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Jeffrey Stein, et al v. Bank of America Corporation

August 28, 2012


The opinion of the court was delivered by: Reggie B. Walton United States District Judge


Jeffrey Stein and Rabindranauth Ramson, in their individual capacities and on behalf of all others similarly situated, seek injunctive and monetary relief for alleged violations of the Right to Financial Privacy Act (the "RFPA"), 12 U.S.C §3401 (2006), by Bank of America. Second Amended Complaint ("2d Am. Compl.") ¶¶ 118-22. Currently before the Court is the defendants' motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1) and 12(b)(6) for lack of subject matter jurisdiction and for failure to state a claim upon which relief can be granted. See Defendants' Motion to Dismiss the Second Amended Complaint ("Defs.' Mot."). For the reasons that follow, the Court concludes that it must grant the motion and dismiss this case for lack of subject matter jurisdiction.*fn1


The following facts are taken from the plaintiffs' Second Amended Complaint. Bank of America is a national banking association headquartered in Charlotte, North Carolina. 2d Am. Compl. ¶ 6. According to the plaintiffs, Bank of America established "a network of customer service call/data centers in the United States," which were "designed to provide Bank of America's customers with access to Bank of America personnel so such customers could fully utilize the financial services provided by Bank of America." Id. ¶ 47. In order to access these financial services, Bank of America customers were "directed to dial ten-digit, U.S.-exchange, 'domestic,' often-times toll-free telephone numbers," where Bank of America personnel had "access to the call customer's records." Id. ¶¶ 47-48.

As a result of "[a]dvances in communications technology," Bank of America "expand[ed] . . . [their] information network of U.S.-based call/data centers to an information network of foreign-based call/data centers located overseas," mainly staffed by foreign nationals. Id. ¶¶ 49-50 (emphasis added). As with U.S.-based call/data centers, foreign-based call/data centers were also provided with access to a customer's records. See id. According to the plaintiffs, however, because Bank of America has "established a seamless customer experience such that [customers] who communicate with Bank of America by dialing U.S. telephone numbers are not affirmatively notified that their financial records have been transferred to foreign nationals residing overseas." Id. ¶ 50. Bank of America "does not routinely direct [customers] to dial '011' to reach the international phone exchange, or dial the country, or city codes of any foreign telephone in order to reach its bank personnel." Id. ¶ 51. As such, customers have not "purposefully availed themselves of non-U.S. communications or services provided by foreign nationals who reside overseas." Id. ¶ 52, According to the plaintiffs, because the Constitution and other United States laws do not extend to foreign nationals, when Bank of America provides foreign nationals in one of Bank of America's foreign-based call/data centers with a call customer's financial records, "United States Government authorities may access such financial records without [any legal impediment.]" Id. ¶ 76. And again, according to the plaintiffs, the pervasive, foreign intelligence gathering activities conducted by the National Security Agency ("NSA") demonstrates the likelihood that the NSA has exploited, presently exploits or will exploit this absence of impediment. See id. ¶¶ 57-82.

On August 3, 2011, the plaintiffs filed their initial complaint with this Court and asserted, on behalf of three named plaintiffs and a putative nationwide class, two claims under the RFPA, seven claims under the District of Columbia Consumer Protection Procedures Act ("CPPA"), and claims for negligence, bailment and unjust enrichment. On October 6, 2011, one of the named plaintiffs, Priscilla Fuller, voluntarily dismissed her own cause of action. On October 11, 2011, the remaining plaintiffs amended their complaint and abandoned their CPAA claims. The defendants moved to dismiss the plaintiffs' First Amended Complaint for lack of subject matter jurisdiction and failure to state a claim and the plaintiffs sought and received consent to amend for a second time. On November 22, 2011, the plaintiffs filed their Second Amended Complaint and on December 23, 2011, the defendants again moved to dismiss for lack of subject matter jurisdiction and failure to state a claim.

The plaintiffs assert that the defendants have violated the RFPA because by "routing financial records to foreign nationals overseas . . . Bank of America provides the U.S. [with] access to such financial records" in direct contravention of 12 U.S.C. § 3403(a). See 2d Am. Compl. ¶¶ 113-15.

As noted, the defendants responded with a motion to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) for lack of standing and, alternatively, 12(b)(6) for failure to state a claim. As to the first position, the defendants argue that the alleged injury is too abstract to confer standing. As to the second position, the defendants argue a fatal lack of support for the plaintiffs' claims. However, because the Court agrees with the defendants that the plaintiffs' Second Amended Complaint fails to plead an injury in fact, this Memorandum Opinion addresses only the 12(b)(1) arguments.


A motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) presents "a threshold challenge to the court's jurisdiction." Morrow v. United States, 723 F. Supp. 2d 71, 75 (D.D.C. 2010) (quoting Haase v. Sessions, 835 F.2d 902, 906 (D.C. Cir. 1987)). The plaintiff bears the burden of establishing by a preponderance of the evidence that the court has subject matter jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). Accordingly, "the [p]laintiff's factual allegations in the complaint . . . will bear closer scrutiny in resolving [the motion]," Grand Lodge of Fraternal Order of Police v. Ashcroft,185 F. Supp. 2d 9, 13-14 (D.D.C. 2001), and "the court need not limit itself to the allegations of the complaint," id. at 14. Instead, "a court may consider such materials outside the pleadings as it deems appropriate to resolve the question [of] whether it has jurisdiction [in] the case." Scolaro v. D.C. Bd. of Elections & Ethics, 104 F. Supp. 2d 18, 22 (D.D.C. 2000).


The defendants argue that the Court lacks subject matter jurisdiction because the plaintiffs have not demonstrated their standing to bring the claims currently before the Court. And because a standing challenge presents a challenge to the Court's jurisdiction, the Court must address these arguments first. See Haase, 835 F.2d at 906 ("[T]he defect of standing is a defect in subject matter jurisdiction.").

The "irreducible constitutional minimum of standing," Lujan, 504 U.S. at 560, requires that three elements be satisfied:

First, the plaintiff must have suffered an injury in fact-an invasion of a legally protected interest which is (a) concrete and particularized, [and] (b) actual or imminent, not conjectural or hypothetical. Second, there must be a causal connection between the injury and the conduct complained of-the injury has to be fairly traceable to the challenged action of the defendant, and not the result of the independent action of some third party not before the court. ...

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