Facts

Larry Wallace was a Wells Fargo customer. Sometime around February 24, 2016 he made an Uber ride payment using his Wells Fargo debit card. Wells Fargo's checking account provides overdraft protection. However, customers must opt into the service. If a customer opts in, then overdraft coverage is provided wherein Wells Fargo will, for a fee, pay the charge, even though the customer does not currently have the funds; this would be part of their overdraft protection plans. Alternatively, as part of their standard overdraft practices, if the transaction is not a "one-time" fee but rather "recurring," then Wells Fargo may pay for "recurring" fees but charge an overdraft fee accordingly. Finally, according to Wells Fargo's Consumer Overdraft Services Brochure, it will not authorize one-time debit card transactions. Wallace had never opted to enroll into Wells Fargo's Debit Card Overdraft Service nor did he authorize one-time transactions for Uber rides that were initiated on insufficient available funds. Accordingly, he filed suit, on behalf of himself and others similarly situated against Wells Fargo.

PLAINTIFFS' CONTENTIONS: Plaintiffs, Wallace and others, contended that even though it promised customers who did not opt into the Debit Card Overdraft Service that it would not authorize or charge overdraft fees on non-recurring, everyday transactions, Wells Fargo, as a matter of its banking policy, applied both policies to Lyft and Uber rides, one-time ride situations making them one-time purchases. In essence, Wells Fargo improperly assessed overdraft fees incurred from non-recurring Uber and Lyft rides by customers who did not opt into their debit card overdraft service. Plaintiffs 'specific contentions included declaratory relief for permanent injunction, breach of contract, violation of the California Consumer Legal Remedies Act; violation of the California Unfair Competition Law; and fraud pursuant to California Code of Civil Procedure Section 1281.2.

DEFENDANT'S CONTENTIONS: Defendant Wells Fargo denied the allegations asserted by plaintiffs. Specifically, Wells Fargo denied any wrongdoing or liability because, among other reasons, it is entitled to rely on the merchant's coding of a transaction as being recurring or non-recurring.

Result

Wells Fargo settled the case for just over $10.5 million dollars.