Yick v. Bank of America, N.A.

Background

The plaintiffs challenged Bank of America’s handling of customer reports of unauthorized charges. The court stated that the bank often froze cardholder accounts based on a faulty screening process. According to the court, this conduct led or was likely to lead to improper denials of reimbursement claims, unlawful denial of provisional credits, and inability to access benefits to which cardholders were entitled.

Likelihood of success

The court held that the plaintiffs had shown a strong likelihood of success on claims that Bank of America violated the Electronic Fund Transfer Act by failing to conduct an adequate, good-faith investigation when cardholders reported unauthorized charges. The court also found a strong likelihood of success on claims that the bank systematically breached its contracts with cardholders and violated California’s Unfair Competition Law.

Class and preliminary-injunction factors

The court provisionally certified, for purposes of a preliminary injunction, a class consisting of all cardholders who call to report unauthorized charges to their accounts.

The court rejected Bank of America’s argument that the named plaintiffs or the class were categorically barred from obtaining temporary relief. It found Article III standing because many named plaintiffs were injured by the challenged conduct when they filed their lawsuits, and some continued to be injured. The court also found that Bank of America’s evidence did not defeat the plaintiffs’ showing that class members were likely to suffer similar violations in the future.

The court found irreparable harm, meaning harm that cannot be adequately repaired later with money damages. It emphasized that many class members depended on unemployment benefits during the pandemic and that continued denial of those benefits could hinder their ability to feed their families and keep housing. The court concluded that the balance of hardships and the public interest almost certainly supported some form of preliminary injunctive relief.

Next steps and disposition

The court explained that the appropriate relief depended on the injunction’s terms. It referred the case to Judge Sallie Kim for a settlement conference scheduled for May 26 and 27, 2021. The parties were ordered to work toward a joint proposal, or file competing proposals, by May 28. The court stated that Bank of America’s participation would not waive its right to challenge the validity of any preliminary injunction ultimately issued.

The opinion does not state that the court entered a specific preliminary injunction, and it does not provide the final terms of any such relief. Judge Chhabria ordered the referral and proposal process while finding that the plaintiffs had made the required strong showing for preliminary relief.