Standing at the ATM: The Eighth Circuit Defines Informational Injury-In-Fact Under the EFTA
We all know that constitutional standing requires an injury-in-fact that is fairly traceable to the challenged conduct of the defendant. But how exactly does that operate under the Electronic Fund Transfer Act, 15 U.S.C. 1963, which requires two forms of notice of transactions fees on ATMs, both on-machine notice and on-screen notice, and provides for statutory damages?
In Charvat v. Mutual First Federal Credit Union, 725 F.3d 819, 2013 WL 3958300 (8th Cir., August 2, 2013), the plaintiff sought to certify a class of persons charged transaction fees on the Bank/defendant’s machines, which lacked the prescribed on-machine notice (but provided on-screen notice). The District Court dismissed the claims of Charvat, the putative class representative, for lack of standing, concluding that Charvat had alleged an injury at law, but not in fact.
Judge Shepherd, writing for the panel, reversed. Without addressing whether Charvat suffered an economic injury from the $2.00 transaction fee, the Court found that he had suffered an “informational injury” that alone was sufficient to confer standing, similar to the injury suffered by consumers in Truth In Lending Act cases or where a plaintiff fails to receive information which must be publicly disclosed pursuant to statute. The Court distinguished this type of statutory damages award to a consumer who personally experiences a statutory violation from those in qui tam cases, where a third party asserts the rights of another.
The Court went on to find that the informational injury was also fairly traceable to the defendant’s conduct, despite Charvat’s subsequent acceptance of the transaction fee after receiving the on-screen notice. The Court explained that the on-screen notice did not break the causal link between the on-machine notice violation and the alleged informational injury because, had the Bank not violated the on-machine notice requirement, Charvat would not have been forced to choose between completing a transaction that lacked the required notice and walking away from the ATM. The Court did not explain how Charvat’s choice to accept the fee impacted the causal chain.