In re Cardtronics ATM Fee Notice Litig.

• Decision Date: 11 May 2012
• Docket Number: Case No. 11–MD–2245 BEN (BLM)
• Court: U.S. District Court — Southern District of California
• Parties: In re: CARDTRONICS ATM FEE NOTICE LITIGATION.

874 F.Supp.2d 916

In re: CARDTRONICS ATM FEE NOTICE LITIGATION.

Case No. 11–MD–2245 BEN (BLM)

United States District Court, S.D. California.

May 11, 2012.

Douglas P. Lobel, David A. Vogel, Cooley LLP, Reston, VA, Michelle Doolin, Cooley LLP, San Diego, CA, for Cardtronics.

ORDER GRANTING MOTION FOR SUMMARY JUDGMENT

ROGER T. BENITEZ, District Judge.

Presently before the Court is a Motion for Summary Judgment by Defendants Cardtronics USA, Inc. and Cardtronics, Inc. (collectively, “Cardtronics”). (Docket No. 17.) For the reasons stated below, summary judgment in favor of Cardtronics is GRANTED in member cases Sandoval v. Cardtronics USA, Inc., 11–CV–0217 BEN (BLM); Christensen v. Cardtronics USA, Inc., 11–CV–0236 BEN (BLM); Johnson v. Target Corporation, 11–CV–1203 BEN (BLM); and Johnson v. Target Stores, Inc., 11–CV–1208 BEN (BLM).

BACKGROUND

I. Procedural Background

This consolidated action arises from nine separate lawsuits originally filed in Alabama, California, Illinois, Mississippi, Tennessee, and Texas. The Judicial Panel on Multidistrict Litigation consolidated the actions because of the extensive factual and legal overlap of each case. See In re Cardtronics ATM Fee Notice Litig., 787 F.Supp.2d 1366, 1366–67 (J.P.M.L.2011).

Cardtronics moves for summary judgment on four of the member cases that are included in this multidistrict proceeding— Sandoval v. Cardtronics USA, Inc., 11–CV–0217 BEN (BLM); Christensen v. Cardtronics USA, Inc., 11–CV–0236 BEN (BLM); Johnson v. Target Corporation, 11–CV–1203 BEN (BLM); and Johnson v. Target Stores, Inc., 11–CV–1208 BEN (BLM). Being fully briefed, the Court finds the Motion suitable for determination on the papers without oral argument, pursuant to Civil Local Rule 7.1.d.1.

II. Factual Background

A. Cardtronics' Policies and Procedures

Cardtronics owns and operates over 45,000 ATMs across the United States. (Statement of Material Facts (“SMF”) [Docket No. 17–2] ¶ 1.) Cardtronics maintains a policy to ensure that posted notices, called “Network Decals,” are attached to its ATMs. ( Id. ¶ 4.) The Network Decals serve two purposes: (1) to provide a fee notice, and (2) to list the participating ATM networks that can be accessed using the ATM. ( Id. ¶¶ 6–8.) The Network Decals are attached to the ATMs using a strong epoxy, which is applied to a sticker made from polycarbonate. ( Id. ¶¶ 52–53.) The sticker has a strong adhesive backing that will likely not become detached from the ATM without human intervention. ( Id. ¶ 52.)

All ATMs owned by Cardtronics are brought to Cardtronics' warehouse in Houston, Texas, for pre-installation programming, configuration, and set-up (“staging”). ( Id. ¶¶ 9–10.) A standard form, titled “Cardtronics Prep/Re–Furb Work Order,” lists the possible staging tasks that may be required for an ATM. ( Id. ¶¶ 12–13.) A Cardtronics employee in the Program Management team reviews the bill of material and the specifications of the customer that will house the ATM, then customizes the Work Order to include the proper components, quantity numbers, and model numbers. ( Id. ¶¶ 14–15.) EveryWork Order that is generated requires that a Network Decal be placed on the ATM. ( Id. ¶ 16.)

Next, the Work Order is sent to a technician at the Cardtronics warehouse. ( Id. ¶ 17.) The technician uses the Work Order as a roadmap for what features are required for the ATM, and makes changes to the ATM accordingly. ( Id. ¶ 18.) Another Cardtronics employee, typically the shipping and receiving clerk, will check off that the required tasks have been completed on the Work Order before the ATM is shipped out. ( Id. ¶ 19.)

After the ATM is staged, it is shipped to its permanent location for installation. ( Id. ¶ 21.) Cardtronics uses third-party vendors to install the ATMs on-site. ( Id. ¶ 22.) The installation vendors must use a standard Cardtronics form titled “Installation Authorization” as a checklist during installation. ( Id. ¶ 23.) The Installation Authorization contains a section relating to “Installation Details,” which asks the technician whether the Network Decal has been applied to the ATM. ( Id. ¶¶ 24–25.) The Installation Authorization also asks whether the technician has taken a picture of the installed ATM. ( Id. ¶ 27.)

The vendor then sends the completed Installation Authorization and pictures to Cardtronics with its invoice for payment. ( Id. ¶ 28.) Once the materials are received, the Merchant Scheduling team reviews the form for completeness and for any discrepancies with the ATM. ( Id. ¶ 29.) If there is a problem, the Cardtronics employee works with the vendor to fix the problem. ( Id. ¶ 30.) For instance, if the Network Decal is missing, Cardtronics sends a Network Decal to the vendor to be applied to the ATM. ( Id. ¶ 31.)

If the ATM is owned by an independent store but will be operated under contract by Cardtronics, a similar process is used. The staging process does not occur in the Cardtronics warehouse, but rather, the ATM is shipped directly from the manufacturer to the installation site. ( Id. ¶¶ 32–33.) Cardtronics sends the third-party vendor the materials that would have been used during the staging process, including the Network Decal. ( Id. ¶ 34.) The vendor then stages and installs the ATM, using the Installation Authorization form. ( Id. ¶ ¶ 35–36.)

If an existing ATM is replaced, Cardtronics uses different terminology for the on-site process. Instead of referring to “installation,” Cardtronics refers to “reprogram.” ( Id. ¶ 37.) The ATM that is already on-site is reprogrammed using the same basic process that is followed in the Cardtronics warehouse. ( Id. ¶ 39.) Cardtronics sends a Network Decal to the third-party vendor for application to the ATM. ( Id. ¶ 40.) The technician performing the on-site reprogram uses a form titled “Reprogram Authorization.” ( Id. ¶ 41.) The relevant portions of the Reprogram Authorization are similar to the Installation Authorization, but use different terminology. ( Id.) The Reprogram Authorization asks whether the “Surcharge/Network decal” has been applied. ( Id. ¶ 42.) In addition, the Reprogram Authorization asks the technician to take a picture of the installed ATM. ( Id. ¶ 43.)

When Cardtronics dispatches vendors to ATMs for repair, maintenance, or cash replacement, Cardtronics instructs its vendors to only complete the work authorized by Cardtronics. ( Id. ¶ 55.) Cardtronics does not instruct its vendors to remove the Network Decals, except where a new one is provided to replace an older one. ( Id. ¶ 56.)

Cardtronics stores electronic documentation for its ATMs in Doclink, a database system. ( Id. ¶ 60.) After an ATM's installation documentation is reviewed by a Cardtronics employee, the documents are added to Doclink using an identifying “Terminal ID” or “TID” for the ATM. ( Id. ¶¶ 60–61.) Cardtronics attempts to include photographs of the ATMs at installation with the documentation. ( Id. ¶ 62.) In addition, documents from the Cardtronics warehouse, such as Work Orders, are scanned and saved into the warehouse server under the Terminal ID for the ATM. ( Id. ¶¶ 63–64.) Moreover, Cardtronics documents all changes made to an ATM in the field. ( Id. ¶ 65.) If any work is done to an ATM, including if the Network Decal is changed or removed, a ticket that specifies the change to be made to the ATM will be electronically generated. ( Id. ¶¶ 66–67.) The ticket is then stored in the Cardtronics system and is retrievable by the Terminal ID. ( Id. ¶ 68.) The only exception to this procedure is for large-scale changes made to Cardtronics' fleet of ATMs. ( Id. ¶ 69.) Such large-scale changes are documented using a spreadsheet. ( Id. ¶¶ 69–70.)

Cardtronics' procedures for ensuring that Network Decals are affixed to its ATMs are highly successful. Cardtronics is currently auditing its ATMs in order to place Braille instructions on each ATM. ( Id. ¶ 44.) As part of this process, Cardtronics has instructed its vendors to check whether the ATMs have Network Decals, and to identify those with missing Network Decals so that Cardtronics can place new ones on those ATMs. ( Id. ¶¶ 47–48.) Of the 8,877 ATMs that Cardtronics has visited, 87 were missing Network Decals. ( Id. ¶ 49.) In other words, over 99% of the ATMs had Network Decals. ( Id. ¶ 50.)

B. Individual ATMs at Issue in the Present Action

In the four lawsuits relevant here, a total of six ATMs are at issue. Each of these ATMs will be addressed in turn.

i. ATM at Vons Store in San Die go, California ( Sandoval Action)

The ATM at issue in the Sandoval action is located at a Vons store in San Diego, California (“San Diego ATM”). ( Id. ¶ 71.) The Work Order generated for this ATM indicates that the task of applying a Network Decal to the ATM was checked off as accomplished. ( Id. ¶ 72.) The completed Reprogram Authorization, dated January 2008, indicates that the Network Decal was on the ATM at the time it was reprogrammed. ( Id. ¶ 73.) In addition, Cardtronics has pictures taken by the technician after the reprogram, which show the Network Decal affixed to the ATM below the cash dispenser. ( Id. ¶ 74.) Cardtronics does not have any record of removing the Network Decal, or any record of instructing a vendor to remove the Network Decal. ( Id. ¶ 75.)

ii. ATM at Costco Store in Temecula, California ( Christensen Action)

One of the two ATMs at issue in the Christensen action is located at a Costco store in Temecula, California (“Temecula ATM”). ( Id. ¶ 76.) The Installation Authorization for this ATM, dated March 2007, indicates that the Network Decal was on the ATM at the time of installation. ( Id. ¶ 77.) In addition, Cardtronics has pictures taken by the technician after installation, which show the Network Decal below the cash dispenser. ( Id. ¶ 78.) Moreover, Cardtronics had pictures of the ATM taken in 2011, which show white residue on the ATM, where the Network Decal had previously been. ( Id. ¶ 79.) Cardtronics has no record of removing the...