Zabienski v. ONB Bank and Trust Company

Filing 20

OPINION AND ORDER by Judge Claire V Eagan ; denying 5 Motion to Dismiss for Lack of Jurisdiction; finding as moot 6 Motion to Stay; denying 16 Motion for Summary Judgment; finding as moot 17 Motion for Extension of Time to Respond to Motion (Re: 2 Complaint ) (RGG, Chambers)

UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF OKLAHOMA

JAYMEE ZABIENSKI, individually and on
behalf of all others similarly situated,

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Plaintiff,
v.
ONB BANK AND TRUST,

Defendant.

Case No. 12-CV-0130-CVE-TLW

OPINION AND ORDER
Now before the Court are Defendant’s Motion to Dismiss (Dkt. # 5), Defendant’s Alternative
Motion to Stay (Dkt. # 6), and Defendant’s Motion for Summary Judgment and Brief in Support
(Dkt. # 16). Defendant moves, pursuant to Fed. R. Civ. P. 12(b)(1), to dismiss plaintiff’s claim for
lack of subject matter jurisdiction. In the alternative, defendant moves to stay this case pending the
outcome of a case before the United States Supreme Court. Defendant also moves for summary
judgment.
I.
Plaintiff’s complaint alleges that defendant has violated the Electronic Fund Transfer Act
(EFTA), 15 U.S.C. § 1693, et seq., by failing to post a notice “on or at” its automated teller machine
(ATM) stating that it charges a fee. Plaintiff alleges that, on September 15, 2011, she made a cash
withdrawal from an ATM operated by defendant. Plaintiff further alleges that defendant charged
her a $1.50 fee for this transaction and that the ATM did not have a notice posted on the machine
advising that a fee would be charged. The complaint seeks statutory damages in an amount to be
determined by the Court, as well as costs and a reasonable attorney’s fee.

In support of its motion for summary judgment, defendant has submitted an affidavit from
its Vice President of Compliance, Bank Secrecy Act and Community Reinvestment Act, Amber
Deramus. Dkt. # 16-1. Deramus’ affidavit states that she is responsible for overseeing defendant’s
compliance with federal regulations in Tulsa, Oklahoma, and that she conducts routine inspections
of ATMs to ensure compliance with the EFTA’s notice provisions. Deramus stated that she
conducted an inspection of the ATM in question on or about July 15, 2011, and that the physical fee
notice sign was in place at that time. She further stated that she conducted an inspection on
September 27, 2011, and discovered that the physical fee notice sign had been removed. She
replaced the sign and conducted an investigation of the employees at that branch and/or who had
responsibilities for ATMs in the area “to determine whether any ONB employee had removed or
damaged any fee notice that had been posted on the Subject ATM.” Id. at 3. Deramus stated that
her “investigation showed that no employee of ONB removed or damaged any fee notice that had
been posted on the Subject ATM between July 15, 2011 and September 27, 2011.” Id. Defendant
has also submitted an affidavit from its Assistant Vice President and Auditor, Tammy Torix, which
states that Torix accompanied Deramus during her ATM inspection on September 27, 2011. Torix’s
statement corroborates Deramus’ account of that inspection. Dkt. # 16-2 at 2.
II.
Defendant asserts that plaintiff lacks standing to bring suit and that her complaint should be
dismissed under Fed. R. Civ. P. 12(b)(1). Federal courts are courts of limited jurisdiction and, as
the party seeking to invoke federal jurisdiction, plaintiff bears the burden of proving that jurisdiction
is proper. See Southway v. Cent. Bank of Nigeria, 328 F.3d 1267, 1274 (10th Cir. 2003). A court
lacking jurisdiction “cannot render judgment but must dismiss the cause at any stage of the

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proceedings in which it becomes apparent that jurisdiction is lacking.” Basso v. Utah Power &
Light Co., 495 F.2d 906, 909 (10th Cir. 1974). Motions to dismiss under Rule 12(b)(1) “generally
take one of two forms. The moving party may (1) facially attack the complaint’s allegations as to
the existence of subject matter jurisdiction, or (2) go beyond allegations contained in the complaint
by presenting evidence to challenge the factual basis upon which subject matter jurisdiction rests.”
Merrill Lynch Bus. Fin. Servs, Inc. v. Nudell, 363 F.3d 1072, 1074 (10th Cir. 2004) (internal
quotations omitted). Here, defendant has facially attacked the sufficiency of the complaint’s
allegations as to the existence of subject matter jurisdiction. Where a motion to dismiss is based on
a facial attack, courts “apply the same standards under Rule 12(b)(1) that are applicable to a Rule
12(b)(6) motion to dismiss for failure to state a cause of action.” Muscogee (Creek) Nation v. Okla.
Tax Comm’n, 611 F.3d 1222, 1227 n.1 (10th Cir. 2010).
In considering a motion under Rule 12(b)(6), a court must determine whether the claimant
has stated a claim upon which relief may be granted. A motion to dismiss is properly granted when
a complaint provides no “more than labels and conclusions, and a formulaic recitation of the
elements of a cause of action.” Bell Atl. v. Twombly, 550 U.S. 544, 555 (2007). A complaint must
contain enough “facts to state a claim to relief that is plausible on its face” and the factual allegations
“must be enough to raise a right to relief above the speculative level.” Id. (citations omitted). “Once
a claim has been stated adequately, it may be supported by showing any set of facts consistent with
the allegations in the complaint.” Id. at 562. Although decided within an antitrust context,
Twombly “expounded the pleadings standard for all civil actions.” Ashcroft v. Iqbal, 129 S.Ct.
1937, 1953 (2009). For the purpose of making the dismissal determination, a court must accept all
the well-pleaded allegations of the complaint as true, even if doubtful in fact, and must construe the

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allegations in the light most favorable to claimant. Twombly, 550 U.S. at 555; Alvarado v.
KOB–TV, L.L.C., 493 F.3d 1210, 1215 (10th Cir. 2007); Moffett v. Halliburton Energy Servs., Inc.,
291 F.3d 1227, 1231 (10th Cir. 2002). However, a court need not accept as true those allegations
that are conclusory in nature. Erikson v. Pawnee Cnty. Bd. Of Cnty. Comm’rs, 263 F.3d 1151,
1154–55 (10th Cir. 2001). “[C]onclusory allegations without supporting factual averments are
insufficient to state a claim upon which relief can be based.” Hall v. Bellmon, 935 F.3d 1106,
1109–10 (10th Cir. 1991).
Summary judgment pursuant to Fed. R. Civ. P. 56 is appropriate where there is no genuine
issue of material fact and the moving party is entitled to judgment as a matter of law. Celotex Corp.
v. Catrett, 477 U.S. 317, 322–23 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986);
Kendall v. Watkins, 998 F.2d 848, 850 (10th Cir. 1993). The plain language of Rule 56(a) mandates
the entry of summary judgment “if the movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); see
also Celotex, 477 U.S. at 317. “Summary judgment procedure is properly regarded not as a
disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which
are designed ‘to secure the just, speedy and inexpensive determination of every action.’” Id. at 327.
“When the moving party has carried its burden under Rule 56[a], its opponent must do more
than simply show that there is some metaphysical doubt as to the material facts. . . . Where the
record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there
is no ‘genuine issue for trial.’” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574,
586-87 (1986) (citations omitted). “The mere existence of a scintilla of evidence in support of the
plaintiff’s position will be insufficient; there must be evidence on which the [trier of fact] could

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reasonably find for the plaintiff.” Anderson, 477 U.S. at 252. In essence, the inquiry for the Court
is “whether the evidence presents a sufficient disagreement to require submission to a jury or
whether it is so one-sided that one party must prevail as a matter of law.” Id. at 250. In its review,
the Court construes the record in the light most favorable to the party opposing summary judgment.
Garratt v. Walker, 164 F.3d 1249, 1251 (10th Cir. 1998).
III.
The EFTA requires that an ATM operator charging fees to ATM users must give notice that
a fee will be charged and disclose the amount of the fee. 15 U.S.C. § 1693b(d)(3)(A). Notice is
required “in a prominent and conspicuous location” on the machine itself, as well as on the screen
at some point “after the transaction is initiated and before the consumer is irrevocably committed
to completing the transaction . . . .” 15 U.S.C. § 1693b(d)(3)(B). The EFTA makes any ATM
operator who has violated the statute liable to consumers for actual damages, statutory damages,
court costs, and a reasonable attorney’s fee. 15 U.S.C. § 1693m.
A.

Defendant’s Motion to Dismiss
Defendant asserts that plaintiff cannot recover statutory damages because “she has not been

injured in fact, and therefore, lacks standing under Article III of the U.S. Constitution to proceed on
her own or as a class representative.”1 Dkt. # 5 at 3. Article III of the United States Constitution
limits federal courts to the adjudication of “cases or controversies.” U.S. CONST. art. III, § 2, cl. 1.
“The standing inquiry ensures that a plaintiff has a sufficient personal stake in a dispute to ensure

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Defendant also asserts that plaintiff cannot recover actual damages because she has failed
to allege detrimental reliance. However, as plaintiff notes in her opposition to defendant’s
motion, “it is quite clear that Plaintiff is not seeking actual damages under the EFTA . . . .”
Dkt. # 15 at 5. Thus, defendant’s argument regarding actual damages is inapposite.
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the existence of a live case or controversy which renders judicial resolution appropriate.” Tandy
v. City of Wichita, 380 F.3d 1277, 1283 (10th Cir. 2004); see also Allen v. Wright, 468 U.S. 737,
750–51 (1984). The Supreme Court has recognized three elements for standing under Article III:
First, the plaintiff must have suffered an “injury in fact” - an invasion of a legally
protected interest which is (a) concrete and particularized, and (b) “actual or
imminent, not ‘conjectural’ or ‘hypothetical.’” Second, there must be a causal
connection between the injury and the conduct complained of - the injury has to be
“fairly . . . trace[able] to the challenged action of the defendant, and not . . . th[e]
result [of] the independent action of some third party not before the court. Third, it
must be “likely,” as opposed to merely “speculative,” that the injury will be
“redressed by a favorable decision.”
Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992). The standing requirement ensures that “the
legal questions presented to the court will be resolved, not in the rarified atmosphere of a debating
society, but in a concrete factual context conducive to a realistic appreciation of the consequences
of judicial action.” Valley Forge Christian Coll. v. Ams. United for Separation of Church & State,
Inc., 454 U.S. 464, 472 (1982). The primary focus for any analysis of standing under Article III “is
whether plaintiff has suffered a present or imminent injury, as opposed to a mere possibility, or even
probability, of future injury.” Morgan v. McCotter, 365 F.3d 882, 888 (10th Cir. 2004). The Court
must determine if the plaintiff has standing “as of the time the action is brought.” Nova Health Sys.
v. Gandy, 416 F.3d 1149, 1154–55 (10th Cir. 2005). The party invoking the jurisdiction of a federal
court has the burden to establish Article III standing. New Eng. Health Care Emps. Pension Fund
v. Woodruff, 512 F.3d 1283, 1288 (10th Cir. 2008).
Defendant argues that, because plaintiff does not seek actual damages, she cannot meet the
requirement of showing an injury-in-fact. However, “[i]t is long settled in the law that 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.” Day v. Bond, 500 F.3d 1127, 1136 (10th Cir. 2007)
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(internal quotations omitted); see also Linda R.S. v. Richard D., 410 U.S. 614, 617 n.3 (1973)
(“Congress may enact statutes creating legal rights, the invasion of which creates [constitutional]
standing, even though no injury would exist without the statute.”).
Defendant has not cited any legal authority that would support a finding contrary to this wellsettled principle. In fact, at least four district courts have determined that an alleged violation of the
EFTA constitutes an injury sufficient to confer standing, even in the absence of actual damages. See
Sucec v. The Greenbriar, No. 5:11-cv-00968, 2012 WL 3079212, at *1 (S.D.W. Va. July 30, 2012)
(adopting report and recommendation recommending denial of motion to dismiss and finding that
plaintiff had standing to sue for EFTA violation “though he may have no actual damages”);
Campbell v. Hope Cmty Credit Union, No. 10-2649-STA, 2012 WL 423432, at *3 (W.D. Tenn. Feb.
8, 2012) (“Plaintiff has standing by virtue of the alleged invasion of her statutory right to notice of
the ATM fee pursuant to ETFA.”); Kinder v. Dearborn Fed. Sav. Bank, No. 10-12570, at *2 (E.D.
Mich. Dec. 20, 2011) (denying motion to dismiss and finding standing based on alleged violation
of EFTA); In re Regions Bank ATM Fee Notice Litig., No. 2:11-MD-2202-KS-MTP, 2011 WL
4036691, at *4 (S.D. Miss. Sept. 12, 2011) (“Congress created a statutory right to a particular form
of notice, and Plaintiffs allege that Defendant did not provide it. That is a concrete, particular
injury.”).
The Court finds that the plain language of the EFTA authorizes a plaintiff’s recovery of
statutory damages if successful on an EFTA claim. Thus, the statute is properly read in favor of the
rights of consumers in plaintiff’s position to bring a claim for statutory damages even in the absence
of actual damages. The alleged violation of the statute creates a concrete, particular injury-in-fact
and defendant’s motion must be denied.

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B.

Defendant’s Motion to Stay
Defendant requests that, should its motion to dismiss be denied, the Court stay this

proceeding pending the issuance of a decision by the United States Supreme Court in First Am. Fin.
Corp. v. Edwards, No. 10-708 (U.S. cert. granted June 20, 2011), because that decision “should
clarify the standing requirements in cases where the claim is purely for statutory penalty damages
. . . .” Dkt. # 6 at 2. Since defendant filed its motion, the Supreme Court dismissed the appeal in
First Fin. Corp. v. Edwards, 132 S.Ct. 2536 (2012), and held that the writ of certiorari was
improvidently granted. Thus, defendant’s motion to stay is deemed moot.
C.

Defendant’s Motion for Summary Judgment
Defendant’s motion reiterates its argument that plaintiff does not have standing to sue

because she cannot demonstrate an injury-in-fact. As noted above, the alleged violation of the
EFTA creates an injury-in-fact and plaintiff has standing to sue. Defendant has not presented any
evidence in its summary judgment motion that would alter that conclusion. Thus, defendant’s
motion for summary judgment based on the theory that plaintiff lacks standing is denied.
Defendant also argues that it is entitled to summary judgment because the undisputed facts
demonstrate that “the physical fee notice it had posted on the Subject ATM was removed by a third
party.” Dkt. # 16 at 9. The EFTA provides that, if the ATM operator has posted the required notice
and “the notice is subsequently removed, damaged, or altered by any person other than the operator
of the automated teller machine, the operator shall have no liability under this section for failure to
comply with [the notice provisions] of this title.” 15 U.S.C. § 1693h(d). Defendant argues that
Deramus and Torix’s affidavit testimony shows unequivocally that defendant placed the required
notice on the ATM and that no employee of ONB removed the notice. Plaintiff responds by stating

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that, because no formal discovery has yet occurred in this case, she has not had an opportunity to
investigate the claims of defendant’s witnesses. The Court notes that a scheduling order has not yet
been entered.
The Tenth Circuit has held that “discovery is strongly favored before summary judgment is
granted . . . .” Bryant v. O’Connor, 848 F.2d 1064, 1068 (10th Cir. 1998). However, “where a
plaintiff fails to produce any specific facts whatsoever to support an allegation, a district court may,
in its discretion, refuse to permit discovery and grant summary judgment.” Id. (internal quotations
omitted). Defendant’s argument in the present case rests on its assertion that no employee of
defendant removed the notice from the ATM. However, plaintiff has not been afforded the
opportunity to question the witnesses who make this assertion, nor has plaintiff been given the
opportunity to review defendant’s records pertaining to the investigation conducted by those
witnesses. The issue of who did or did not remove the fee notice is a question of fact. Because the
dispositive issue is a question of fact, the Court declines to exercise its discretion to decide the
summary judgment motion in the absence of any discovery. While defendant argues that “no
amount of discovery by Zabienski will overcome the conclusive evidence that establishes”
defendant’s exemption from liability, the Court prefers not to take counsel’s word for it, but instead
to allow that discovery to take place. Given the procedural posture of this case and the dispositive
issues presented, summary judgment is premature. See Owens v. City of Okla. City, 35 F.3d 574
(10th Cir. 1994) (holding that district court’s entry of summary judgment was premature where no
“reasonable discovery” had been completed); Tholen v. Ostler, No. 2:07CV645DAK, 2008 WL
4446673, at *11 (D. Utah Sept. 26, 2008) (“summary judgment on such a fact sensitive issue is
premature in light of outstanding discovery on the issue”).

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IT IS THEREFORE ORDERED that Defendant’s Motion to Dismiss (Dkt. # 5) is denied,
Defendant’s Alternative Motion to Stay (Dkt. # 6) is deemed moot, and Defendant’s Motion for
Summary Judgment and Brief in Support (Dkt. # 16) is denied without prejudice with the right to
renew at the completion of discovery. Because defendant’s motion for summary judgment is denied,
plaintiff’s pending motion to complete discovery before further responding to the summary
judgment motion (Dkt. # 17) is deemed moot.
DATED this 20th day of August, 2012.

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