731 F.3d 672 (7th Cir. 2013), 13-8018, Hughes v. Kore of Indiana Enterprise, Inc.

Docket Nº:13-8018.
Citation:731 F.3d 672, 86 Fed.R.Serv.3d 647
Opinion Judge:POSNER, Circuit Judge.
Party Name:David HUGHES, individually and on behalf of all others similarly situated, Plaintiff-Petitioner, v. KORE OF INDIANAENTERPRISE, INC., et al., Defendants-Respondents.
Attorney:Eric G. Calhoun, Attorney, Travis Calhoun & Conlon, Dallas, TX, for Plaintiff-Petitioner. Thomas E. Rosta, Attorney, Metzger Rosta, Noblesville, IN, for Defendants-Respondents.
Judge Panel:Before POSNER, MANION, and WOOD, Circuit Judges.
Case Date:September 10, 2013
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit
 
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731 F.3d 672 (7th Cir. 2013)

86 Fed.R.Serv.3d 647

David HUGHES, individually and on behalf of all others similarly situated, Plaintiff-Petitioner,

v.

KORE OF INDIANAENTERPRISE, INC., et al., Defendants-Respondents.

No. 13-8018.

United States Court of Appeals, Seventh Circuit.

September 10, 2013

Submitted Aug. 8, 2013.

Page 673

[Copyrighted Material Omitted]

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Eric G. Calhoun, Attorney, Travis Calhoun & Conlon, Dallas, TX, for Plaintiff-Petitioner.

Thomas E. Rosta, Attorney, Metzger Rosta, Noblesville, IN, for Defendants-Respondents.

Before POSNER, MANION, and WOOD, Circuit Judges.

POSNER, Circuit Judge.

The plaintiff in this class action suit seeks leave to appeal from the district judge's decertification of the class. Fed.R.Civ.P. 23(f). We have decided to allow the appeal in order to further the development of class action law ( Blair v. Equifax Check Services, Inc., 181 F.3d 832, 835 (7th Cir.1999)) regarding issues of notice in cases in which the potential damages per class member are very slight, and the suitability of class action treatment of such cases. The plaintiff has filed a brief in support of its motion for leave to appeal. The defendants have chosen to file nothing, so we can proceed to the merits. The defendants did not oppose class certification in the district court. Does that mean they favor it? Maybe, if they think that otherwise they might face multiple suits, though as we'll see this is extremely unlikely.

The defendants, affiliated companies that we'll treat as one and call Kore, owned ATMs in two bars in Indianapolis said to be popular with college students. The suit charges Kore with failing to post a notice on the ATMs that Kore charges a fee for their use. Such an omission violates, or rather violated, a provision of the Electronic Funds Transfer Act, 15 U.S.C. § 1693b(d)(3); see also Regulation E, 12 C.F.R. § 205.16(c), and so exposed Kore to liability to users of its ATMs. At the time of the alleged violations, the Act required two fee notices: a sticker notice on the ATM and an on-screen notification during transactions. Kore provided the latter notice but not, the suit alleges, the former. The Act has since been amended to remove the requirement of the sticker notice. Act of Dec. 20, 2012, Pub.L. No. 112-216, 126 Stat. 1590; Charvat v. Mutual First Federal Credit Union, 2013 WL 3958300, at *1, 725 F.3d 819, 821-22 (8th Cir. Aug. 2, 2013).

A plaintiff in an individual suit who proves a violation of the Act is entitled to his actual damages, if any, or to statutory damages of at least $100 but not more than $1000. 15 U.S.C. §§ 1693m(a)(1), (a)(2)(A). If a class action is filed instead, and is successful, the class is entitled to " such amount [of damages] as the court may allow," but only up to the lesser of $500,000 or 1 percent of the defendant's net worth. § 1693m(a)(2)(B)(ii). No minimum amount of damages to which a class member is entitled is specified, in contrast to the $100 minimum award to the plaintiff in a successful individual suit. § 1693m(a)(2)(B)(i). In both types of case (individual and class action) the court is to award " a reasonable attorney's fee" if the suit is successful, paid of course by the defendant. § 1693m(a)(3).

The parties stipulated that the limit to damages in this class action suit would be $10,000, that being 1 percent of Kore's net worth. The stipulation further states that there were more than 2800 transactions involving the two ATMs during the period covered by the suit (a year beginning on September 30, 2010). We're not told how many more, so let's assume the total was 2800, which would make the damages $3.57 per transaction at most (given the $10,000 class limit). The transaction fee was $3, and that would be the ceiling on a plaintiff's actual damages per transaction. Those damages might well be zero, if the

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plaintiff couldn't prove that had he known there was a $3 fee he would not have used the ATM.

The record doesn't indicate the distribution of transactions among class members. If each of them engaged in only one transaction and the class therefore has 2800 members, each would be entitled at most to just $3.57 (10,000 ÷ 2800) if the suit was successful...

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