A federal judge for the Northern District of Illinois has extended a preliminary injunction against enforcement of the Illinois Interchange Fee Prohibition Act (IFPA) to out-of-state state-chartered banks, following the judge’s request for supplemental briefing on the issue. The order recognizes that “forcing out-of-state banks to comply with the IFPA would run afoul” of the Riegle–Neal Interstate Banking and Branching Efficiency Act. However, the order did not extend the preliminary injunction to credit unions.
This order follows the judge’s decision from last December issuing a preliminary injunction against enforcement of the IFPA for national banks and federal savings associations. The judge’s two preliminary injunction orders do not extend the preliminary injunction to credit unions, leaving the IFPA in effect for: (1) federally- and state-chartered credit unions, (2) Illinois-chartered banks and savings banks, and (3) card networks.
A status hearing has been set for March 6, 2025.
The IBA issued the following statement with our co-plaintiffs:
“We welcome Judge Kendall’s decision to extend the preliminary injunction to out of state banks, and the co-plaintiffs will be carefully reviewing the ruling with regard to credit unions to consider next steps. Today’s ruling illustrates the fundamental flaws of this misguided state law that will inflict chaos on all participants in the Illinois payments system and the customers they serve. We will continue our efforts to ensure that all consumers, businesses and financial institutions are spared the mayhem IFPA will trigger.”