United States Court of Appeals

for the Fifth Circuit

No. 18-11375

Sharonda L. Johnson, on behalf of herself and all 

others similarly situated,

Plaintiff—Appellant,

versus

BOKF National Association, 

Defendant—Appellee.

Appeal from the United States District Court 

for the Northern District of Texas

USDC No. 3:17-CV-663

Before Higginbotham, Dennis, and Ho,* Circuit Judges.

James L. Dennis, Circuit Judge:

Plaintiff Sharonda Johnson, who holds a checking account with 

BOKF, National Association (“BOKF” or “the Bank”), filed this putative 

class action challenging “Extended Overdraft Charges” assessed by BOKF. 

Extended Overdraft Charges are what the Bank terms the fees it charges to 

customers who overdraw on their checking accounts and fail to timely pay 

the Bank for covering the overdraft. Johnson alleges that when the Bank paid 

* Judge Ho concurring in judgment only.

United States Court of Appeals

Fifth Circuit

FILED

September 29, 2021

Lyle W. Cayce

Clerk

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2

her overdraft, it extended her credit. Next, Johnson argues that the Extended 

Overdraft Charges BOKF assessed her when she did not reimburse the Bank 

timely for covering her overdraft constitute interest upon this extension of 

credit. Last, she contends that the Extended Overdraft Charges were

usurious in violation of § 85 of the National Bank Act of 1864, 12 U.S.C. § 1 

et seq. 

The district court concluded that these Extended Overdraft Charges

were not “interest” under the Act and, accordingly, dismissed the action for 

failure to state a claim. For the reasons that follow, we AFFIRM.

I.

A.

The National Bank Act of 1864 (“NBA” or “the Act”) governs the 

business activities of national banks like BOKF. Watters v. Wachovia Bank,

N.A., 550 U.S. 1, 6 (2007). Enacted in 1864, the NBA is intended to protect 

national banks against intrusive regulation by the states and facilitate a 

national banking system. Bank of Am. v. City & Cnty. of San Francisco, 309 

F.3d 551, 561 (9th Cir. 2002). National banks are also subject to regulation

by the Office of the Comptroller of the Currency (“OCC”), the agency 

charged by Congress with implementing the NBA. Watters, 550 U.S. at 6.

As relevant here, the NBA authorizes national banks to charge 

“interest at the rate allowed by the laws of the State . . . where the bank is 

located.” 12 U.S.C. § 85. The statute does not define the term “interest,”

and the Supreme Court has held that this statutory term is ambiguous and 

that courts should therefore defer to OCC’s interpretation of the word,

Smiley v. Citibank (S.D.), N.A., 517 U.S. 735, 739 (1996) (citing Chevron 

U.S.A. Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 842-45 (1984)).

In regulations promulgated through notice-and-comment rulemaking, 

OCC issued 12 C.F.R. § 7.4001(a), which defines the term “interest” as it is 

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used in § 85 of the NBA to mean “any payment compensating a creditor or 

prospective creditor for an extension of credit, making available of a line of 

credit, or any default or breach by a borrower of a condition upon which credit 

was extended.” 12 C.F.R. § 7.4001(a). This includes, inter alia, “late fees”

and “creditor-imposed not sufficient funds (NSF) fees charged when a 

borrower tenders payment on a debt with a check drawn on insufficient 

funds.” Id. When a bank assesses interest fees, it may only “charge interest 

at the maximum rate permitted . . . by the law of that state.” Id. § 7.4001(b). 

This maximum interest rate is referred to as the “usury limit.” Fawcett v. 

Citizens Bank, N.A., 919 F.3d 133, 135 (1st Cir.), cert. denied, 140 S. Ct. 224 

(2019); see also M. Nahas & Co., Inc. v. First Nat. Bank of Hot Springs, 930

F.2d 608, 610 (8th Cir. 1991) (using same term). Under the NBA, a bank 

customer who is charged interest exceeding the usury limit may recover 

“twice the amount of the interest paid.” 12 U.S.C. § 86.

Non-interest charges and fees, however, are not subject to OCC’s 

usury limits. See 12 C.F.R. § 7.4002. These non-interest charges include 

fees for what are broadly referred to as “deposit account services.” Id.

§ 7.4002(a). Banks have discretion to impose deposit account services fees 

and other non-interest charges on their account holders, such as the bank’s 

checking account customers, so long as the bank acts within the bounds of 

“sound banking judgment and safe and sound banking principles.” Id. 

§ 7.4002(b)(2).

In 2001, OCC further clarified its definition of “interest.” Though 

the agency left in place its regulation stating that “interest” includes late fees 

and NSF charges that a bank assesses when a borrower tenders a bad check 

to the bank, it stated that “overdraft and returned check charges” imposed by 

a bank on its own checking account customers were not interest within the 

meaning of § 7.4001(a), but rather charges for “deposit account services”

that fall under 12 C.F.R. § 7.4002. Investment Securities; Bank 

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Activities and Operations; Leasing 66 Fed. Reg. 8178, 8180 

(Jan. 30, 2001). OCC noted, however, that its regulations did not expressly 

resolve whether interest includes “at least some portion of the fee imposed 

by a national bank when it pays a check notwithstanding that its customer’s 

account contains insufficient funds to cover the check.” Id. at 8180. “A bank 

that pays a check drawn against insufficient funds may be viewed as having 

extended credit to the accountholder,” the agency observed. Id. 

Accordingly, OCC invited comment on this matter. 

Following notice-and-comment, OCC published its Final Rule, 66 

Fed. Reg. 34784 et seq. (July 2, 2001). OCC noted that it had “received 

numerous comments” regarding whether the regulation defining interest 

should include “any portion of the fee imposed by a national bank when it 

pays an overdraft.” Id. at 34787. However, OCC declined to amend the rule 

to address this issue given the “complex and fact-specific concerns” 

involved in determining whether “any portion of a charge imposed in 

connection with paying an overdraft constitutes ‘interest’” under the NBA.

Id.

In 2007, OCC issued Interpretive Letter 1082, squarely addressing for 

the first time whether fees charged by a Bank in connection with paying an 

overdraft may qualify as “interest” under the NBA. office of the 

Comptroller of the Currency, Interpretive Letter No. 1082, 2007 

WL 5393636, at *1 (May 17, 2007) [hereinafter Interpretive Letter 

1082]. Interpretive Letter 1082 was a response by OCC to an unnamed bank 

that described its overdraft fee structure to OCC and asked the agency 

whether, under the NBA and OCC’s regulations, it could “(1) in its 

discretion, honor items for which there are insufficient funds in depositors’

accounts and recover the resulting overdraft amounts as part of the Bank’s 

routine maintenance of these accounts; and (2) establish, charge and recover 

overdraft fees from depositors’ accounts for doing so.” Id. at *1. The bank 

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seeking guidance imposed a “Continuous Overdraft Charge of $5 per 

business day from the fourth through eleventh calendar day that an account 

is overdrawn.” Id. at *1 n.3. OCC concluded that the bank’s practices

complied with the NBA and the OCC’s regulations interpreting the NBA.

Id. at *1. Despite its earlier reservations, OCC asserted that “[c]reating and

recovering overdrafts have long been recognized as elements of the 

discretionary deposit account services that banks provide.” Id. at *2 (emphasis 

added). OCC further specified that the bank’s authority to charge a fee when 

it pays an overdraft is expressly provided for in 12 C.F.R. § 7.4002(a), which 

concerns non-interest charges and fees like deposit account service charges. 

Id. 

B.

BOKF is a national bank that offers, inter alia, checking account 

services to its customers. Pursuant to the Bank’s deposit account agreement, 

when a BOKF customer overdraws her account, BOKF may either: “(1) 

refuse to pay the item” and charge a “returned item fee” or (2) elect to pay 

the item” and charge an initial overdraft fee. The returned item fee and 

initial overdraft fee are both $32.50. Thus, any time a customer overdraws 

on her checking account—irrespective of whether the Bank chooses to cover 

its customers’ overdraft—the Bank imposes the same fee on its customer. If 

the Bank opts to pay the overdraft, the customer has up to five consecutive 

business days to repay the Bank the total of the amount of the overdraft and 

the initial overdraft fee. If the customer fails to do so within the applicable 

timeframe, the Bank charges an “Extended Overdraft Charge” of $6.50 per

business day until the overdraft is cured.2

2 Other banks refer to the same type of fees as “Sustained Overdraft Fees” or 

“Continuous Overdraft Charges.” See Fawcett, 919 F.3d at 136 (describing the “Sustained 

Overdraft Fees” charged by the bank in that case when it honors an overdraft; the bank 

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C.

Plaintiff Sharonda Johnson had a checking account with BOKF that 

was governed by the terms of the Bank’s deposit account agreement. In 2016, 

Johnson overdrew on her checking account. The Bank elected to cover her 

overdraft and assessed Johnson the initial overdraft fee of $32.50. When 

Johnson’s account remained overdrawn after five consecutive business days, 

BOKF assessed Johnson Extended Overdraft Charges of $6.50 per business 

day until Johnson cured the overdraft. At one point in 2016, Johnson’s 

account was overdrawn for seven business days following the expiration of 

the five-business-day grace period, resulting in BOKF charging Johnson a 

total of $45.50 in Extended Overdraft Charges. 

Johnson filed this putative class action, alleging that the Bank’s 

Extended Overdraft Charges constitute “interest” within the meaning of the 

NBA because the fees compensate the Bank “for [the] use or forbearance of 

money or as damages for its detention” Because the Extended Overdraft 

Charges are interest under the Act, they are subject to the usury limit in § 85 

of the Act, according to Johnson. Johnson alleges that the $6.50-per-day 

Extended Overdraft Charges exceeds the maximum interest that BOKF can 

charge its customers under the state law incorporated by NBA§ 85, which in 

her case was 6% per year.

In 2018, the district court dismissed Johnson’s action for failure to 

state a claim. Citing a number of district court decisions, the district court 

charges a “‘Sustained Overdraft Fee’ three times: $30 four business days after the

overdraft, another $30 after seven business days, and a final $30 after ten business days”);

Interpretive Letter 1082 *1 n.3 (discussing the “Continuous Overdraft Charges” 

assessed by a bank that covered its customers’ overdraft; the bank charged “$5 per business 

day from the fourth through eleventh calendar day that an account is overdrawn”). 

Consistent with how the deposit account agreement between the Bank and Johnson 

characterizes these charges, we refer to them as “Extended Overdraft Charges.”

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reasoned that BOKF does not make a loan to a customer when it covers the 

customer’s overdraft; therefore, the NBA’s limitations on interest charges 

do not apply. Johnson timely appealed. 

II.

We review de novo a district court’s dismissal under Federal Rule of 

Civil Procedure 12(b)(6). In re Katrina Canal Breaches Litig., 495 F.3d 191, 

205 (5th Cir. 2007)). To defeat a Rule 12(b)(6) motion to dismiss, a plaintiff 

must plead “enough facts to state a claim to relief that is plausible on its 

face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). The court accepts all well-pleaded facts as true, views them in the light most favorable to 

the plaintiff, and draws all reasonable inferences in the plaintiff’s favor. In re 

Katrina Canal Breaches Litig., 495 F.3d at 205.

III.

Johnson’s argument on appeal proceeds in two steps. First, she 

contends that the Bank makes a “loan” under § 85 of the NBA when it pays 

an overdraft on a customer’s deposit account. Second, she argues that the 

Extended Overdraft Charges the Bank charges a customer who fails to timely 

pay back the overdraft are “interest” on that loan within the meaning of § 85

of the NBA. It is undisputed that, if it is interest, the rate the Bank charges 

exceeds the applicable usury limits. 

We reject Johnson’s argument. Instead, we defer to the OCC’s 

interpretation that the Extended Overdraft Charges are not interest within 

the meaning of the NBA. 

A.

In Interpretive Letter 1082, OCC determined that the overdraft fees 

imposed by the bank seeking guidance constituted charges for non-interest

deposit account services under 12 C.F.R.§ 7.4002(a). Interpretive 

Letter 1082 at *1-*2. There, the bank charged a “Continuous Overdraft

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Fee” similar to the Extended Overdraft Charges that BOKF allegedly

charged Johnson after she failed to cure her overdraft within five business

days. Id. at n.3. We must decide, then, whether OCC’s conclusion that these

sort of Extended Overdraft Charges are a “deposit account service charge[]”

under 12 C.F.R. § 7.4002(a), and therefore not interest under § 7.4001(a), is

entitled to deference.

The Supreme Court recently reaffirmed that courts should defer to an 

agency’s reasonable interpretation of its own regulations when the 

regulation’s text is “genuinely ambiguous,” and the “character and context 

of the agency’s interpretation entitles it to controlling weight.” Kisor v. 

Wilkie, 139 S. Ct. 2400, 2414, 2416 (2019). When applicable, this deference 

regime, referred to as Auer deference, dictates that an agency’s interpretation 

is “controlling unless ‘plainly erroneous or inconsistent with the 

regulation.’” Auer v. Robbins, 519 U.S. 453, 461 (1997) (quoting Robertson v. 

Methow Valley Citizens Council, 490 U.S. 332, 359 (1989)). Auer deference 

rests on the presumption that “the power authoritatively to interpret its own 

regulations is a component of the agency’s delegated lawmaking powers.” 

Martin v. Occupational Safety and Health Review Comm’n, 499 U.S. 144, 151 

(1991). 

We heed the Supreme Court’s admonition that courts must 

“exhaust[] all the traditional tools of construction” before determining that 

a regulation is genuinely ambiguous and hence may be accorded Auer 

deference. Kisor, 139 S. Ct. at 2412415 (quoting Chevron, 467 U.S. at 843 n. 

9). Courts must “carefully consider the text, structure, history, and purpose 

of a regulation.” Id. Engaging in this rigorous inquiry, we conclude that the 

regulations at issue here, §§ 7.4001(a) & 7.4002—which define “interest”

and non-interest charges under the NBA, respectively—are genuinely 

ambiguous.

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Under OCC’s regulations, a charge can either be interest under 

§ 7.4001(a) or a non-interest charge under § 7.4002. Fawcett, 919 F.3d at 138 

(citing 12 C.F.R. §§ 7.4002(a), (c)). OCC itself has acknowledged that the 

text of § 7.4001(a) is ambiguous; in promulgating its Final Rule in 2001, the 

agency expressly stated that there was “ambiguity about the scope of the 

term [NSF fees] as used in § 7.4001(a).” 66 Fed. Reg. at 34786.

Moreover, OCC, as noted above, invited and “received numerous 

comments” on whether a bank charges “interest” within the meaning of the 

NBA when it pays a check even though its customer’s account lacks 

sufficient funds. Id. at 34747. The majority of comments opposed including 

such fees within § 7.4001(a)’s definition of interest. Yet, despite the 

extensive discussion the notice-and-comment period generated, OCC

expressly declined to amend the text of § 7.4001(a) to clarify whether the 

regulation reached these charges. Id.

Explaining its decision, OCC stated that determining whether any 

portion of overdraft charges or fees constitute interest necessarily implicates 

“complex and fact-specific concerns.” Id. Thus, the history of § 7.4001(a)

supports the conclusion that it is truly ambiguous as to whether excess 

overdraft fees like the ones here fall within its scope. Similarly, neither the 

structure of the regulation nor its purpose illuminate whether § 7.4001(a) 

embraces excess overdraft fees. In sum, we are persuaded that § 7.4001(a),

the regulation defining fees constituting interest under the NBA, is genuinely 

ambiguous. And because § 7.4001(a) is ambiguous, it is necessarily so that 

§ 7.4002, which covers all non-interest charges, is likewise ambiguous. That 

is so because the two regulations together cover all possible charges; if there 

is any lack of clarity as to whether a fee charged by a bank qualifies as interest 

under § 7.4001(a), then logic dictates that it is just as uncertain whether that 

fee is more properly classified as a non-interest charge under §7.4002. See 

Fawcett, 919 F.3d at 138.

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In addition to the requirement that the regulation be genuinely 

ambiguous, Auer deference is only merited when an agency’s interpretation 

of its regulation is “reasonable.” Kisor, 139 S. Ct. at 2415 (quoting Thomas 

Jefferson Univ. v. Shalala, 512 U.S. 504, 515 (1994)). We conclude that 

OCC’s determination in Interpretive Letter 1082 that “Continuous 

Overdraft Fees” are classified as deposit account services under § 7.4002—

and therefore not as interest under § 7.4001(a)—is reasonable, and indeed, 

Johnson does not argue otherwise. After all, OCC’s position is consonant

with the majority view on the subject based on the public comment 

submissions.

3

 

But, aside from OCC’s interpretation being reasonable, we must also 

inquire “whether the character and context of the agency interpretation 

entitles it to controlling weight.” Kisor, 139 S. Ct. at 2416. Although there is 

no “exhaustive test” on this point, the Supreme Court has laid out three

3 Johnson makes a passing argument that Interpretive Letter 1082 does not 

interpret interest under § 7.4001(a) because it does not expressly mention that regulation 

and instead discusses only whether Extended Overdraft Charges are charges and fees under 

§ 7.4002. We agree with the First Circuit that this contention 

[i]s a non-starter. The bank [to which Letter 1082 responded] asked for 

OCC’s guidance “under the ‘National Bank Act and [OCC] regulations.” 

. . . And under OCC’s regulations, a charge is either “interest” or it is a

“non-interest charge[],” which includes “deposit account service

charges.” 12 C.F.R. § 7.4002(a); see id. § 7.4002(c) (“Charges and fees 

that are ‘interest’ within the meaning of [the NBA] are governed by 

§ 7.4001 and not by this section.”). In classifying the bank’s excess

overdraft charges as “deposit account service charges,” OCC necessarily

rejected the conclusion that those charges were “interest.”

Fawcett, 919 F.3d at 138. Similarly, Johnson’s argument that § 7.4002 is “irrelevant” to 

determining whether the Extended Overdraft Charges constitute “interest” under 

§ 7.4001(a) is unavailing because OCC’s determination that these charges are “deposit account service charges” under § 7.4002 necessarily means that they cannot be “interest” 

under § 7.4001(a). See 12 C.F.R. § 7.4002(a) (stating that “charges and fees that are ‘interest’ . . . are governed by § 7.4001 and not by this section”).

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“especially important markers” for determining if an agency’s regulatory 

interpretation commands Auer deference: (1) whether the agency’s 

interpretation reflects the agency’s “authoritative” or “official position”; 

(2) whether “the agency’s interpretation implicates its substantive 

expertise”; and (3) whether the agency’s construction is rooted in its “fair 

and considered judgment.” Id. at 2416-17 (internal quotation marks 

omitted). 

First, Interpretive Letter 1082 appears to be an authoritative

statement rather than a “m[e]re ad hoc statement not reflecting the agency’s

views.” Id. at 2416. The letter was drafted by a senior OCC official, the

agency’s First Senior Deputy Comptroller and Chief Counsel. See id. 

(observing that the Court has deferred to “official staff memoranda . . . even 

though never approved by the agency head” (quoting Ford Motor Credit v. 

Milhollin, 444 U.S. 555, 566 n.9 & 567 n.10 (1980))); see also Ford Motor 

Credit, 444 U.S. at 566 n.9 (declining to “draw a radical distinction between” 

agency heads and staff for Auer deference). Moreover, the content of Letter 

1082 strongly indicates that it represents OCC’s official position on the 

matter of whether Extended Overdraft Charges should be classified as noninterest charges. It was written in response to a bank’s request for OCC’s 

guidance “under the National Bank Act and [OCC] regulations.” See 

Interpretive Letter 1082, at *1. And more to the point, Letter 1082

provides the agency’s views on the permissibility of overdraft fees, expressly

notes that the bank that asked for guidance charged Extended Overdraft 

Charges, and describes these fees as constituting non-interest charges under 

§ 7.4002(a). See id. at *1-*2 & *1 n.3. In short, Letter 1082 bears the 

hallmarks of an official interpretation by OCC.4

4 Though not dispositive of our decision here, we note that we have applied Auer 

deference in the past to OCC interpretive letters. See Wells Fargo Bank of Tex. NAv. James, 

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OCC’s interpretation of §§ 7.4001(a) and 7.4002 also falls squarely

within the agency’s substantive expertise. As noted above, OCC is

administering the NBA and regulations promulgated thereunder. Watters, 

550 U.S. at 6. And Interpretive Letter 1082 reflects OCC’s “fair and

considered judgment.” Kisor, 139 S. Ct. at 2417. There is no indication that

the interpretive letter was merely a “convenient litigating position” or “post

hoc rationalization advanced to defend past agency action against attack.” Id.

(internal quotation marks omitted). Nor does Johnson contend that the

agency’s position on Extended Overdraft Charges as articulated in Letter

1082 “creates unfair surprise to regulated parties,” id. Indeed, Letter 1082

appears aimed at providing assurance to regulated parties—that is, national

banks—about the permissibility of Extended Overdraft Charges and to give

fair notice that such fees are classified as non-interest charges under

§ 7.4002. Id. (internal quotation marks omitted).

In sum, Interpretive Letter 1082 represents OCC’s reasonable

interpretation of genuinely ambiguous regulations that it is charged with

administering. The agency’s position on fees like the Extended Overdraft 

Charges here is neither plainly erroneous nor inconsistent with the

regulations it interprets, §§ 7.4001(a) & 7.4002. OCC’s interpretation also

satisfies each of the three “especially important markers” that guide courts

in determining if an agency’s interpretation of its regulation warrants Auer

deference. Kisor, 139 S. Ct. at 2416-17. Accordingly, deference to OCC’s

interpretation of these regulations is appropriate, and the agency’s 

determination in Interpretive Letter 1082 that the type of bank fees at issue 

here—that BOKF refers to as Extended Overdraft Charges—are noninterest charges is a sufficient basis to resolve this case. Because Extended 

321 F.3d 488, 494-95 (5th Cir. 2003) (deferring under Auer to a position OCC advanced in 

agency interpretive letters).

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Overdraft Charges are non-interest charges, they are not subject to the 

NBA’s usury limits.

B.

Johnson also contends that the district court erred in dismissing her

complaint because she should have been allowed discovery on disputed issues of fact. Initially, we note that Johnson already availed herself of the opportunity the district court provided to conduct discovery. More important,

applying Federal Rule of Civil Procedure 8(a)’s pleading standard and taking 

as true Johnson’s well-pleaded facts, we have concluded that she has failed 

to “state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 

570. And “[t]o get to discovery, [Johnson] must allege sufficient facts in 

h[er] complaint to state a plausible claim for relief. ‘Because [Johnson’s] 

complaint is deficient under Rule 8, [s]he is not entitled to discovery, cabined 

or otherwise.’” Jackson v. City of Hearne, 959 F.3d 194, 202 (5th Cir. 2020)

(quoting Ashcroft v. Iqbal, 556 U.S. 662, 678–79 (2009)).

IV.

For these reasons, we AFFIRM the judgment of the district court.

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