On Tuesday, a federal district court in the Southern District of New York issued an order dismissing a lawsuit brought by the New York Department of Financial Services (NYDFS) regarding a proposal of the Office of the Comptroller of the Currency (OCC) to issue federal charters to certain fintech firms. In dismissing the case, U.S. District Court Judge Naomi Reice Buchwald held the NYDFS did not have standing to sue because the OCC had not yet officially decided to issue charters to fintech companies. Judge Buchwald explained that because the OCC had not made “a final determination” that it will issue such charters, the injuries alleged by the NYDFS are “too future-oriented and speculative” to support the lawsuit.

By way of background, in December 2016, the OCC announced plans to study whether it could issue special purpose charters to fintech firms. In March 2017, OCC Comptroller Thomas J. Curry announced the OCC would be issuing charters to fintech companies. In the same month, the OCC released a document describing how fintech companies could apply for a charter. In May 2017, Mr. Curry stepped down from his position, and President Trump named Keith Noreika Acting OCC Comptroller.

The NYDFS then sued the OCC regarding the proposal to grant charters to fintech companies. According to the NYDFS, the OCC did not have authority to issue a charter to fintech companies and should not allow such companies to operate in New York without complying with the state’s usury law and other consumer financial regulations. In the following months, Acting Comptroller Noreika stated several times that the OCC had not reached a final decision about whether to issue charters to fintech companies. Joseph Otting was then nominated by President Trump as permanent Comptroller of the Currency and was confirmed in November 2017. In Judge Buchwald’s decision, she noted that she was not aware of any statement by Mr. Otting indicating his position on fintech charters.

The Conference of State Bank Supervisors filed a similar lawsuit against the OCC in the U.S. District Court for the District of Columbia. The OCC filed a motion to dismiss that lawsuit as premature, which motion is currently pending before the court.