MIAMI - (Mealey's) A federal judge in Florida on March 18 approved TD Bank NA's $62 million settlement that will allow the bank to exit a multidistrict litigation in which class members allege that several banks manipulated the order of debit card transactions to maximize checking account overdraft fees (In Re: Checking Account Overdraft Litigation, No. 09-md-02036, S.D. Fla.; See January 2013, Page 16).
U.S. Judge James Lawrence King of the Southern District of Florida made the ruling. TD Bank became the latest bank to reach a settlement in the MDL in which bank customer plaintiffs have challenged the order in which the banks post transactions to checking accounts, alleging that the practice improperly increases fees customers are charged when they overdraft their accounts.
The plaintiffs filed a motion for final approval of the settlement on Jan. 10.
According to the terms of the settlement agreement, TD Bank will create a $62 million common fund and pay approximately $750,000 for all costs associated with class notice and settlement administration.
Judge King denied the objections of plaintiffs Edward D. Smith and Andrea Barnes. Smith argued that he is unable to determine whether the settlement is beneficial to him, an argument the judge found "without merit" because the settlement notice "set forth in detail the terms of the Settlement, described the release, and informed Settlement Class Members of their rights."
"Ms. Barnes claims that TD Bank constantly charged her Overdraft Fees that caused her toincurfinancial debt and perpetuated a cycle of Overdrafts in her Account," Judge King continued. "Ms. Barnes' objection highlights the very problem that Plaintiffs alleged in the Action. The Settlement achieved with TD Bank has recouped a substantial percentage (approximately 42%) of the most probable damages that Ms. Barnes and all other Settlement Class Members could have recovered if Plaintiffs prevailed at every juncture throughout the balance of the litigationand on appeal. While the recovery achieved through the Settlement does not achieve a 100% recovery,the $62,000,000 Settlement Fund is an 'outstanding result' when considered in the context of TD Bank's vigorous defenses to liability and damages."
Bank of America NA, JPMorgan Chase Bank NA, PNC Bank NA, RBS Citizens Bank NA and Great Western Bank previously reached settlements in the MDL.
The plaintiffs are represented by Aaron S. Podhurst, Robert C. Josefsberg, Peter Prieto and John Gravante III of Podhurst Orseck in Miami; Bruce S. Rogow of Bruce S. Rogow PA in Fort Lauderdale, Fla.; Robert C. Gilbert, Stuart Z. Grossman, David M. Buckner and Seth E. Miles of Grossman Roth in Coral Gables, Fla.; E. Adam Webb, Matthew C. Klase and G. Franklin Lemond Jr. of Webb, Klase & Lemond in Atlanta; Russell W. Budd, Bruce W. Steckler and Mazin A. Sbaiti of Baron & Budd in Dallas; Ruben Honik and Kenneth J. Grunfeld of Golomb & Honik in Philadelphia; Michael W. Sobol, Roger N. Heller and Jordan Elias of Lieff Cabraser Heimann & Bernstein in San Francisco; David S. Stellings of Lieff, Cabraser in New York; and Ted E. Trief and Barbara E. Olk of Trief & Olk in New York.
TD Bank is represented by Susan Leming and William M. Tambussi of Brown & Connery in Westmont, N.J., and Clifford H. Ruprecht and Joshua D. Dunlap of Pierce Atwood in Portland, Maine.
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