The U.S. Supreme Court case Farmers and Merchants Bank of Monroe, North Carolina v. Federal Reserve Bank of Richmond, Virginia in 1922 revolved around the issue of whether a check drawn on non-member state banks could be charged with exchange fees by member banks under the Federal Reserve Act. The Farmers and Merchants Bank argued that this practice was discriminatory as it imposed additional costs on non-member banks which were not levied against member institutions. However, the court ruled in favor of the Federal Reserve Bank stating that such charges were permissible under Section 16 of the Federal Reserve Act which allowed for "the collection or payment of checks and drafts at par". This decision affirmed that while all national banks are required to accept checks at face value from other members without charging an exchange fee, they can impose these fees on non-members.

In the dissenting opinion for Farmers and Merchants Bank of Monroe, North Carolina v. Federal Reserve Bank of Richmond, Virginia (1922), Justice McReynolds disagreed with the majority's view that a national bank could be sued in any district where it has established branches. He argued that this interpretation was inconsistent with federal law which stipulates that suits against national banks can only be brought in the district where they are "established." According to him, a bank is "established" at its main office as stated in its articles of association and not wherever it operates branches. Therefore, he believed that allowing lawsuits against banks outside their home districts would disrupt banking operations by exposing them to litigation risks across multiple jurisdictions. This would also contradict Congress' intent when enacting laws governing national banks - ensuring uniformity and stability within the banking system.