Charvat v. Mut. First Fed. Credit Union

• Citation: 725 F.3d 819
• Decision Date: 02 August 2013
• Docket Number: 12–2797.,Nos. 12–2790,s. 12–2790
• Parties: Jarek CHARVAT, Individually and on behalf of all others similarly situated, Plaintiff–Appellant v. MUTUAL FIRST FEDERAL CREDIT UNION, Defendant–Appellee Jarek Charvat, Individually and on behalf of all others similarly situated, Plaintiff–Appellant v. First National Bank of Wahoo, Defendant–Appellee United States of America Amicus on Behalf of Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

725 F.3d 819

Jarek CHARVAT, Individually and on behalf of all others similarly situated, Plaintiff–Appellant

v.MUTUAL FIRST FEDERAL CREDIT UNION, Defendant–Appellee

Jarek Charvat, Individually and on behalf of all others similarly situated, Plaintiff–Appellant

v.First National Bank of Wahoo, Defendant–Appellee

United States of America Amicus on Behalf of Appellant.

Nos. 12–2790, 12–2797.

United States Court of Appeals, Eighth Circuit.

Submitted: May 14, 2013.

Filed: Aug. 2, 2013.

Counsel who presented argument on behalf of the appellant was Deepak Gupta, of Washington, DC. The following attorney(s) appeared on the appellant brief; Tracy Hightower–Henne, of Omaha, NE., Michael P. Lewis, of Washington, DC., Earl N. Mayfield, of Washington, DC, Deepak Gupta, of Washington, DC, Gregory A. Beck, of Washington, DC, Jonathan E. Taylor, of Washington, DC.

Counsel who presented argument on behalf of the appellee was Kenneth W. Hartman, of Omaha, NE. The following attorney(s) appeared on the appellee First National Bank of Wahoo brief; Kenneth W. Hartman, of Omaha, NE. The followingattorney(s) appeared on the appellee First Federal Credit Union brief; Monica L. Freeman, of Omaha, NE, Todd W. Weidemann, of Omaha, NE.

The following attorney(s) appeared on the amicus brief of United States of America in support of appellants; Michael Jay Singer, Civil Division, Washington, DC, Christine N. Kohl, Civil Division, Washington, DC.

Before RILEY, Chief Judge, MELLOY and SHEPHERD, Circuit Judges.

SHEPHERD, Circuit Judge.

Jarek Charvat brought putative class actions against two Nebraska banks, Mutual First Federal Credit Union (“Mutual First”) and First National Bank of Wahoo (“First National”) (collectively, “Appellees”), alleging violation of the Electronic Fund Transfer Act (“EFTA”). See15 U.S.C. § 1693. The district court dismissed both of Charvat's suits for lack of standing, and he now appeals. We reverse.

I.

In early 2012, Charvat made several withdrawals from Appellees' ATMs. A total of three transactions occurred, one at Mutual First in Omaha and two at First National in Wahoo, Nebraska. At the time Charvat completed the transactions, the EFTA required ATM operators to provide two forms of notice, one “on or at” the ATM (“on machine” notice) and another on-screen during the transaction, if operators charged a transaction fee. See § 1693b(d)(3)(B)(i)-(ii), amended by Act of Dec. 20, 2012, Pub.L. No. 112–216, 126 Stat. 1590 (removing the “on machine” notice requirement). A transaction fee was not allowed without the prescribed notice, and consumers could recover various damages under the EFTA for violations. See § 1693m(a) (actual damages, statutory damages, costs, and fees). Charvat received an on-screen notice of a transaction fee at each ATM, which he accepted, and for each transaction Charvat was charged a $2.00 fee. However, Charvat alleges that neither of Appellees' ATMs had “on machine” notice.

Charvat brought separate putative class action suits against Appellees, alleging violation of the EFTA. Both First Mutual and First National moved to dismiss, arguing the district court lacked subject matter jurisdiction because Charvat did not have standing to bring his claims. The district court granted Appellees' motions to dismiss, concluding that Charvat had not alleged an injury in fact but only an “injury in law.” The district court held that an EFTA plaintiff “must allege an injury in fact that was caused by the lack of an exterior fee notice on the ATM,” and determined that Charvat had not done so. Charvat v. First Nat'l Bank of Wahoo, No. 8:12CV97, 2012 WL 2016184, at *3 (D.Neb. June 4, 2012) (emphasis omitted); see also Order to Show Cause 4, No. 8:12CV11, ECF No. 22 (reaching same conclusion in suit against Mutual First). Charvat filed timely appeals in both cases, which are now consolidated for appeal.

II.

We review the district court's dismissal of Charvat's complaints de novo, “accepting as true the factual allegations contained in the complaint and granting [Charvat] the benefit of all reasonable inferences that can be drawn from those allegations.” See Gomez v. Wells Fargo Bank, N.A., 676 F.3d 655, 660 (8th Cir.2012). The sole issue here is whether Charvat has standing to bring his EFTA claims against Appellees. “[The] ‘irreducible constitutional minimum of standing’ requires a showing of ‘injury in fact’ to the plaintiff that is ‘fairly traceable to the challenged action of the defendant,’ and ‘likely [to] be redressed by a favorable decision.’ ” Braden v. Wal–Mart Stores, Inc., 588 F.3d 585, 591 (8th Cir.2009) (quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992)). Although the district court primarily focused on the injury in fact element, Appellees also attack traceability. We address these two elements in turn.

A.

The injury in fact element requires a plaintiff to allege “an invasion of a legally protected interest which is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical.” Lujan, 504 U.S. at 560, 112 S.Ct. 2130. Because injury in fact is a constitutional requirement, Congress may not grant standing to an individual who would not otherwise have standing. See Raines v. Byrd, 521 U.S. 811, 820 n. 3, 117 S.Ct. 2312, 138 L.Ed.2d 849 (1997). Congress may, however, create legal rights via statute, the invasion of which can create standing to sue. See Warth v. Seldin, 422 U.S. 490, 500, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975) (“The actual or threatened injury required by Art. III may exist solely by virtue of statutes creating legal rights, the invasion of which creates standing....” (quotation omitted)).

The EFTA, the statute at issue here, was passed to establish a “basic framework establishing the rights, liabilities, and responsibilities of participants in electronic fund and remittance transfer systems.” ¹15 U.S.C. § 1693(b). The “primary objective” of the EFTA is “the provision of individual consumer rights.” Id. One of the consumer rights provided under the EFTA is the right to notice of fees linked to ATM transactions. See § 1693b(d). No ATM fee may be charged unless the consumer receives the prescribed notice and elects to continue the transaction. § 1693b(d)(3)(C). As noted above, when Charvat conducted his ATM transactions, the EFTA required notice of fees both on the ATM and also on the screen. See § 1693b(d)(3)(B)(i)-(ii), amended by Act of Dec. 20, 2012, Pub.L. No. 112–216, 126 Stat. 1590. The EFTA authorizes individual and class action suits for violations of the EFTA, with recovery of actual damages, statutory damages, costs, and attorney's fees. See § 1693m(a).

On appeal, Charvat argues he suffered two independent, equally cognizable injuries: an economic injury in the form of an illegal $2.00 fee and an informational injury due to Appellees' failure to provide the statutorily required notice. As an initial matter, Appellees argue Charvat waived any claim that the $2.00 fee constituted an injury in fact. Appellees argue Charvat repeatedly filed documents in the district court stating that the $2.00 fee was not the injury. See, e.g., Pl.'s Resp. to Def.'s Mot. to Dismiss 1, No. 8:12–CV–00097, ECF No. 11 (“The injury to Plaintiff Charvat and the putative class in this matter is not the $2.00 fee, but the failure to provide information in the manner prescribed by Congress.”). Charvat responds that his statements to the district court merely meant the $2.00 fee standing alone was not his injury, but rather that his injury was the combination of the $2.00 fee and the failure to provide both forms of notice. Charvat also argues that claiming the $2.00 fee as his injury is merely a new argument on appeal, and not a new issue, since the broader issue of standing was clearly before the district court. See Hintz v. JPMorgan Chase Bank, N.A., 686 F.3d 505, 508 (8th Cir.2012) (“Appellants' contention that the order was not on the merits raises only a new argument, not a new issue, and thus is not barred from review.”).

Notably, the district court did not address the $2.00 fee as an injury in fact, but only addressed the informational injury in its orders dismissing Charvat's claims. See Charvat, 2012 WL 2016184, at *2 (“The issue then is whether [First National's] failure to give a notice to which Charvat was statutorily entitled in itself constitutes an injury in fact to Charvat.”); id. at *3 (“Here, Charvat alleges only a statutory violation of the EFTA because [First National] failed to provide an exterior fee notice on its ATM.”); see also Order to Show Cause 4, No. 8:12CV11, ECF No. 22 (using identical language in suit against Mutual First). Nor did the district court discuss whether it found that Charvat waived the $2.00 fee as his injury in fact. Thus, we have no lower court decision to review regarding the $2.00 fee as an injury, either on the merits or in regard to an alleged waiver.

However, assuming, without deciding, that Charvat did waive the claim that the $2.00 fee constituted an injury in fact, we conclude Charvat still had standing to pursue his claims against Appellees based on the informational injury that he allegedly sustained. The district court concluded that because Charvat failed to allege some injury beyond the failure to receive an “on machine” notice, he had not suffered a cognizable injury in fact. We disagree. Decisions by this Court and the Supreme Court indicate that an informational injury alone is sufficient to confer standing, even without an additional economic or other injury.

The district court's rejection of Charvat's informational injury claim was based largely on the determination that a statutory violation, standing alone, was not a sufficient injury in fact. But Charvat identifies a variety of instances where the denial of a statutory right to receive information is sufficient to establish standing. For example, the Supreme Court “has previously held that a...