DENVER—A decision by a federal appeals court may give the Fourth Corner CU, chartered to serve the marijuana industry here, new life.
A three-judge panel for the 10th U.S. Circuit Court of Appeals has vacated a district court ruling that nixed the CU’s bid to receive a master account with the Federal Reserve Bank of Kansas City, The Cannabist reported.
Fourth Corner received a state credit union charter in November 2014. As CUToday.info reported, in 2015 The Fourth Corner filed suit against NCUA and the Federal Reserve after NCUA turned down the CU for NCUSIF deposit insurance and then the Fed followed by denying TFCCU a master account to access the payments system. The credit union has yet to open its doors for business.
The judges remanded the case to the district court with instructions to dismiss the amended complaint without prejudice. “By remanding with instructions to dismiss the amended complaint without prejudice, our disposition effectuates the
judgment of the two panel members who would allow the Fourth Corner Credit Union to proceed with its claims,” the judges wrote in their opinion.
“The district court dismissed the amended complaint, reasoning that Fourth Corner would use the master account to violate federal drug laws. This ruling was erroneous,” U.S. Circuit Judge Robert E. Bacharach wrote in one of three opinions published, the Cannabist noted. “The district court should have presumed that Fourth Corner would follow the court’s determination that servicing marijuana-related businesses is illegal. And in the amended complaint, Fourth Corner essentially promised to obey the law that would be set out in the eventual declaratory judgment…In these circumstances, the district court had little reason to jettison the standard on a motion to dismiss and rely instead on suspicions about what Fourth Corner would do.”