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July 22, 2014

Ohio Court of Appeals Affirms Class Certification in Lawsuit Against FirstMerit Bank Related to Bank’s Unfair and Deceptive Overdraft Fee Practices

The Ohio Court of Appeals largely affirmed the grant of class certification in a case brought by consumers who allege that they were improperly assessed overdraft fees by FirstMerit Bank. The Court of Appeals rejected FirstMerit Bank’s arguments that that trial court had not rigorously analyzed the class certification question and that individual lawsuits were necessary in light of numerous unique factual and legal issues specific to each bank customer. 

The lawsuit alleges that the Plaintiffs, and other FirstMerit customers in Ohio, were charged additional overdraft fees because of FirstMerit’s unfair and deceptive standardized practice of posting debit card transactions to customer accounts from the highest dollar amount to the lowest dollar amount, regardless of the chronological order in which the transactions were actually made by the customer. According to Plaintiffs, because of the bank’s manipulation of its posting order, bank customers were charged overdraft fees when their accounts were not actually overdrawn. The Plaintiffs also allege that, in order to maximize the fees that it could charge its customers, FirstMerit grouped together customer’s debit card transactions with checks and other non-check debits for purposes of posting. According to the lawsuit, these practices breached FirstMerit’s agreement with its customers as well as constituted fraud by the bank. FirstMerit, who claims its mission is to “improve and preserve the financial well-being of [its] customers, shareholders, and the communities [it] serve[s,]” has nearly 200 branches in the Ohio, Western Pennsylvania, and Chicago, 

“The Ohio Court of Appeals made the correct call in largely affirming Judge Lucci’s well-reasoned class certification decision. FirstMerit’s customers should be able to fight the bank’s deceptive banking practices, which were applied uniformly to all customers, together. Banks like FirstMerit cannot continue to pocket huge amounts of money from their own customers by unfairly engineering their transaction posting processes,” said Hassan Zavareei. 

© 2014 by Tycko & Zavareei LLP

About the Author

Hassan A. Zavareei, Tycko & Zavareei Law Firm, Civil Rights Attorney
Partner

Hassan A. Zavareei earned his law degree from the University of California, Berkeley School of Law in 1995, where he graduated as a member of the Order of the Coif. Mr. Zavareei graduated cum laude from Duke University in 1990, with degrees in Comparative Area Studies and Russian. After graduation from Boalt Hall, Mr. Zavareei joined the Washington, D.C. office of Gibson, Dunn & Crutcher LLP, one of the nation’s premier law firms. In April of 2002, Mr. Zavareei became a founding partner of Tycko & Zavareei LLP.

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About the Author

Andrea R. Gold, Tycko & Zavareei Law Firm, Litigation Attorney
Partner

Andrea Gold earned her law degree from the University of Michigan Law School in 2004, where she was an associate editor of the Journal of Law Reform, co-President of the Law Students for Reproductive Choice, and a student attorney at the Family Law Project clinical program. Ms. Gold graduated with high distinction from the University of Michigan Ross School of Business in 2001, concentrating her studies in Finance and Marketing.

After finishing law school, Ms. Gold was awarded a prestigious public interest fellowship by the Skadden Fellowship Foundation. The Skadden Fellowship...

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