Custodia Bank has enlisted two solicitors to represent it in its legal battle against the US Federal Reserve, as reported by Politico on May 26. Custodia CEO Caitlin Long confirmed the hiring, emphasizing the solicitors' expertise in federalism issues and their experience in regulating the crypto industry.

She commended their impressive track record in handling government controversies. The solicitors hired are Ian Gershengorn, formerly the Principal Deputy Solicitor General of the US under President Barack Obama, and Michelle Kallen, former Solicitor General of Virginia. Both are affiliated with the law firm Jenner & Block LLP. Fox Business reporter Eleanor Terrett acknowledged their strong performance in both the US Supreme Court and the US Courts of Appeal. Custodia is expected to formally announce their representation by filing a notice of appearance.

The legal dispute dates back to 2022 when Custodia sued the Federal Reserve's Board of Governors and the Federal Reserve Bank of Kansas City (FRBKC) for allegedly denying it a Federal Reserve master account. This account is vital for financial institutions as it allows them to conduct transactions directly with the Federal Reserve, streamlining processes, particularly in fiat-crypto transactions.

The court ruled in March that Custodia Bank had no statutory entitlement to such an account because the Board of Governors had not made a decision on the matter. Custodia filed its appeal on April 26.

This issue is distinct from Custodia Bank's efforts to become a member of the Federal Reserve, as its membership application was denied in January 2023.