WASHINGTON (3/16/09)—The California Supreme Court has scheduled oral arguments in the case of Miller v Bank of America (BofA), a lawsuit with broad implications for California credit unions, credit unions doing business in the state, and for direct deposits. Oral arguments are scheduled to begin April 7. The subject of the case is whether overdraft fees can be assessed in California by federally chartered depository institutions against Social Security (SS) funds in a checking account. The case has been winding its way through the California courts for years, and ended up before the state supreme court under appeal by the plaintiff. BofA has argued that federal law and regulation preempt a California law that prohibits tapping SS money in an account. However, in December 2004 a judge for the Superior Court of San Francisco upheld an over-$1 billion-dollar jury award against BofA for violating state law. The court found that the bank’s practice of using customers’ funds from accounts that may contain SS funds to pay checking account overdrafts and insufficient funds fees violated the California Unfair Business Practices Act. Then, in November 2006, a California Court of Appeals reversed the lower court's ruling and award, and decided in favor of BofA. The plaintiff, Miller, then filed an appeal with the California Supreme Court, which agreed to hear the case. The Credit Union National Association and banking associations joined the case in 2007 through amicus briefs that argued banks and federal credit unions are not subject to the court's ruling because of the prevention provisions in the National Bank Act, Office of the Comptroller of the Currency (OCC) Regulations, and the Federal Credit Union Act.