The Clearing House (TCH) filed a joint-trades amicus brief in support of Huntington Bank’s 6th Circuit appeal in Meoli v. The Huntington National Bank. At issue in this case is a district court ruling that under the Bankruptcy Code, a bank is a “transferee” of all funds deposited to a client’s deposit account — even where those funds are paid out at the deposit account holder’s direction via checks, automatic payments, wire transfers, and the like. The court’s holding conflicts with the widely accepted interpretation of the term “transferee.” The trades argue that rather than applying well-theorized precedent interpreting the word “transferee,” the lower courts adopted a strained interpretation that illogically requires a bank to pay out $55 million in funds that flowed through it but that it did not keep. The trades also argue that important policy considerations counsel against the lower courts’ unprecedented interpretation of “transferee.”
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