PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

______________

No. 21-1020

______________

TITLEMAX OF DELAWARE, INC., d/b/a TitleMax; 

TITLEMAX OF OHIO, INC., d/b/a TitleMax; TITLEMAX 

OF VIRGINIA, INC., d/b/a TitleMax; TMX FINANCE OF 

VIRGINIA, INC.

v.

ROBIN L. WEISSMANN, in Her Official Capacity as 

Secretary of the Pennsylvania Department of Banking and 

Securities,

Appellant

______________

On Appeal from the United States District Court

for the District of Delaware

(D.C. Civil No. 1:17-cv-01325)

Magistrate Judge: Honorable Mary Pat Thynge

______________

Argued December 8, 2021

______________

Before: SHWARTZ, PORTER, and FISHER, Circuit Judges.
2

(Filed: January 24, 2022)

Douglas D. Herrman

Troutman Pepper Hamilton Sanders LLP

Hercules Plaza, Suite 5100

1313 N. Market Street, P.O. Box 1709

Wilmington, DE 19899

Richard J. Zack [ARGUED]

Troutman Pepper Hamilton Sanders LLP

3000 Two Logan Square

18th and Arch Streets

Philadelphia, PA 19103

Counsel for Plaintiffs-Appellees

Sean A. Kirkpatrick

Office of Attorney General of Pennsylvania

Strawberry Square

Harrisburg, PA 17120

Claudia M. Tesero [ARGUED]

Office of Attorney General of Pennsylvania

1600 Arch Street

Suite 300

Philadelphia, PA 19103

Counsel for Defendant-Appellant

______________

OPINION OF THE COURT

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3

SHWARTZ, Circuit Judge.

In this case, we are required to determine whether

applying Pennsylvania usury laws to an out-of-state lender 

violates the dormant Commerce Clause. We conclude that it 

does not.

I

A

TitleMax Delaware, TitleMax Virginia, TitleMax Ohio, 

and TMX Finance Virginia (collectively “TitleMax”) provide 

motor vehicle loans. When any customer, including a 

Pennsylvanian, seeks a loan from TitleMax, “[t]he entire loan 

process—from the application to the disbursement of funds—

takes place . . . at one of TitleMax’s brick-and-mortar locations 

. . . . If a loan is approved and TitleMax is the lender, TitleMax 

and the borrower execute a loan agreement . . . and the 

borrower receives the loan proceeds,” App. 19, in the form of 

“a check drawn on a bank outside of Pennsylvania,” App. 96.

The loan agreement sets forth an interest rate as high as 180%

and terms to secure the loan. 

Under the agreement, the borrower grants TitleMax a 

security interest in the vehicle. To perfect the lien, the

borrower provides TitleMax with the vehicle identification 

number, license plate number, and title certificate number. 

TitleMax then records its lien on the motor vehicle with the 

appropriate state authority, such as the Pennsylvania

Department of Transportation (“PennDOT”). 
4

In addition to perfecting the lien in the borrower’s state, 

TitleMax conducts servicing activities there, such as collecting 

payments, sending “phone calls[] or text messages,” and 

“repossess[ing vehicles].” App. 326, 337. Borrowers can 

make payments while physically present in their home state in 

a variety of ways, including mailing, calling TitleMax to use a 

debit card, or visiting a “local money transmitter . . . to have 

fees transmitted to a TitleMax location.” App. 181, 339. 

TitleMax does not dispute that, prior to 2017, it engaged 

in these activities with Pennsylvania residents and repossessed 

vehicles located in Pennsylvania when a Pennsylvania-resident

borrower defaulted. 

TitleMax does not have any offices, employees, agents, 

or brick-and-mortar stores in Pennsylvania and is not licensed 

as a lender in the Commonwealth. TitleMax claims that it has 

never used employees or agents to solicit Pennsylvania 

business, and it does not run television ads within 

Pennsylvania, but its advertisements may reach Pennsylvania 

residents. 

B

Two statutes, the Consumer Discount Company Act 

(“CDCA”), 7 Pa. Stat. §§ 6201-6221, and the Loan Interest and 

Protection Law (“LIPL”), 41 Pa. Stat. §§ 101-605, address 

lending activity. For example, the CDCA provides that “no 

person shall . . . make[] loans or advance[] money on credit, in 

the amount or value of . . . []$25,000[] or less, and charge, 

collect, contract for or receive interest . . . which aggregate in 

excess of the interest that the lender would otherwise be 

permitted by law to charge.” 7 Pa. Stat. § 6203(A). The LIPL 
5

sets forth a maximum interest rate of 6% for most loans below 

$50,000. 41 Pa. Stat. § 201(a). 

Pursuant to its authority to enforce these laws, 

Pennsylvania’s Department of Banking and Securities (the 

“Department”) issued a subpoena requesting documents 

regarding TitleMax’s interactions with Pennsylvania residents.

7 Pa. Stat. § 6212, 41 Pa. Stat. § 506. The subpoena sought

loan agreements between TitleMax and Pennsylvania 

consumers, information presented to Pennsylvania consumers 

through the mail or internet, solicitations or offerings 

circulated or aired in Pennsylvania, records of TitleMax 

employees who traveled to Pennsylvania, a list of vehicles 

repossessed in Pennsylvania, a record of complaints from 

Pennsylvania consumers, a record of invoices or bills sent to 

Pennsylvania consumers, and any electronic transfers of funds 

from Pennsylvania consumer bank accounts.1

TitleMax stopped making loans to Pennsylvania 

residents after receiving the subpoena and asserts that it has 

lost revenue as a result. 

1 TitleMax claims it does not have the “technological 

capability to identify all TitleMax entities that provided loans 

and/or credit services to borrowers who resided in 

Pennsylvania at the time their loan was originated or the 

arrangement of their loan was facilitated,” and thus “does not 

know the identity of all TitleMax entities that provided loans 

to Pennsylvania residents.” App. 207. 
6

C

TitleMax filed this action in the United States District 

Court for the District of Delaware, seeking injunctive and 

declaratory relief for, among other things, violations of the 

Commerce Clause. Separately, the Department filed a petition 

to enforce the subpoena in the Pennsylvania Commonwealth 

Court (the “Petition Action”).

2

 

In this action, the parties conducted discovery and filed 

cross-motions for summary judgment based on Younger

abstention and the dormant Commerce Clause. The District 

Court granted TitleMax’s motion and denied the Department’s. 

The Court held that Younger abstention did not apply but 

found that, because TitleMax’s loans are “completely made 

and executed outside Pennsylvania and inside TitleMax [brickand-mortar] locations in Delaware, Ohio, or Virginia,” the 

Department’s subpoena’s effect is to apply Pennsylvania’s 

usury laws extraterritorially in violation of the Commerce 

Clause. TitleMax of Del., Inc. v. Weissmann, 505 F. Supp. 3d 

353, 357-60 (D. Del. 2020). 

The Department appeals. 

2 TitleMax removed the Petition Action to the Middle 

District of Pennsylvania. Pa. Dep’t of Banking and Sec. v. 

TitleMax of Del., Inc. et al., No. 1:17-cv-02112-JPW (M.D. 

Pa. Nov. 16, 2017), ECF No. 1. The District Court remanded 

the case for lack of subject matter jurisdiction. Id., ECF No. 

49. The Petition Action remains pending. 
7

II3

We agree with the District Court that Younger

abstention does not bar us from hearing this case but hold that 

applying4the CDCA and LIPL to TitleMax’s conduct does not 

violate the Commerce Clause.5

A

In general, federal courts are “obliged to decide cases 

within the scope of federal jurisdiction.” Sprint Commc’ns, 

3 The District Court had jurisdiction under 28 U.S.C. 

§§ 1331 and 1343. We have jurisdiction under 28 U.S.C. 

§ 1291. We review a district court’s order granting summary 

judgment de novo, Mylan Inc. v. SmithKline Beecham Corp., 

723 F.3d 413, 418 (3d Cir. 2013), and we view the facts and 

make all reasonable inferences in the non-movant’s favor, 

Hugh v. Butler Cnty. Fam. YMCA, 418 F.3d 265, 267 (3d Cir. 

2005). Summary judgment is appropriate where “there is no 

genuine dispute as to any material fact and the movant is 

entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). 

The moving party is entitled to judgment as a matter of law 

when the non-moving party fails to make “a sufficient showing 

on an essential element of her case with respect to which she 

has the burden of proof.” Celotex Corp. v. Catrett, 477 U.S. 

317, 323 (1986). 

4 The parties agree that TitleMax’s challenge to an 

investigation into a violation of Pennsylvania law is ripe. 

5

In its single-count Amended Complaint, TitleMax 

listed both the Commerce Clause and the Due Process Clause 

as grounds to enjoin the Department’s investigation, but 

TitleMax did not rely on the Due Process Clause in its motion 
8

Inc. v. Jacobs, 571 U.S. 69, 72 (2013). In certain limited 

circumstances, however, “the prospect of undue interference 

with state proceedings counsels against federal relief.” Id. 

Under the Younger abstention doctrine, federal courts must 

refrain from interfering with three types of state proceedings. 

One of these is civil enforcement proceedings. Id. at 78.

A “civil enforcement proceeding” warrants Younger

abstention where the proceeding is “akin to a criminal 

prosecution” in “important respects.” Id. at 79 (citation 

omitted). To determine if a civil enforcement proceeding is 

quasi-criminal in nature, we consider whether (1) the action 

“was commenced by the state in its sovereign capacity,” (2) the 

action was “initiated to sanction the federal plaintiff for some 

wrongful act,” (3) there are “other similarities to criminal 

actions, such as a preliminary investigation that culminated 

with the filing of formal charges,” and (4) “the State could have 

alternatively sought to enforce a parallel criminal statute.” 

ACRA Turf Club, LLC v. Zanzuccki, 748 F.3d 127, 138 (3d 

Cir. 2014); see also Sprint, 571 U.S. at 79 (“Investigations are 

commonly involved.”). 

The Petition Action is not a “civil enforcement 

proceeding[].” Sprint, 571 U.S. at 73; ACRA Turf Club, 748 

F.3d at 138. Although the Petition Action was commenced by 

the Department, a state agency, it was filed to enforce a 

for summary judgment and mentioned due process only in a 

footnote in its brief before us. Thus, TitleMax has not 

preserved its due process claim. See Resol. Tr. Corp. v. 

Dunmar Corp., 43 F.3d 587, 599 (11th Cir. 1995) (“[G]rounds 

alleged in the complaint but not relied upon in summary 

judgment are deemed abandoned.”).
9

subpoena, not to sanction TitleMax. See Pa. Dep’t of Banking 

& Sec. v. TitleMax of Del., Inc., 1:17-cv-02112-JPW (M.D. 

Pa. Nov. 16, 2017), ECF No. 1-2 (Petition to Enforce an 

Investigative Subpoena and Enjoin Respondents), at 10 (“In 

the event that a person fails to comply with a subpoena for 

documents or testimony issued by the [D]epartment, the 

[D]epartment may request an order from the Commonwealth 

Court requiring the person to produce the requested 

information.”), 13 (requesting relief of an “Order against 

[TitleMax] requiring them to provide the information or 

documents required by the investigative subpoena, to enjoin 

them from further refusing any future requests for information 

made by the department, and to require Respondents to pay 

costs associated with bringing this action and conducting this 

investigation”). While enforcement of the subpoena may 

require TitleMax to produce information, it is not “retributive 

in nature” or “imposed to punish . . . some wrongful act.” 

ACRA Turf Club, 748 F.3d at 140 (citation and quotation 

marks omitted). Indeed, no activity has occurred in the Petition 

Action, and the threat of contempt of court for noncompliance 

with an order that the state court may enter in the future is 

insufficient to convert the Petition Action as it currently stands 

into a quasi-criminal case. See also Malhan v. Sec’y U.S.

Dep’t of State, 938 F.3d 453, 464 (3d Cir. 2019) (holding that 

an unfiled state proceeding cannot be part of an abstention 

analysis). Finally, while Pennsylvania has a parallel statute 

that make usury a crime, see, e.g., 18 Pa. Stat. § 4806.3 

(“Whoever engages in criminal usury . . . is guilty of a felony”), 

the existence of that criminal statute does not outweigh the 

other facts that show that the Petition Action here is not quasicriminal. 
10

Another type of case in which Younger abstention may 

apply is one that furthers the state court’s ability to perform its 

judicial function. Sprint, 571 U.S. at 78. The Department 

relies on Juidice v. Vail, 430 U.S. 327 (1977), to argue that the 

threat of contempt for noncompliance with the subpoena 

invokes a unique judicial function. In Juidice, the Supreme 

Court held that federal-court interference with a state’s 

contempt process is “an offense to the State’s interest . . . likely 

to be every bit as great as it would be were this a criminal 

proceeding.” Id. at 336 (citing Huffman v. Pursue, Ltd., 420 

U.S. 592, 604 (1975)). There, however, the defendant was held 

in contempt for failing to comply with a subpoena for a 

deposition. In contrast, the Petition Action presents only a 

possibility of contempt, akin to any other case where courts 

issue orders and a party’s noncompliance can lead to contempt. 

The Commonwealth Court has neither issued orders enforcing 

the subpoena nor made contempt findings. Id. at 329-30. 

There is thus no judicial contempt process with which this 

federal case can interfere. See Malhan, 938 F.3d at 464-65 

(noting that Juidice only required abstention because the state 

courts had issued contempt orders at the time the federal 

lawsuit was commenced and holding that, because a 

garnishment order against the plaintiff was vacated a year 

earlier, the purported judicial action was not “wait[ing] to be 

entered” as required for abstention).

Thus, Younger abstention does not bar us from reaching 

the merits of this case.6

6 The third category of cases to which Younger may 

apply is state criminal prosecutions, Sprint, 571 U.S. at 78, but 

the Petition Action is not a criminal prosecution. 
11

B

The Commerce Clause provides that “Congress shall 

have Power . . . To regulate Commerce . . . among the several 

States.” U.S. Const., art. I, § 8, cl. 3. This affirmative grant of 

authority to Congress “also encompasses an implicit or 

‘dormant’ limitation on the authority of the States to enact 

legislation affecting interstate commerce.” Instructional Sys., 

Inc. v. Comput. Curriculum Corp., 35 F.3d 813, 823 (3d Cir. 

1994) (citing Healy v. Beer Inst., 491 U.S. 324, 326 n.1 

(1989)). When evaluating whether a state statute violates the 

Commerce Clause, we examine the statute’s effect on interstate 

commerce. Brown-Forman Distillers Corp. v. N.Y. State 

Liquor Auth., 476 U.S. 573, 579 (1986). For example, 

[w]hen a state statute directly regulates or 

discriminates against interstate commerce, or 

when its effect is to favor in-state economic 

interests over out-of-state interests, we have 

generally struck down the statute without further 

inquiry. When, however, a statute only has 

indirect effects on interstate commerce and 

regulates evenhandedly, we have examined 

whether the State’s interest is legitimate and 

whether the burden on interstate commerce 

clearly exceeds the local benefits. 

Instructional Sys., 35 F.3d at 824 (quoting Brown-Forman, 476 

U.S. at 579). One way a challenged statute can “directly 

regulate” interstate commerce is if the statute has 

“extraterritorial effects that adversely affect economic 

production (and hence interstate commerce) in other states.” 

Cloverland-Green Spring Dairies, Inc. v. Pa. Milk Mktg. Bd., 
12

462 F.3d 249, 261-62 (3d Cir. 2006). A state law that directly 

controls commerce wholly outside its borders violates the 

dormant Commerce Clause, regardless of whether the state 

legislature intended for the statute to do so. Healy, 491 U.S. at 

336.

7

If the state statute does not have such extraterritorial 

reach or discriminate against out-of-staters, then it will be 

upheld unless the burden on interstate commerce is “clearly 

excessive in relation to the putative local benefits.” Pike v. 

Bruce Church, Inc., 397 U.S. 137, 142 (1970). This 

examination is sometimes referred to as Pike balancing. 

We thus follow a two-step approach in analyzing

TitleMax’s Commerce Clause claim here. Initially, we address 

the “territorial scope of the transaction that [Pennsylvania] has 

attempted to regulate”8and whether such transactions occur 

7 TitleMax argues that “[w]here the extraterritoriality 

doctrine has been invoked . . . discrimination does not matter 

and is not an element of the claim,” and that therefore “the Pike

balancing test and related principles are . . . not relevant.” 

Appellees’ Br. at 38 n.14. This argument misunderstands the 

necessary analysis. Extraterritorial effect does not 

automatically trigger special examination. Indeed, some

extraterritorial effect must be tolerated because, by analogy, 

courts routinely decide choice-of-law questions for contracts 

that cover multiple states, and there is “nothing untoward about 

applying one state’s law” to “activities outside [that] state.” 

See Instructional Sys., 35 F.3d at 825 (“[I]t is inevitable that a 

state’s laws, whether statutory or common law, will have 

extraterritorial effects.”). 

8 By issuing the subpoena, the Department is thus 

asserting that its usury laws may apply to TitleMax’s conduct. 
13

“wholly outside” the state. A.S. Goldmen & Co., Inc. v. N.J.

Bureau of Sec., 163 F.3d 780, 786 (3d Cir. 1999). If the 

transactions do not occur wholly outside of Pennsylvania, then 

“we determine whether the [regulation] is invalid under the 

[Pike] balancing test.” Am. Exp. Travel Related Servs., Inc. v. 

Sidamon-Eristoff, 669 F.3d 359, 372 (3d Cir. 2012). 

1

The CDCA regulates loans and collection activity. 7 Pa. 

Stat. § 6213(A). TitleMax’s transactions with Pennsylvanians 

involve both loans and collection, and these activities do not 

occur “wholly outside” of Pennsylvania. TitleMax’s 

transactions involve more than a simple conveyance of money9

at a brick-and-mortar store in a location beyond Pennsylvania’s 

border. Rather, the loan creates a creditor-debtor relationship 

We therefore examine whether applying Pennsylvania’s usury 

laws to TitleMax’s conduct violates the Commerce Clause. 

9 Moreover, even if TitleMax’s transactions were 

understood to be limited to the “origination” of the loan, our 

precedent makes clear that contracts between a Pennsylvanian 

and an out-of-stater do not occur “wholly outside” 

Pennsylvania. In A.S. Goldmen, we noted that conceptions of 

the territorial scope of contracts have evolved over time. 

Under the “traditional” approach, a contract is “made” in the 

state where the offer is accepted. 163 F.3d at 786-87. Under 

the “modern” approach, contracts formed between citizens in 

different states “implicate the regulatory interests of both 

states.” Id. Here, TitleMax extended credit to Pennsylvanians 

and, under the modern view, it does not matter that the 

consumers would have been physically outside of 

Pennsylvania when the transaction was initiated.
14

that imposes obligations on both the borrower and lender until 

the debt is fully paid. For instance, Pennsylvanians with 

TitleMax loans made payments to TitleMax while physically 

present in the state. See Quik Payday, Inc. v. Stork, 549 F.3d 

1302, 1308 (10th Cir. 2008) (holding that a loan transaction is 

not “wholly extraterritorial” and thus not problematic under the 

dormant Commerce Clause where the “transfer of loan funds 

to the borrower would naturally be to a bank in [the consumer’s 

state]”). In addition, TitleMax’s loan agreements grant 

TitleMax “a security interest in the Motor Vehicle,” which in 

the case of a Pennsylvania borrower is a Pennsylvaniaregistered automobile. App. 567-68. TitleMax records these 

liens with PennDOT and may repossess the vehicle if the 

consumer defaults on his loan. Thus, by extending loans to 

Pennsylvanians, TitleMax takes an interest in property located 

and operated in Pennsylvania. 

These aspects of loan servicing make TitleMax’s 

conduct different from that in the Healy line of cases, which 

largely involved transactions in goods that ended at the point 

of sale. See, e.g., Healy, 491 U.S. at 327 (price of beer); 

Baldwin v. G.A.F. Seelig, Inc., 294 U.S. 511, 519-20 (1935)

(price of milk for producers); see also Pharm. Rschs. & Mfrs. 

of Am. v. Walsh, 538 U.S. 644, 669 (2003) (noting the 

extraterritoriality rule in Healy is “not applicable” to cases 

where a statute does not tie prices of in-state products to outof-state prices).10

 Unlike the sale of a good, a TitleMax loan 

10 For this reason, the authorities TitleMax relies upon

are inapt. See Dean Foods Co. v. Brancel, 187 F.3d 609, 620

(7th Cir. 1999) (volume premiums on milk); Legato Vapors, 

LLC v. Cook, 847 F.3d 825 (7th Cir. 2017) (construction and 

maintenance of manufacturing facilities); Carolina Trucks & 
15

has a longer lifespan: it involves later payments and permits a 

physical taking (repossession) from inside another state. 

Because TitleMax both receives payment from within 

Pennsylvania and maintains a security interest in vehicles

located in Pennsylvania that it can act upon, its conduct is not 

“wholly outside” of Pennsylvania.11 

Equip., Inc. v. Volvo Trucks of N. Am., Inc., 492 F.3d 484 (4th 

Cir. 2007) (sales by truck dealers); Ass’n for Accessible Med.

v. Frosh, 887 F.3d 664 (4th Cir. 2018) (price of prescription 

drugs); Sam Francis Found. v. Christies, Inc., 784 F.3d 1320 

(9th Cir. 2015) (terms and conditions of artwork sales). 

11 A lack of “physical presence” in a state is not 

dispositive under a Commerce Clause analysis. See South 

Dakota v. Wayfair, Inc., 138 S. Ct. 2080, 2095, 2099 (2018). 

In Wayfair, the Supreme Court rejected the “physical 

presence” rule from Quill Corp. v. North Dakota, 504 U.S. 298 

(1992), which held that States could not require businesses 

without a physical presence in their state to collect its sales tax 

and that mere shipment of goods into a consumer’s state was 

insufficient for “presence.” 138 S. Ct. at 2099. The Wayfair

Court held that the Quill rule was incorrect and unworkable 

because “[m]odern e-commerce” facilitates closer connections 

between consumers and businesses regardless of physical 

presence or proximity. Id. at 2095. The Court explained that 

“a company with a website accessible in South Dakota may be 

said to have a physical presence in the [customer’s] State via 

the customers’ computers.” Id. Applying the same reasoning 

here, the fact that TitleMax operates no brick-and-mortar stores 

in Pennsylvania does not close TitleMax off from 

Pennsylvania consumers. On the contrary, TitleMax’s 

advertisements, through its website and through third-parties, 

reach customers in Pennsylvania and TitleMax informs 
16

For these reasons, applying the Pennsylvania statutes to 

TitleMax does not violate the extraterritoriality principle.

Pennsylvania callers that they need to “come into the store to 

further discuss anything as far as the loan products,” not that 

they cannot do business with them, App. 174. Indeed, their 

business relationship continues after the Pennsylvanian leaves 

the store and returns to Pennsylvania. 

As a result, Midwest Title Loans, Inc. v. Mills, 593 F.3d 

660 (7th Cir. 2010), on which the District Court relied in 

finding TitleMax’s conduct was “wholly outside” 

Pennsylvania, is unpersuasive. Midwest relied in part on the 

reasoning of Quill, see, e.g., 593 F.3d at 668 (“[Quill] is an 

example of extraterritorial regulation held to violate the 

[C]ommerce [C]lause even though the entity sought to be 

regulated received substantial benefits from the regulating 

state, just as Indiana’s regulation of Illinois lenders furthers a 

local interest—the protection of gullible or necessitous 

borrowers”), which is no longer good law. Aside from the 

“physical presence” rule in Quill, Midwest’s primary authority 

was Healy, see 593 F.3d at 666, which involved a price 

affirmation statute, not a statute regulating loans and 

continuing obligations to pay. Moreover, Midwest took a 

narrower view of the loan transaction than our Circuit has 

taken. Cf. Aldens, Inc. v. Packel, 524 F.2d 38, 45 (3d Cir. 

1975) (holding that a Chicago mail-order business’s credit 

transactions with Pennsylvanians were subject to 

Pennsylvania’s Goods and Services Installment Act because 

the burden on interstate commerce from regulating interest 

rates—the “time-price differential”—does not depend on “the 

happenstance of respective locations of buyer and seller”). 

Thus, its analysis does not govern.
17

2

Having determined that TitleMax’s conduct does not 

occur wholly outside of Pennsylvania, we must determine 

“whether the burdens [from the state law being applied] on 

interstate commerce substantially outweigh[] the putative local 

benefits.” Cloverland-Green, 462 F.3d at 258; see also Pike, 

397 U.S. at 142 (holding that where a statute addresses “a 

legitimate local public interest, and its effects on interstate 

commerce are only incidental, it will be upheld unless the 

burden imposed on such commerce is clearly excessive in 

relation to the putative local benefits”). The only burdens to 

be considered in the balancing test are those that “discriminate 

against interstate commerce.”12 Old Bridge Chems., Inc. v. 

N.J. Dep’t of Env’t Prot., 965 F.2d 1287, 1295 (3d Cir. 1992). 

On the interstate commerce burdens side, application of 

Pennsylvania’s usury laws to transactions with Pennsylvanians 

puts TitleMax in no different position than an in-state lender. 

See Instructional Sys., 35 F.3d at 826-27 (“[W]here the burden 

on out-of-state interests rises no higher than that placed on 

competing in-state interests, it is a burden on commerce rather 

than a burden on interstate commerce.” (emphasis in original)). 

While it may be true that TitleMax could be subject to different 

interest rate caps depending on the borrower’s state of 

residence, this result is not a “clearly excessive” burden on 

12

“If a legitimate local purpose is found, then the 

question becomes one of degree. And the extent of the burden 

that will be tolerated will of course depend on the nature of the 

local interest involved, and on whether it could be promoted as 

well with a lesser impact on interstate activities.” Pike, 397 

U.S. at 142. 
18

interstate commerce. First, a burden on a lender is not a burden 

on interstate commerce. Exxon Corp. v. Gov. of Md., 437 U.S. 

117, 127-28 (1978) (“The [Commerce] Clause protects the 

interstate market, not particular interstate firms, from 

prohibitive or burdensome regulations.”). Second, a lack of 

uniformity in state interest rates is not an undue burden, as 

“Congress has deferred to the states on the matter of maximum 

interest rates in consumer credit transactions.” Aldens, Inc. v. 

Packel, 524 F.2d 38, 45, 48-49 (3d Cir. 1975) (holding that 

application of Pennsylvania’s installment contracts law to a 

mail-order creditor’s business with Pennsylvania residents did 

not violate the Commerce Clause). Once it is clear that the 

laws do not discriminate between in-staters and out-of-staters, 

“the inquiry as to the burden on interstate commerce should 

end” and further analysis of the local benefits is unnecessary. 

Instructional Sys., 35 F.3d at 827. 

Even if we consider the local benefits, we would 

conclude that they weigh in favor of applying Pennsylvania 

laws to TitleMax. The laws protect Pennsylvania consumers 

from usurious lending rates. TitleMax’s interest rates may be 

as high as 180% but if the CDCA and LIPL applied, TitleMax’s 

rates for Pennsylvania customers would be capped at 6%.13 

Cash Am. Net of Nev., LLC v. Pa. Dep’t of Banking, 8 A.3d 

282, 285-86 (Pa. 2010). “Pennsylvania’s interest in the rates 

which its residents pay for the use of money for purchase of 

goods delivered into Pennsylvania is substantial enough to 

satisfy any due process objection to its attempt at regulating 

[credit on installment contracts].” Aldens, 524 F.2d at 43. The 

13 Not all car loans in Pennsylvania are capped at 6%. 

See 12 Pa. Stat. § 6243(e)(2) (capping interest rates at 21% for 

older, used motor vehicles). 
19

local interest in prohibiting usurious lending is equally 

important when evaluating a Commerce Clause challenge. 

See, e.g., Aldens, Inc. v. LaFollette, 552 F.2d 745, 751, 753 

(7th Cir. 1977) (holding that “[p]rotecting . . . citizens from 

usurious credit terms imposed when they are residents of the 

state” is a local interest sufficient for due process and for 

interstate-commerce balancing); Cash Am., 8 A.3d at 292 (“It 

is well established that public policy in this Commonwealth 

prohibits usurious lending, and this prohibition has been 

recognized for over 100 years.”). Thus, any burden does not 

clearly exceed the local benefits. Pike, 397 U.S. at 142. 

Pennsylvania has a strong interest in prohibiting usury. 

Applying Pennsylvania’s usury laws to TitleMax’s loans 

furthers that interest, and any burden on interstate commerce 

from doing so is, at most, incidental. Pennsylvania may 

therefore investigate and apply its usury laws to TitleMax 

without violating the Commerce Clause. 

III

For the foregoing reasons, we will reverse the judgment 

in favor of TitleMax and direct that the District Court enter 

judgment in favor of the Department.