Pub. 7 2016 Issue 2

SUMMER 2016 11 West Virginia Banker Despite these victories, the WVBA recog- nized the risk that plaintiff ’s lawyers might seek to overturn these hard won reforms in the courts. After the session ended, the WVBA monitored activity in cases brought before federal and state courts, and soon discovered several cases being advanced in the federal appeals court challenging the accepted interpretation of the unconscionability statute. Each sought to convince the federal courts to construe West Virginia law in a manner that would recognize a separate cause of action for unconscionable inducement, in effect undermining the West Virginia Supreme Court's prior interpretations. The Association took immediate action to ensure the banking industry’s voice would be heard in the debate and filed two “friend of the court” briefs advocating the industry’s position. With the WVBA’s urg- ing, in one of the cases, the federal court of appeals refused to grant the plaintiffs a forum to alter the West Virginia Supreme Court’s prior decisions. In the second case, the Court tackled the unconsciona- ble inducement argument head on, and although it recognized a separate cause of action, the Court handed the industry a victory by finding that the claim of uncon- scionable inducement requires a very high burden of proof. The WVBA took these victories into the 2016 session and sponsored and passed legislation that revised the statute to expressly state that this higher burden of proof is a prerequisite to recovery on an unconscionable inducement claim. Only acts constituting egregious conduct such as affirmative misrepresentations, active deceit, and concealment of material facts give rise to a claim under the statute. As the Association begins its 126th year, the need for careful and constant repre- sentation of the interests of West Virginia banks will continue to grow. The com- plexity of financial services regulation and the multi-faceted nature of advocacy for the industry, which requires monitoring of changes not just during the legislative ses- sion, highlight the significant contribution a trade association like the WVBA makes to the strength of the banking industry. n The author presents these materials with the understanding that the information provided is not legal advice. Due to the rapidly changing nature of the law, information contained in this publication may become outdated. Anyone using these materials should always research original sources of authority and update this information to ensure accuracy when dealing with a specific matter. No person should act or rely upon the information contained in this publication without seeking the advice of an attorney. Should you require more information concerning the legal and business aspects of the above, please feel free to contact the authors, Sandra Murphy, directly at (304) 347-1131 or via email at smurphy@bowlesrice.com, or Amy Tawney, directly at (304) 347-1123 or via email at atawney@bowlesrice.com. THINK BIG . For data, video, voice and cloud solutions that keep your company connected, Today, every successful company is a connected company. Frontier delivers innovative and reliable data, video, voice and cloud solutions on an advanced fiber network built for today and tomorrow. And backs it all with solid 24/7 support from dedicated specialists and tech experts. Contact a Frontier Business Edge Specialist and start thinking big. ©2016 Frontier Communications Corporation. 01136_FCE_TB_June_ROP_WVB SOLUTION INNOVATIONS ADVANCED FIBER NETWORK DATA | VIDEO | VOICE | CLOUD 24/7 TECH SUPPORT Contact us now. Frontier.com/ThinkBIG Ryan Bailey Regional Sales Manager (304) 344-3535 Ryan.Bailey@FTR.com Jeff Kay Regional Sales Manager (304) 216-7606 Jeffrey.Kay@FTR.com connected. 01136_FCE_TB_June_ROP_WVB_F.indd 1 5/13/16 2:13 PM Ms.MurphyandMs.TawneyarepartnerswithBowlesRice LLP. Ms. Murphy is the chair of the Bowles Rice Banking and Financial Services Team. Both focus their practices in banking, commercial law and corporate transactions.