Moore v. JPMorgan Chase Bank, N.A.

Background

Oleta Moore, Larella Moore, and Kimberley Moore alleged that they held one joint savings account and one joint checking account with JPMorgan Chase Bank, N.A. On April 2, 2021, they discovered that they could not access their accounts electronically. They then learned about transactions that included $4,250.35 transferred from the checking account to Ying Liang and $3,707 transferred from the checking account to Shenzhen Dingzhi. They notified the bank that the transfers were unauthorized.

The plaintiffs also alleged that an unauthorized transfer moved money from their savings account to their checking account. They claimed that, without that transfer, there would not have been enough money in the checking account to fund the unauthorized wire transfers. The bank acknowledged the dispute concerning the transfers to Ying Liang and Shenzhen Dingzhi but did not acknowledge the savings-to-checking transfer, according to the complaint.

Claims and Motion

The plaintiffs asserted claims under the Electronic Fund Transfer Act, the California Uniform Commercial Code, and California’s Unfair Competition Law. JPMorgan Chase moved under Federal Rule of Civil Procedure 12(b)(6), which allows dismissal for failure to state a legally sufficient claim, as to the Electronic Fund Transfer Act and Unfair Competition Law claims.

Electronic Fund Transfer Act claim

The Electronic Fund Transfer Act claim concerned the unauthorized savings-to-checking transfer, not the unauthorized wire transfers. Under the statute, an unauthorized electronic fund transfer is actionable only if the consumer receives no benefit from it.

The court held that the plaintiffs plausibly alleged that they received no benefit. Drawing reasonable inferences in their favor, the court concluded that making money available in the checking account for wrongdoers to steal could be a detriment rather than a benefit. The court also held that the unauthorized wire transfers could be considered as evidence supporting that inference, even though the plaintiffs were not bringing an Electronic Fund Transfer Act claim based on those wire transfers.

The court therefore DENIED the motion to dismiss the Electronic Fund Transfer Act claim.

Unfair Competition Law claim

The plaintiffs based their California Unfair Competition Law claim on the statute’s “unlawful” and “unfair” theories. The court explained that plaintiffs seeking equitable relief under that law in federal court must adequately allege that they lack an adequate remedy under ordinary legal claims.

The court found that the plaintiffs did not, and could not, allege that their legal claims provided an inadequate remedy. It therefore GRANTED without prejudice the motion to dismiss the Unfair Competition Law claim.

Disposition

The court DENIED the motion to dismiss the Electronic Fund Transfer Act claim and GRANTED without prejudice the motion to dismiss the Unfair Competition Law claim. The order did not state a disposition for the separate California Uniform Commercial Code claim. The order disposed of Docket No. 19.