White v. BMO Bank N.A.

Summary

The United States District Court for the Northern District of California screened Todd White’s pro se complaint against BMO Bank N.A. under 28 U.S.C. § 1915(e)(2). The court held that White adequately stated claims under the Electronic Fund Transfer Act, Fair Credit Reporting Act, breach of contract, and California’s Unfair Competition Law, but dismissed his negligence claim with prejudice under the economic loss rule. The court ordered issuance of the summons and service by the U.S. Marshal without prepayment of fees.

Holdings

1. The court applies the Federal Rule of Civil Procedure 12(b)(6) failure-to-state-a-claim standard when screening an in forma pauperis action under 28 U.S.C. § 1915(e)(2)(B)(ii), accepting factual allegations as true and construing the pleadings in the plaintiff's favor.
2. White adequately stated a claim under the Electronic Fund Transfer Act by alleging that BMO charged overdraft fees for transactions despite his election not to receive overdraft services.
3. White adequately stated a claim under 15 U.S.C. § 1681s–2(b) by alleging that BMO failed to conduct a reasonable investigation after ChexSystems notified BMO of his dispute concerning furnished information.
4. White adequately stated a breach-of-contract claim by identifying the checking-account and overdraft-service agreement, alleging his performance or compliance with its terms, BMO's alleged breach, and resulting damages.
5. White's negligence claim was dismissed with prejudice because the alleged losses were purely economic and arose from the alleged breach of the same contract, and White alleged no physical injury.
6. White adequately stated a claim under California's Unfair Competition Law by alleging that BMO violated Regulation E through the alleged unauthorized overdraft fees.

Questions Presented

1. Whether White's complaint stated claims under the Electronic Fund Transfer Act and Regulation E based on BMO's alleged charging of overdraft fees despite his opt-out election.
2. Whether White adequately pleaded a Fair Credit Reporting Act claim based on BMO's alleged failure to investigate disputed information after notice from a consumer reporting agency.
3. Whether White adequately pleaded a breach-of-contract claim based on BMO's alleged violation of the checking-account and overdraft-service agreement.
4. Whether California's economic loss rule barred White's negligence claim for economic losses arising from the alleged breach of the checking-account contract.
5. Whether White adequately pleaded a claim under California's Unfair Competition Law based on the alleged Regulation E violation.

Disposition

other