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NAFSA puts a positive spin on decision in tribal lending lawsuit

The office of American Web Loans in Red Rock, Oklahoma, owned by the Otoe-Missouria Tribe. Photo by Jane Daugherty.

The 2nd Circuit Court of Appeals on Wednesday handed a victory to the state of New York in an online lending case but tribal advocates are trying to put a positive spin on the decision.

Barry Brandon, the executive director of the Native American Financial Services Association, said the court recognized that strong tribal interests are at stake in the dispute. He believes the Otoe-Missouria Tribe of Oklahoma and the Lac Vieux Desert Band of Lake Superior Chippewa Indians of Michigan are poised for an "ultimate victory" in their battle against the state.

“This important decision is further recognition of the significant interests of Indian Country in the area of e-commerce and economic development and will bolster the tribes’ position as they continue in their efforts to preserve and protect their sovereign rights – through all available channels, including the courts," Brandon said in a press release.

The law firm that represents both tribes also called the ruling a "clear victory" even though a cease and desist order prevents them from doing business in New York for the time being. Rossette LLP compared the dispute to early clashes over Indian gaming and said the 2nd Circuit recognized the unique nature of the online lending business.

"Indeed, in appealing the District Court decision, the tribes’ primary goal was to make the Second Circuit understand that tribal lending should be analyzed as the modern-day equivalent of tribal gaming," the firm said in a statement. "As the opinion makes clear, the Second Circuit has fully agreed with this position, and accordingly, the appeal was an unequivocal success, notwithstanding the denial of the tribes’ preliminary injunction."

Turtle Talk has posted briefs from the case, Otoe-Missouria Tribe v. NY State Department of Financial Services.

Get the Story:
Appeals Court Rejects Claims by American Indian Payday Lenders (The New York Times 10/1)
Lawsky May Regulate Internet Loans for Now, Court Rules (Bloomberg News 10/1)
Federal Court Deals Blow to Online Lending by Two Indian Tribes (The Wall Street Journal 10/2)

2nd Circuit Decision:
Otoe-Missouria Tribe v. NY State Department of Financial Services (October 1, 2014)

Related Stories:
2nd Circuit rebuffs tribal online lenders in dispute with New York (10/1)
Jane Daughtery: Tribes lose out in battle over Internet lending (10/09)
Tribes seek expedited appeal in New York online lending suit (10/08)
Judge rebuffs tribal online lenders in case against New York (10/01)
Otoe-Missouria Tribe sees benefits from Internet lending firms (09/16)
Tribal online lenders off to court in lawsuit against New York (09/11)
Otoe-Missouria Tribe defends online payday lending business (08/14)

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