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7th Circuit affirms permanent injunction

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The 7th Circuit Court of Appeals upheld an injunction preventing the application of Indiana's Uniform Consumer Credit Code to an Illinois company because it violates the commerce clause of the U.S. Constitution.

In Midwest Title Loans Inc. v. David H. Mills, Director of the Indiana Department of Financial Institutions,  No. 09-2083, the state appealed the permanent injunction entered by the U.S. District judge in Indiana's Southern District against applying Indiana's UCCC against Midwest Title Loans, which is a "car title lender." Midwest had offices only in Illinois but had many Indiana residents travel to the state in order to obtain a loan. Midwest advertised in Indiana but stopped once it learned about the "territorial application" provision added to the Indiana UCCC in 2007. The provision says if an Indiana resident enters into a consumer sale, loan or lease with a creditor in another state and the creditor advertises in Indiana, the lender is subject to the code. That would require a license from Indiana to make consumer loans and would subject the company to restrictions on annual interest rates it can charge. The goal is to protect residents from predatory lending.

The 7th Circuit judges, who included U.S. District Judge Samuel Der-Yeghiayan of the Northern District of Illinois sitting by designation, agreed with the District Court's injunction. They likened the instant case to that of Healy v. Beer Institute, 491 U.S. 324, 337 (1989), and a hypothetical case of involving Indiana and out-of state casinos to rule the application of the state's UCCC to Midwest violates the commerce clause of the federal Constitution.

In Healy, Connecticut passed a "price affirmation" law that required brewers to commit that the prices they charged for beer in Connecticut wouldn't be any higher than the lowest prices charged in a bordering state. The U.S. Supreme Court invalidated the law because Connecticut would be regulating prices in another state, albeit indirectly.

The Circuit judges also used the hypothetical of Indiana banning casinos because of massive gambling problems but requiring out-of-state casinos to obtain Indiana licenses that would limit a Hoosier to gambling no more than $10 per day.

"A state law of that kind, however well intentioned and genuinely beneficial to the state imposing it, would burden interstate commerce by restricting travel and a firm's ability to deal with residents of a different state, even though the law treated out-of-state businesses no worse (in our example, even slightly better) than businesses located in the state," wrote Judge Richard Posner.

Allowing Indiana to apply its law against title loans when its residents obtain them in a different state that has a different law would arbitrarily exalt the public policy of one state over the other, he continued.

All of the commercial activity involved with the loans happened in Illinois - the offices are located there, car keys handed over there, and checks were drawn and could be cashed there. The contract was made in Illinois, and that is enough to show that the territorial-application provision violates the commerce clause, wrote the judge.

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  1. wow is this a bunch of bs! i know the facts!

  2. MCBA .... time for a new release about your entire membership (or is it just the alter ego) being "saddened and disappointed" in the failure to lynch a police officer protecting himself in the line of duty. But this time against Eric Holder and the Federal Bureau of Investigation: "WASHINGTON — Justice Department lawyers will recommend that no civil rights charges be brought against the police officer who fatally shot an unarmed teenager in Ferguson, Mo., after an F.B.I. investigation found no evidence to support charges, law enforcement officials said Wednesday." http://www.nytimes.com/2015/01/22/us/justice-department-ferguson-civil-rights-darren-wilson.html?ref=us&_r=0

  3. Dr wail asfour lives 3 hours from the hospital,where if he gets an emergency at least he needs three hours,while even if he is on call he should be in a location where it gives him max 10 minutes to be beside the patient,they get paid double on their on call days ,where look how they handle it,so if the death of the patient occurs on weekend and these doctors still repeat same pattern such issue should be raised,they should be closer to the patient.on other hand if all the death occured on the absence of the Dr and the nurses handle it,the nurses should get trained how to function appearntly they not that good,if the Dr lives 3 hours far from the hospital on his call days he should sleep in the hospital

  4. It's a capital offense...one for you Latin scholars..

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