Abhyankar v. JPMorgan Chase & Co

Background

In June 2017, a purported fraudster persuaded Yvonne M. Abhyankar, who was 82 years old at the time, to transfer approximately $5,000 from her Chase checking account. Abhyankar and her adult daughter, Kashi Behrstock, met with Chase employee Lorena Mejia at a Manhattan branch. Following that meeting, they closed Abhyankar’s existing checking account, jointly opened a new checking account, and made Behrstock a joint owner of Abhyankar’s savings account. They also took other precautions, including stopping automatic transfers, deposits, payments, and overdraft protection.

In March and April 2018, Abhyankar personally requested a series of one-time transfers totaling $192,000 at Chase branches. Chase employees verified her identification before processing the transfers. The money went to several entities and an individual identified in the opinion as purported recipients of the fraud. Chase did not flag the transactions as suspicious. After Behrstock learned about a $47,000 transfer on April 4, 2018, she contacted Chase and sought reimbursement. Chase denied the claim because Abhyankar, an authorized signer, had personally requested the transfers. Chase successfully rescinded a $19,000 transfer but was unable to rescind the others.

The opinion states that the record did not establish what medical condition, if any, affected Abhyankar. It was undisputed that she lived alone, traveled throughout New York City, handled her own shopping, and had not sought medical treatment for possible mental deficiencies or functional limitations.

Claims and Motions

Plaintiffs asserted four claims against Chase: breach of fiduciary duty, negligence, breach of contract, and a claim under the Electronic Fund Transfer Act, a federal law governing certain electronic fund transfers. The contract claim alleged that Chase agreed during the June 19, 2017 meeting to notify Behrstock before authorizing large withdrawals or transfers. The fiduciary-duty and negligence claims alleged that Chase assumed responsibilities to protect or monitor the accounts. The Electronic Fund Transfer Act claim alleged that Chase failed to follow Behrstock’s instruction to stop a pending transaction.

After discovery closed, both sides moved for summary judgment. Summary judgment is a decision without a trial when the evidence shows that no reasonable jury could find for the opposing party on a legally important issue. Chase argued that plaintiffs lacked evidence establishing a fiduciary relationship, a duty to monitor or stop Abhyankar’s transactions, or an agreement to notify Behrstock. Plaintiffs conceded that they could not prove their Electronic Fund Transfer Act claim at that time.

Court’s Analysis

Fiduciary-duty claim. The court held that plaintiffs had not provided evidence from which a reasonable factfinder could conclude that Chase and plaintiffs formed a fiduciary relationship. Under New York law, such a relationship requires a higher level of trust and evidence of the defendant’s actual control and dominance. The court concluded that the June 2017 account changes and Mejia’s recommendations reflected an ordinary bank-customer relationship, not Chase’s assumption of control over the accounts. Plaintiffs had unrestricted access to the accounts, and there was no evidence that Chase agreed to monitor large transfers or require Behrstock’s approval.

Negligence claim. The court held that plaintiffs had not shown that Chase owed them a duty to monitor or prevent transfers that Abhyankar initiated herself. Plaintiffs had not submitted evidence of a diagnosed condition affecting Abhyankar’s ability to manage her affairs or evidence that Chase knew of such a condition. The court also distinguished cases involving unauthorized access to accounts or fraudulent signatures. Here, each challenged transfer was made in person by an account owner whose identification was verified. Even assuming Chase had a duty of care, the court concluded that plaintiffs had not identified evidence showing that Chase breached it.

Breach-of-contract claim. The court held that plaintiffs lacked admissible evidence that Chase agreed to give Behrstock advance notice of large transfers or withdrawals. Mejia denied making such an agreement, and Behrstock testified that she did not recall one. The court rejected plaintiffs’ argument that Behrstock’s memory might later be refreshed at trial because that speculation did not create a genuine factual dispute.

Electronic Fund Transfer Act claim. Plaintiffs conceded that they could not prove this claim at that time. The court therefore recorded that Count Four was voluntarily dismissed. The opinion does not state that this dismissal was with or without prejudice.

Disposition

The court granted Chase’s motion for summary judgment in its entirety and denied plaintiffs’ motion. The court entered judgment for Chase and directed the Clerk to close the case. The opinion was signed by Judge P. Castel on July 15, 2020.