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HomeSuccessesOver $30 Million Recovered for Consumers in APPSN Bank Fees Class Action Settlements

Over $30 Million Recovered for Consumers in APPSN Bank Fees Class Action Settlements

Outcome: $30,440,000 collectively recovered in 3 settlements

Sharon T. Glass and Leric and Joyce Perryman, et al. v. Delta Community Credit Union, Case No.: 2019CV317322 in the Superior Court of Fulton County, Georgia

Clark v. Hills Bank and Trust, Case No.: LACV080753 in the Iowa District for Johnson County

This class action suit revolved around Delta Community Credit Union’s (Delta CCU) practice of charging overdraft fees on what’s termed as “Authorize Positive, Purportedly Settle Negative Transactions,” or APPSN Transactions. When a debit card transaction was authorized, they deducted the transaction amount from the consumer’s account, reserved funds to cover it, and adjusted the displayed available balance accordingly. Yet despite having ample funds set aside, Delta CCU still imposed a $35 Courtesy Pay Fee on many of these transactions, deceiving customers.

The heart of the issue lies in these APPSN transactions, where Delta CCU initially ensures there are enough funds to cover the transaction during authorization but later hits customers with overdraft fees when the transactions supposedly settle into a negative balance days later. The class representatives asserted claims for breach of contract and unjust enrichment.

In addition to paying $2.2 million to settle claims, Delta CCU will stop assessing APPSN Fees, agreeing not to revert to assessing APPSN Fees for a period of at least 5 years.

Another class action resolved allegations that a national bank’s checking account holders in the United States were charged overdraft fees on transactions that were authorized and approved into a positive available balance. This class action lawsuit regarding APPSN fees settled for over $27 million.

This next class action lawsuit alleged that Hills Bank and Trust (HB&T) charged overdraft and non-sufficient funds (NSF) fees in a manner that breached their contract terms and violated Iowa law. In April 2019, consumers filed a class action lawsuit against HB&T, accusing the bank of violating the contract and the implied covenant of good faith by improperly charging overdraft fees. Despite accounts having sufficient funds at the time transactions were authorized, and funds being earmarked for those transactions, HB&T allegedly still assessed overdraft fees if those transactions later settled into a negative balance, a practice referred to as “Authorize Positive, Purportedly Settle Negative Transactions” or “APPSN Transactions”. This practice, according to the Plaintiff, contradicts the bank’s contractual promises.

Class counsel negotiated a $740,000 non-reversionary settlement, representing approximately 40% of the damages likely to be recovered had the case gone to trial and resulted in a favorable verdict. The settlement agreement noted that the expertise required to address the complex legal and banking issues in this case underscores the competence and skill of class counsel. Over 14,000 individuals stood to benefit from the lawsuit, and the class representative was granted a $10,000 service award.

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