Disputes between bank regulators and banks rarely get to court. The grudges of a challenged regulator, winner or loser, may be too daunting.  They almost inevitably settle. Indeed, the last time a major bank indicated it would fight the disciplinary agenda of the New York State Department of Financial Services, DFS announced in 2012 it would up the ante by putting the license of the bank (Standard Chartered) on the line.  Shortly thereafter that bank folded and settled.

The pending federal action in Manhattan between BTMU and DFS is the rare exception. The bank and the regulator are exposed to significant risks.  Bank of Tokyo Mitsubishi UFJ (BTMU) v. Maria Vullo (as head of the Department of Financial Services), No. 1:17-cv-08691-SHS.  The Office of Comptroller of the Currency (OCC) (as amicus) finds itself facing accusations of lack of independence, lack of regulatory rigor and of being the vehicle for the political gerrymandering of a bank license, even though it is not a party.  Judicial involvement may clarify ordinarily elusive issues.