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Ramona Trombley, et al., On Behalf of Herself and All Others Similarly Situated v. National City Bank

January 11, 2011


The opinion of the court was delivered by: John D. Bates United States District Judge


Presently before the Court is Plaintiffs' Unopposed Renewed Motion for Preliminary Approval of the Class Action Settlement, Certification of Settlement Class, and Setting of a Final Fairness Hearing. Through their motion, plaintiffs request that the Court enter an Order: (1) preliminarily certifying a class for settlement purposes only; (2) preliminarily approving the Revised Settlement Agreement filed with the Court on December 22, 2010; (3) approving the notice provisions outlined in the Revised Settlement Agreement; (4) appointing Hilsoft Notifications as Notice Administrator; (5) appointing the claims administrator agreed to by the Settling Parties as Claims Administrator; (6) appointing Ramona Trombley, Jeff Doehner, and Brian Wells as representative plaintiffs; (7) appointing Hassan A. Zavareei of Tycko & Zavareei LLP, as Settlement Class Counsel; and (8) scheduling a Final Fairness Hearing to consider final approval of the settlement.

After careful review and consideration of plaintiffs' motion and supporting memorandum, the objections of Robert Matos, supplemental briefing in response to the objections (including affidavits, declarations, and reports), and the arguments presented at the preliminary approval hearing and a subsequent telephone conference, the Court will grant plaintiffs' motion for preliminary approval subject to the terms and conditions set forth below. A separate order consistent with this Memorandum Opinion will be issued today.


Plaintiffs filed their class action on February 17, 2010, alleging that defendant National City Bank*fn1 engaged in unlawful and deceptive practices by improperly charging its customers overdraft fees for insufficient funds on debit card transactions in violation of various state and federal laws. Compl. ¶¶ 2, 13-14. Plaintiffs allege that National City Bank "reorder[ed] electronic debit transactions from the highest dollar amount to lowest dollar amount so as to deplete the customer's available funds as quickly as possible while maximizing the number of overdraft fees collected." Compl. ¶ 2. Plaintiffs also allege that National City Bank provided false and misleading account balance information and failed properly to disclose its overdraft policies. Id. The Court exercises jurisdiction over this class action pursuant to the Class Action Fairness Act of 2005, 28 U.S.C. § 1332.*fn2

In April 2010, the Court received notification from the U.S. Judicial Panel on Multidistrict Litigation ("MDL Panel") that a conditional transfer order had been entered, directing that this case be conditionally transferred to the Southern District of Florida to Multidistrict Litigation Proceeding No. 2036, In re Checking Account Overdraft Litigation ("MDL No. 2036"). On July 28, 2010, plaintiffs and National City Bank (collectively, "the parties") entered into a settlement agreement and filed an unopposed motion for preliminary approval in this Court. On August 9, 2010, the parties informed the MDL Panel that they had reached a settlement, and the MDL Panel then vacated its order to transfer the action to MDL No. 2036, thereby returning the case back to this Court to evaluate the proposed settlement. The MDL Panel's ruling, however, does not bar future transfer of the case to MDL No. 2036 if this Court does not approve the proposed settlement or does not fully resolve the case.

On August 13, 2010, Robert Matos ("Objector") appeared and filed his objections to the proposed settlement. Matos is the named plaintiff in Matos v. Nat'l City Bank, No. 10-CV-21771 (S.D. Fla. June 1, 2010), an overlapping class action that is part of MDL No. 2036. The Court held a hearing on November 18, 2010 and heard arguments from plaintiffs, National City Bank, and Objector relating to preliminary approval of the proposed settlement. On December 17, 2010, the Court also held a brief telephone conference with counsel for plaintiffs and National City Bank to discuss several concerns with the notice and release provisions of the settlement agreement. Following that discussion, the parties filed a renewed motion for preliminary approval, revised settlement agreement, and revised proposed order on December 22, 2010, and the Court then received a further response from Objector and reply from plaintiffs.

The terms of the Revised Settlement Agreement include the following:

* A Settlement Class of "[a]ll persons who hold or ever held a National City Account*fn3 who at any time during the Class Period incurred at least one Overdraft Fee*fn4 associated with at least one National City Debit Card Transaction*fn5 that was not previously reversed, refunded, or returned to the Settlement Class Member by Defendant."

* A $12,000,000 Settlement Fund, inclusive of all attorneys' fees, costs, expenses, and incentive payments to representative plaintiffs, from which Settlement Class Members will receive $36 for each eligible overdraft charge incurred during any two calendar months from July 1, 2004 to August 15, 2010, unless the total amount needed to pay valid claims exceeds funds available in the Settlement Fund. The two months need not be consecutive.

* National City Bank will also provide up to an additional $500,000 for published notice, administration of the settlement, and other notice and claims administration costs. If the costs exceed $500,000, the costs will be deducted from the Settlement Fund.

* If the amount claimed by Settlement Class Members is less than the remaining amount after attorneys' fees, costs, expenses, incentive awards, and notice and claims administration costs are paid, the remainder will be distributed on a pro rata basis, with each Settlement Class Member receiving up to (but not exceeding) three times the amount claimed. Any remaining funds will be distributed through a cy pres to a nonprofit organization or organizations agreed upon by Plaintiffs and National City Bank, and subject to approval by the Court.


Generally, preliminary approval of a class action settlement will be granted if it appears to fall "within the range of possible approval" and "does not disclose grounds to doubt its fairness or other obvious deficiencies, such as unduly preferential treatment of class representatives or of segments of the class, or excessive compensation for attorneys." Newberg on Class Actions, ยง 11:25 (4th ed. 2010) (quoting Manual for Complex Litigation, Third, ...

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