percentage of loans on the bank’s balance sheets, and deferred compensation to banks until the borrower performs on the loans. They also have either curtailed lending in the three states impacted by Madden or have reduced rates in those states to mitigate any negative issues raised by the decision. Fourth, in an effort to provide risk mitigation that is akin to a belt-and-suspenders approach, many lenders are also becoming licensed lenders in the states into which they are lending. Finally, the Solicitor General’s brief, reflecting the views of the Office of the Comptroller of the Currency, roundly criticized the Second Circuit decision and provided a roadmap as to the likely future arguments made in any future challenges to the Madden case in the Second Circuit. A recently filed class action suit, Bethune v. Lending Club, No. 1:16-cv-02578-NRB (S.D.N.Y), raises true lender and Madden-type issues and bears watching to see if the court issues any preliminary rulings that may bear on these topics.

The Supreme Court denial of the writ of certiorari in Madden is certainly not good news, but the financial services industry generally, and the marketplace lending industry in particular, have had more than a year to deal with the fallout from the case and continue to find ways to mitigate the concerns it raises. Berwyn | Boston | Detroit | Harrisburg | Los Angeles | New York | Orange County | Philadelphia | Pittsburgh | Princeton Silicon Valley | Washington | Wilmington pepper.law .