Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Smith v. Bank of Hawaii

United States District Court, D. Hawaii

June 28, 2019

RODNEY SMITH, individually and on behalf of all others similarly situated, Plaintiff,
v.
BANK OF HAWAII, Defendant.

          ORDER OVERRULING IN PART AND SUSTAINING IN PART OBJECTIONS, AND ADOPTING IN PART AND REJECTING IN PART MAGISTRATE JUDGE'S FINDINGS AND RECOMMENDATION, ECF NO. 151

          J. MICHAEL SEABRIGHT CHIEF UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         Defendant Bank of Hawaii (“BOH”) objects under 28 U.S.C. § 636(b)(1) and Local Rule 72.4 to the January 30, 2019 Findings and Recommendation of Magistrate Judge Richard L. Puglisi to Grant in Part and Deny in Part Plaintiffs' Motion for Class Certification, ECF No. 151 (“January 30 F&R”). ECF No. 155.

         Based on the following, the court OVERRULES IN PART and SUSTAINS IN PART the objections, and ADOPTS IN PART and REJECTS IN PART the January 30 F&R.

         II. BACKGROUND

         A. Factual Background

         The court assumes a familiarity with prior orders, which set forth detailed factual backgrounds to this action. See Smith v. Bank of Haw., 2017 WL 3597522 (D. Haw. Apr. 13, 2017) (“Smith I”) (denying BOH's Motion to Dismiss); Smith v. Bank of Haw., 2018 WL 1662107 (D. Haw. Apr. 5, 2018) (“Smith II”) (granting in part and denying in part BOH's first Motion for Summary Judgment); Smith v. Bank of Haw., 2019 WL 404423 (D. Haw. Jan. 31, 2019) (“Smith III”) (denying BOH's second Motion for Summary Judgment).

         Smith seeks to certify two classes: (1) The Sufficient Funds Class and (2) The Regulation E Class. ECF No. 131-1 at PageID #2563. The Sufficient Funds Class is “[a]ll persons who have or have had accounts with BOH who incurred overdraft fees for transactions when the real balance in the checking account was sufficient to cover the transactions from September 9, 2015, through September 30, 2017.” Id. The Regulation E Class is “[a]ll persons who have or have had accounts with BOH who incurred overdraft fee(s) for ATM or nonrecurring debit card transactions occurring from September 9, 2015, through September 30, 2017, who were opted-in using an Opt-in Agreement that defined an overdraft as ‘when you do not have enough money in your account to cover a transaction, but we pay it anyway.'” Id.

         B. Procedural History

         Smith filed his Complaint and First Amended Complaint (“FAC”) in the First Circuit Court of the State of Hawaii on September 9 and 13, 2016, respectively. ECF No. 1-1 at 1, 35. BOH removed the action to federal court on September 19, 2016. ECF No. 1. The FAC includes six causes of action: (1) violation of Hawaii Revised Statutes (“HRS”) Chapter 480 for unfair or deceptive acts or practices (“UDAP”); (2) breach of contract; (3) breach of the covenant of good faith and fair dealing; (4) unjust enrichment; (5) money had and received; and (6) violation of Electronic Funds Transfer Act (“EFTA”) for noncompliance with Regulation E. ECF No. 1-1.

         On October 22, 2018, Smith filed his Motion for Class Certification. ECF No. 131. On December 18, 2018, BOH filed its Opposition, ECF No. 146, and on January 22, 2019, Smith filed his Reply, ECF No. 150. On January 30, 2019, Magistrate Judge Puglisi issued the January 30 F&R. ECF No. 151. BOH filed its Objection to the January 30 F&R on February 13, 2019. ECF No. 155. Smith filed his Opposition to the Objection on February 27, 2019. ECF No. 157.

         A hearing was held on April 15, 2019. The court requested supplemental briefing on EFTA detrimental reliance, ECF No. 165. On April 29, 2019, BOH filed its Supplemental Memorandum, ECF No. 168, and Smith filed his Supplemental Memorandum, ECF No. 169 (corrected version, ECF No. 171).[1]

         III. STANDARD OF REVIEW

         When a party objects to a magistrate judge's findings or recommendations, the district court must review de novo those portions to which the objections are made and “may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge.” 28 U.S.C. § 636(b)(1); see also United States v. Raddatz, 447 U.S. 667, 673 (1980); United States v. Reyna-Tapia, 328 F.3d 1114, 1121 (9th Cir. 2003) (en banc) (“[T]he district judge must review the magistrate judge's findings and recommendations de novo if objection is made, but not otherwise.”).

         Under a de novo standard, this court reviews “the matter anew, the same as if it had not been heard before, and as if no decision previously had been rendered.” Freeman v. DirecTV, Inc., 457 F.3d 1001, 1004 (9th Cir. 2006); United States v. Silverman, 861 F.2d 571, 576 (9th Cir. 1988). The district court need not hold a de novo hearing; however, it is the court's obligation to arrive at its own independent conclusion about those portions of the magistrate judge's findings or recommendation to which a party objects. United States v. Remsing, 874 F.2d 614, 618 (9th Cir. 1989).

         IV. DISCUSSION

         A plaintiff moving to certify a class has the burden of showing that the proposed class satisfies the requirements of Federal Rule of Civil Procedure 23. See Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 614 (1997); Hanon v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992).

         To satisfy Rule 23(a), a proposed class must meet the prerequisites of (1) numerosity, (2) commonality, (3) typicality, and (4) adequacy of representation. See Fed. R. Civ. P. 23(a); In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 462 (9th Cir. 2000) (citing Anchem Prods., Inc., 521 U.S. at 612). BOH objects to the Magistrate Judge's findings and recommendation that Smith meets the typicality prerequisite. ECF No. 155 at PageID #3536. The court overrules the objection.

         To satisfy Rule 23(b), plaintiffs must show the action is maintainable under Rule 23(b)(1), (2), or (3). See Fed. R. Civ. P. 23(b); In re Mego, 213 F.3d at 462. Smith seeks class certification under Rule 23(b)(3), which requires that “the court find[] that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.” Fed.R.Civ.P. 23(b)(3). BOH objects to the Magistrate Judge's findings and recommendation that Smith's UDAP claim, breach of contract claim, and EFTA claim meet the predominance requirement in Rule 23(b)(3). See ECF No. 155 at PageID #3533, 3535, 3537. The court overrules the objection as to the UDAP claim, breach of contract claim, and EFTA claim for statutory damages. The court sustains the objection as to the EFTA claim for actual damages.

         Finally, BOH objects to the Magistrate Judge's findings and recommendation that the class period for the UDAP claim end on August 1, 2017. Id. at PageID #3537. BOH argues that the class period for the UDAP claim should end in June 2017, when customers received a change in terms notice that defined “available balance, ” rather than on August 1, 2017, when the notice went into effect. Id. The court overrules the objection.

         A. Typicality

         Rule 23(a)(3) permits certification only if “the claims or defenses of the representative parties are typical of the claims or defenses of the class.” Fed.R.Civ.P. 23(a)(3). “The purpose of the typicality requirement is to assure that the interest of the named representative aligns with the interests of the class.” Hanon, 976 F.2d at 508 (citation omitted). Typicality exists “if [representative claims] are reasonably coextensive with those of absent class members; they need not be substantially identical.” Hanlon v. Chrysler Corp., 150 F.3d 1011, 1020 (9th Cir. 1998), overruled on other grounds by Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011). Thus, “[s]ome degree of individuality is to be expected in all cases, but that specificity does not necessarily defeat typicality.” Dukes v. Wal-Mart, Inc., 509 F.3d 1168, 1184 (9th Cir. 2007), overruled on other grounds by Wal-Mart Stores, Inc., 564 U.S. 338. With these principles in mind, “[t]he test of typicality is whether other members have the same or similar injury, whether the action is based on conduct which is not unique to the named plaintiffs, and whether other class members have been injured by the same course of conduct.” Hanon, 976 F.2d at 508 (citation and quotation marks omitted).

         To provide context to BOH's objections, the court reviews Magistrate Judge Puglisi's findings concerning typicality. Magistrate Judge Puglisi found that Smith sufficiently demonstrated typicality of his UDAP claims because those claims are “based on Defendant BOH's conduct in assessing overdraft fees and in using the Account Agreement and Opt-In Agreement that contained the overdraft provisions at issue.” ECF No. 151 at PageID #3476. Magistrate Judge Puglisi also found that Smith sufficiently demonstrated typicality of his breach of contract claims because “the relevant contract provisions are the same for all putative class members and Defendant BOH's assessment of overdraft fees based on the available balance was uniform.” Id. at PageID #3474. Finally, Magistrate Judge Puglisi found that Smith sufficiently demonstrated typicality of his EFTA claims because his “Regulation E claim is based on uniform contract language and Defendant BOH's consistent conduct in assessing fees.” Id. at PageID #3478. BOH objects to Magistrate Judge Puglisi's finding that these claims meet the typicality prerequisite. ECF No. 155 at PageID #3552.

         BOH first asserts that Smith's claims are not typical because Smith opened three accounts in the span of a few years and Smith was a customer for longer than other class members. See ECF No. 155 at PageID #3552-53. These facts do not defeat typicality because Smith received the same standardized descriptions of the overdraft fee program (during the relevant ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.