The U.S. Supreme Court case NationsBank of North Carolina, N.A., et al. v. Variable Annuity Life Insurance Co., et al., 1994 revolved around the issue of whether national banks could sell annuities under federal law and if such sales were considered part of the "business of banking." The court ruled in favor of NationsBank, stating that selling annuities was indeed a part of the business operations allowed for national banks under federal law (specifically Section 24 Seventh). This decision was based on an interpretation by Comptroller General Eugene Ludwig who argued that annuity sales were incidental to banking as they are similar to other investment products sold by banks like mutual funds or government securities. Therefore, this ruling expanded what activities can be considered within the scope and powers granted to national banks.

In the dissenting opinion for NationsBank of North Carolina, N. A., et al. v. Variable Annuity Life Insurance Co. et al., Justice Scalia disagreed with the majority's interpretation of federal law regarding bank powers and annuities sales activities by banks, arguing that it was inconsistent with both statutory text and historical practice. He contended that variable annuities are not "incidental" to banking as defined in 12 U.S.C §24 Seventh but rather insurance products subject to state regulation under McCarran-Ferguson Act (1945). According to him, allowing national banks to sell these products would undermine state regulatory authority over insurance industry which Congress intended to preserve through this act.