Are Credit-Card Late Fees “Interest”? Delineating the Preemptive Reach of Section 85 of the National Bank Act of 1864 and Section 521 of the Depositary Institutions Deregulation and Monetary Control Act of 1980

This Note argues that neither section 85 of the NBA nor section 521 of the DIDA preempts state consumer-credit-protection laws regulating late fees on credit-card transactions. Part I discusses the three approaches that the Supreme Court has devised and used over the years to determine when a federal law preempts state law: express preemption, implied preemption, and conflict preemption. Part II applies express preemption analysis and asserts that the ordinary meaning of DIDA section 521’s express preemption language does not evince Congress’s intent to preempt state prohibitions of late fees. Part III applies implied preemption analysis and argues that neither NBA section 85 nor DIDA section 521 impliedly preempts state laws regulating late fees because Congress did not indicate a clear and manifest purpose to preempt the entire field of consumer-credit protection. Finally, Part IV applies conflict preemption analysis and argues that sustaining state law provisions governing late fees, which are imposed only on contingent occasions of borrower default, does not conflict with the congressional objective in enacting NBA section 85 and DIDA section 521– achieving lender parity.