Joining together in the continued fight against restrictions on consumer access to overdraft services, 18 state leagues and associations filed an amicus brief in the U.S. District Court for the Southern District of Mississippi this week. The move supports America’s Credit Unions’ challenge to the CFPB’s overdraft rule.

The CFPB finalized its rule — capping overdraft fees at $5 for institutions over $10 billion in assets — in December, and America’s Credit Unions filed its challenge the same day. America’s Credit Unions and the other plaintiffs are  seeking a preliminary injunction halting implementation of the rule.

The leagues argue that the CFPB failed to consider the differences in how credit unions operate compared to other financial services providers and that ignoring this difference will harm consumers.

The brief expands on America’s Credit Unions’ arguments that the CFPB’s rule “stretches the boundaries of the Truth in Lending Act beyond recognition.

“First, Congress designed TILA to ensure that consumers receive clear and meaningful disclosures regarding credit terms — not to dictate how financial institutions structure their operations or impose substantive limitations,” the brief reads. “Second, overdraft services, as historically understood and regulated, fall entirely outside TILA’s scope because they do not meet TILA’s statutory definition of an extension of ‘credit.’”

Paul Mercer, president of the Ohio Credit Union League — which spearheaded the initial legal response to the CFPB’s rule in conjunction with America’s Credit Unions — emphasized that member choice and need remain paramount.

“Consumers and credit unions of all sizes would unintentionally bear the negative brunt of the CFPB’s misdirected rule,” he said. “The fee cap ignores market realities—overdraft programs are a costly, and mostly break even, service for credit unions. But they are widely used, offering members a lifeline from their trusted financial cooperative when they need it most. We must preserve credit unions’ ability to remain autonomous in serving their members.”

The brief was filed by the California Credit Union League, Carolinas Credit Union League, Cooperative Credit Union Association, Cornerstone League, Illinois Credit Union League, Kentucky Credit Union League, The League of Credit Unions, Luminate-Louisiana’s Credit Unions, Michigan Credit Union League, Minnesota Credit Union Network, Mississippi Credit Union Association, Nebraska Credit Unions League, Nevada Credit Union League, New York Credit Union Association, Ohio Credit Union League, Tennessee Credit Union League, Utah’s Credit Unions, and Wisconsin Credit Union League.