Judge dismisses FOM lawsuit against Nebraska credit union
A judge has dismissed a lawsuit against MembersOwn Credit Union in Lincoln, Neb., regarding its field-of-membership expansion last year.
The Nebraska Bankers Association and the Nebraska Independent Community Bankers sued after the $100 million-asset credit union successfully added eight counties to its field of membership.
District Court of Lancaster County Judge Andrew Jacobsen dismissed the case last week, according to a press release on Monday from the Nebraska Credit Union League. The banking groups can appeal the decision.
“We are extremely pleased with the court’s ruling in favor of MembersOwn Credit Union,” Scott Sullivan, president and CEO of the Nebraska Credit Union League, said in the press release. He added that he believes the decision will result in more Nebraskans having access to products and services from the state’s CUs.
A spokeswoman for MembersOwn said the credit union could now "confidently serve our new counties." She noted that half of those counties don't have a credit union option so the institution was "thrilled to offer that."
J. Eric Hallman, president and CEO of the NICB, said he was “disappointed” with the decision and the group was reviewing its options. The Nebraska Bankers Association didn’t immediately respond to a request for comment.
MembersOwn initially applied to the state’s Department of Banking and Finance to expand its membership to 11 additional counties in September 2018, according to the league press release. A month later the banking trade groups wrote letters opposing the application.
In January 2019, the DBF held a nine-hour hearing on the issue that included attorneys from the banking associations and MembersOwn.
Finally, in May the department granted MembersOwn the ability to serve eight of the requested 11 counties. That same month the banking groups sued the credit union and subsequently amended the complaint in June to include the Nebraska Department of Banking and Finance.
Last year Nebraska credit unions battled a proposed bill that would have required state regulators to notify banks when a credit union applied to extend its field of membership under certain circumstances. That bill was listed as pending in committee in a September summary of the legislative session from the summer.