13 Stat. 99, but the Act of 1864 left the principal provisions of the first law substantially in place.

The National Bank Act thus represents the culmination of the debate regarding the proper role of the federal government in the banking system. It has been suggested that the Act created a "revolutionary change . . . in the relative powers of the states and the federal government." Empty Purse, supra, at 333. This may overstate the case, especially in comparison with the impact wrought by the Reconstruction Amendments. But it is clear that the National Bank Act was a significant exercise of congressional authority, intended by Congress to alter federal-state relations.

The debate on the passage of the Act of 1863 illuminates the views of some members of Congress. Senator Sherman, sponsor of the bill, argued that a motive for its passage was to "promote a sentiment of nationality." Cong. Globe, 37th Cong., 3d Sess. 843 (1863). He also suggested the new currency and system for establishing it "if it has a fair trial, a fair experiment, will gradually absorb all the State banks, without deranging the currency of the country or destroying the value of the property of stockholders in banks." Id.

The national currency system was designed to cure the worst ills of the state banks, but did not eliminate the state banks. Indeed, at the time, there was considerable doubt that Congress had the power to regulate state banks directly, let alone to eliminate them. Henry N. Butler & Jonathan R. Macey, The Myth of Competition in the Dual Banking System, 73 Cornell L. Rev. 677, 682 (1988). For example, during a discussion of a proposed amendment to the National Bank Act that would have barred state banks from issuing any bank note not already in circulation, Senator Sherman asked, "[W]here is the constitutional power to do it?" Cong. Globe, 38th Cong., 1st Sess. 2175 (1864).

But it was clear Congress had the authority to charter national banks. McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316 (1819). Even without eliminating state banks by statute, Congress thought they would disappear as the state banks exchanged their state charters for federal charters. Congress believed that "a dual banking system would exist only during a brief transition period." Butler & Macey, supra, at 681; see also John W. Million, The Debate on the National Bank Act of 1863, 2 J. Pol. Econ. 251, 267 (1894) ("Nothing can be more obvious from the debates than that the national system was to supersede the system of state banks."). In the debates over the National Bank Act, members of Congress frequently expressed their belief that the state banks would disappear. See, e.g., Cong. Globe, 38th Cong., 1st Sess. 2145 (1864) (Senator Sherman remarking that the state banks would be absorbed); id. at 1869 (Senator Wilson remarking that a dual system of state and national banks should not continue); id. at 1892 (Senator Johnson stating that the national banking system was designed to supplant the state system). When in fact most state banks did not seek to convert to nationally chartered banks, Congress imposed a punitive tax on state bank notes in an effort to ruin the state banking system. Butler & Macey, supra, at 681. This effort failed, however, as the state banks continued to thrive. Empty Purse, supra, at 297.

Congress enacted the provision on usury in section 30 of the National Bank Act of 1864, 12 U.S.C. Section(s) 85, 86, against this backdrop. The historical context demonstrates that Congress perceived the enactment of the National Bank Act as essential to the survival of the republic and believed it equally essential to establish a national banking system that was independent of potentially destructive state impulses. See, e.g., Cong. Globe, 38th Cong., 1st Sess. 1451 (1864) (Representative Hooper, remarking "I believe the existence of the nation is at stake upon this issue; that the present necessity requires the use of every legitimate means to sustain the credit of the Government . . . I appeal to the members of the House, and I ask them if they can excuse themselves . . . if they sacrifice these great interests . . . to the comparatively petty interests of local banking.").

2.

The Supreme Court has described Congress' intent in passing Section(s) 85 and 86 of the National Bank Act. In Tiffany v. National Bank, 85 U.S. (18 Wall.) 409, 412-13 (1874), the Court observed that Congress passed the interest provisions "to give [national banks] a firm footing in the different States where they might be located." Id. at 412. The power to impose the same interest charges that state institutions were allowed to impose "was considered indispensable to protect [national banks] against possible unfriendly State legislation." Id. Congress did not intend, the Court continued, "to expose [national banks] to the hazard of unfriendly legislation by the States, or to ruinous competition with State banks." Id. at 413. *fn45 The Supreme Court made clear the congressional purpose was to enable national banks to resist potential state parochialism.

Congressional intent can also be gleaned from the fact that Section(s) 86 provides the exclusive remedy for usury claims against national banks. *fn46 Evans, 251 U.S. at 109, 114; Dearing, 91 U.S. at 34-35. Congress intended through the creation of this exclusive federal remedy to "prevent the application of overly-punitive state law usury penalties against national banks." M. Nahas, 930 F.2d at 612. Further, the remedy for usury in Section(s) 86 "preempts the field and leaves no room for varying state penalties." First Nat'l Bank v. Nowlin, 509 F.2d 872, 881 (8th Cir. 1975); see also McCollum, 303 U.S. at 247-48 (holding the National Bank Act sections completely define the right to recover penalties for usurious interest); Barnet v. National Bank, 98 U.S. 555, 558 (1879) (observing the federal penalty provisions for usury occupy the field to the exclusion of state usury statutes when national banks are involved).

3.

As I have noted, Congress did not seek immediately to eliminate the state banking system, but rather believed the state banks would voluntarily seek national charters. See supra part I.B.1. Members of Congress anticipated state banks would disappear as national bank charters became universal. The Congress that enacted the National Bank Act did not expect competition between state and federal law over usury claims against national banks because those claims ultimately were to be governed exclusively by federal law. See, e.g., Dearing, 91 U.S. at 35 ("In any view that can be taken of the thirtieth section, the power to supplement it by State legislation is conferred neither expressly nor by implication.").

All of this evidence demonstrates that Congress intended to have usury claims against national banks governed by a body of federal law which the federal courts would apply. Unlike the standard preemption defense case where there is no removal jurisdiction because the case is really a state case with a federal defense, here we are faced with "a federal case in state wrapping paper." Graf v. Elgin, J. & E. R. Co., 790 F.2d at 1344. *fn47 Accordingly, the claims at issue must arise under federal rather than state law, and removal is proper.

An analysis of Section(s) 521 of DIDA leads to the same result. The particular historical context I find persuasive for the National Bank Act does not apply to DIDA, which was passed in 1980. But I agree with the Court of Appeals for the First Circuit, which noted, "[t]he historical record clearly requires a court to read the parallel provisions of DIDA and the Bank Act in pari materia." Greenwood Trust, 971 F.2d at 827. Section 521 of DIDA was specifically intended to have congruent scope with the National Bank Act with respect to the coverage of Section(s) 85. Id. In order to effectuate this purpose, we must give equivalent jurisdictional reach to the two sections and their civil enforcement provisions. Accord Hill v. Chemical Bank, 799 F. Supp. 948, 952 (D. Minn. 1992) (finding complete preemption in Section(s) 521 of DIDA).

Removal jurisdiction is generally to be construed narrowly, see La Chemise Lacoste v. Alligator Co., 506 F.2d 339, 344 (3d Cir. 1974), cert. denied, 421 U.S. 937 (1975), and application of the complete preemption doctrine should be carefully circumscribed, Railway Labor, 858 F.2d at 940. But I am persuaded that complete preemption is appropriate because of the unique combination of the statute's history and the strong congressional desire for uniform treatment of national banks and of federally insured state-chartered banks. Tiffany, 85 U.S. at 412. I believe the district court properly exercised its removal jurisdiction over these cases. Accord M. Nahas, 930 F.2d at 612; Watson v. First Union Nat'l Bank, 837 F. Supp. 146, 149 (D.S.C. 1993). But see Copeland v. MBNA America, N.A., 820 F. Supp. 537, 541 (D. Colo. 1993) (finding no complete preemption in Section(s) 85 and 86 of the National Bank Act); Donald v. Golden 1 Credit Union, 839 F. Supp. 1394, 1403 (E.D. Cal. 1993) (finding no complete preemption in Section(s) 523 of DIDA).

II.

I join part III of the majority opinion, but because I do not agree with the majority's conclusion in part II that jurisdiction is improper under the complete preemption doctrine, I respectfully dissent.


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