Federal appeals court dismisses ATM fee price-fixing suit Rebecca DiLeonardo at 1:01 PM ET
[JURIST] The US Court of Appeals for the Ninth Circuit [official website] on Thursday dismissed [opinion, PDF] a lawsuit against several banks, including Bank of America (BOA) and Wells Fargo & Company [corporate websites], alleging that banks engaged in price-fixing practices when setting fees for using ATMs managed by other banks. The three-judge panel dismissed the complaint for lack of standing [Cornell LII backgrounder]. The lawsuit had centered around the "interchange fees" that banks charge each other for using each other's ATMs. Those fees are ultimately passed on to customers in the form of ATM fees. The plaintiffs alleged that banks had artificially increased the fees when passing them on to their customers. In its ruling the three-judge panel held that the plaintiffs did not have standing to sue because they did not directly pay the fee in question. Because it found that the plaintiffs did not have standing, the court did not address the question of whether the fees constituted illegal price-fixing.
Banks have faced a high volume of ATM and debit card litigation recently. Earlier this month US Bancorp, one of the 10 largest banks in the US, announced a $55 million settlement [JURIST report] to resolve lawsuits by customers over excessive overdraft fees. In May the US District Court for the Southern District of Florida approved a settlement in an overdraft case for JPMorgan Chase & Co requiring the company to pay $110 million to customers [JURIST report] in order to resolve the litigation. In November the court approved a settlement [JURIST report] in a class action suit against BOA for excessive overdraft fees. BOA was among more than two dozen US, Canadian and European lenders named as defendants in the class action lawsuit, which consolidated claims across the country in 2009. The plaintiffs claimed that BOA's practices were deceptive in that they did not reasonably notify customers that they had the option of opting out of the overdraft scheme and declining transactions. In November 2009, the UK Supreme Court [official website] ruled that the British government could not challenge the fairness of bank overdraft fees [JURIST report] as a matter of law.
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