Court strikes 1917 ‘bank rumor’ law in Oakland case

Few may have noticed but a federal appeals court in San Francisco yesterday struck down a 1917 state law that made it a misdemeanor, punishable by a $1,000 fine and up to a year in jail, to spread rumors about the financial condition of a bank. The law was put in to prevent the kind of financial panic that, well, Jimmy Stewart had to contend with in “It’s a Wonderful Life.” Overly broad, vague and an intrusion on free speech, the court said.

The context: the dismissal of a libel suit by Oakland’s Summit Bank against former executive Robert Rogers. He went off against his employer in missives posted to Craigslist’s “Rants and Raves” section in 2009. Bay City News Service