Facts: American Express Travel Related Services (American Express) alleged that New York resident Titus Assih missed a credit card payment. His interest rate ballooned from 12.24% to 21%, and eventually to 27.99%. Assih made small payments for a time, but soon stopped paying altogether.

American Express sued Assih. The company sought to enforce this provision of its agreement: “This Agreement is governed by Utah law and applicable federal law.” The agreement’s only connection to Utah was that American Express assigned its interest to a one-branch bank in Utah. Assih argued that New York law, which sets strict limits on maximum rates of credit card interest, should apply instead. 

Questions:

1. Should New York or Utah law apply? Did the increased rates violate usury statutes?

2. Which state law will be followed in this case?

3. What is a consumer to do?