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Houston v. Fifth Third Bank

United States District Court, N.D. Illinois, Eastern Division

July 10, 2019

ANTHONY HOUSTON, Plaintiff,
v.
FIFTH THIRD BANK, Defendant.

          MEMORANDUM OPINION AND ORDER

          JOHN ROBERT BLAKEY, UNITED STATES DISTRICT JUDGE

         Plaintiff Anthony Houston sues Defendant Fifth Third Bank, claiming that Defendant violated the Electronic Funds Transfer Act (EFTA) and breached their account agreement by holding Plaintiff liable for certain alleged unauthorized transactions from Plaintiff's account. This Court previously dismissed without prejudice Plaintiff's first amended complaint, but granted Plaintiff leave to replead his claims. [32]. Plaintiff has since filed a second amended complaint (SAC) [23], and now Defendant brings a renewed motion to dismiss [37]. For the reasons explained below, this Court denies Defendant's motion.

         I. The Second Amended Complaint's Allegations

         In June 2018, Plaintiff maintained a deposit account with Defendant. [34] ¶ 6. On or about June 15, 2018, an unknown third party deposited a check in Plaintiff's account at one of Defendant's branches. Id. ¶ 8. Plaintiff has never visited that particular branch. Id.

         Plaintiff claims that the check “was altered or fictitious, ” and that the endorsement signature on the check looks nothing like his own. Id. ¶ 10. Plaintiff also claims that Defendant did not at any time compare the endorsement signature on the check with the signature it had on file for Plaintiff. Id. ¶ 11.

         The next day, June 16, 2018, between 9 a.m. and 10 a.m., Plaintiff received an email from Defendant stating that his passcode changed. Id. ¶ 12. Plaintiff promptly called Defendant to report that he did not authorize this passcode change and asked that Defendant lock his account. Id. ¶ 13. Plaintiff also changed his passcode. Id.

         Plaintiff asserts that Defendant should have prevented all further activity on his account at that point, but Defendant did not do so. Id. ¶¶ 14-15. Later that same day, an unknown third party again changed the passcode for Plaintiff's account, twice, and then withdrew $4, 030 from Plaintiffs account, via three withdrawals at an ATM and one electronic fund transfer through Zelle. Id. ¶ 16. Plaintiff called Defendant multiple times that day to report the attempted fraud on his account; Defendant told Plaintiff the situation would be “rectified.” Id. Plaintiff asserts he did not make, and received no benefit from, these transactions. Id. ¶ 18. He also claims that he did not provide his passcode, debit card, or PIN to anyone. Id. ¶ 19. Plaintiff additionally asserts that he never replied to any text message verification request from Defendant or any other entity regarding the transactions at issue. Id.

         Subsequently, Plaintiff notified Defendant of the unauthorized transactions, and Defendant temporarily credited Plaintiff $4, 030 and sent him a letter confirming the temporary credits on June 20, 2018. Id. ¶¶ 23, 25. But on July 3, 2018, Defendant sent Plaintiff two letters reversing the credits, stating that “our research confirms that the transaction was valid.” Id. ¶ 28.

         Defendant wrote to Plaintiff on August 1, 2018. Id. ¶ 36. In that August 1 letter, Defendant said that after completing its research on the parties' dispute, it connected the transactions “to other known fraudulent activity wherein the customer participated by giving the unauthorized party their debit card and PIN.” Id. ¶ 37. Defendant then reiterated its position denying Plaintiff's dispute. Id. ¶ 36.

         The SAC asserts two claims against Defendant: breach of contract (Count I), and violations of the EFTA (Count II). [34].

         II. Legal Standard

         To survive a motion to dismiss under Rule 12(b)(6), a complaint must provide a “short and plain statement of the claim” showing that the pleader merits relief, Fed.R.Civ.P. 8(a)(2), so the defendant has “fair notice” of the claim “and the grounds upon which it rests, ” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). A complaint must also contain “sufficient factual matter” to state a facially plausible claim to relief-one that “allows the court to draw the reasonable inference” that the defendant committed the alleged misconduct. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). This plausibility standard “asks for more than a sheer possibility” that a defendant acted unlawfully. Iqbal, 556 U.S. at 678. In evaluating a complaint under Rule 12(b)(6), this Court accepts all well-pleaded allegations as true and draws all reasonable inferences in the plaintiff's favor. Id. This Court does not, however, accept a complaint's legal conclusions as true. Brooks v. Ross, 578 F.3d 574, 581 (7th Cir. 2009).

         III. Analysis

         Defendant again moves to dismiss Plaintiff's claims in their entirety. [38]. This Court ...


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