Iowa Takes Battle over ATM Fees to High Court

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Government officials in Iowa are going to the U.S. Supreme Court in their battle with Bank One Corp. over regulating automated teller machines operated by national banks.

State Attorney General Tom Miller and Banking Superintendent Holmes Foster said they asked the justices in a filing Wednesday to overturn a lower court decision that one of Iowa's restrictive ATM laws does not apply to national banks.

Although the court fight began in 1997 as a dispute over whether Bank One could place ATMs in retail stores, it has expanded into a question about the legality of another Iowa statute that bans ATM surcharges.

Specifically, a three-judge panel of the U.S. Court of Appeals for the Eighth Circuit in St. Louis ruled in September that federal law pre-empts a state law barring banks without branches in Iowa from operating ATMs there. If upheld, that would mean Bank One could locate their machines in Sears, Roebuck and Co. stores as they originally intended. But Iowa officials and state-chartered banks fear the decision could lead to the undoing of the separate state Electronic Funds Transfer Act, which prohibits banks from imposing fees on noncustomers who use their ATMs.

"We are asking the court to uphold Iowa's law that requires universal ATM access without surcharges to all cardholders in the state, no matter who controls the ATM machine," Mr. …