Credit Card Late Fee Litigation

ABA Position

On March 5, 2024, CFPB released its final rule on credit card late fees. The final rule reduces the late fee safe harbor to $8 and eliminates automatic annual inflation adjustments for issuers subject to the reduced safe harbor amount. The $8 safe harbor only applies to issuers with 1 million or more open accounts. On March 7, 2024, ABA and its co-plaintiffs (ABA) sued CFPB seeking a preliminary, arguing the final rule: (1) violates the CARD Act by preventing issuers from collecting reasonable and proportional late fee; (2) is arbitrary and capricious under the Administrative Procedure Act (APA) because CFPB relied on incomplete and nonpublic data to estimate card issuers’ costs and failed to consider consumer costs sufficiently; (3) violates the Truth in Lending Act (TILA) by failing to implement an effective date of October 1, as required with new consumer-credit disclosures; and (4) should be set aside under the Appropriations Clause.

Policy Analysis & Advocacy Efforts

Amicus Brief
Plaintiffs' Opposition to Defendants' Motion to Dismiss the Fort Worth Chamber of Commerce for Lack of Standing and Transfer to the U.S. District Court for the District Of Columbia
August 12, 2024
Amicus Brief
Plaintiffs' Brief in Opposition to Defendants' Motion to Dissolve the Preliminary Injunction and Lift the Stay of the Final Rule (Or In Alternative Renewed Motion For A Preliminary Injunction)
August 8, 2024
Amicus Brief
Opinion Granting Mandamus
June 18, 2024
Amicus Brief
Motion for Leave to File Reply Brief in Support of Emergency Petition for Writ of Mandamus and Administrative Stay of Transfer
June 11, 2024

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In Depth

Credit Cards