The Court of Appeals for the Second Circuit has affirmed the dismissal of an Electronic Fund Transfer Act lawsuit that accused a credit union of failing to reverse a charge the plaintiff disputed.
The background: The case grew out of a dispute over a car repair the plaintiff believed she had already covered.
- The plaintiff, who represented herself throughout, alleged that a car dealership double-charged her for services covered by a warranty.
- After she disputed the transaction, she claimed the credit union violated the EFTA by declining to refund the first of the two charges.
- She sued both companies, pairing the EFTA claim against the credit union with state-law claims against the dealership.
- The defendants moved to dismiss, arguing the court lacked jurisdiction and that she had not stated a valid federal claim.
- A District Court judge in New York granted the motions, finding she had not stated an EFTA claim, had not shown a separate basis for keeping her state-law claims in federal court, and could not fix the problems by amending.
The ruling: The Appeals Court affirmed, holding that the plaintiff had described her own dissatisfaction with a service rather than the kind of unauthorized transfer the EFTA was written to police.
- The court first noted that the plaintiff never challenged the core parts of the lower court’s decision on appeal, which meant she had abandoned the issues that decided her case.
- Even so, the judges reached the merits, explaining that the EFTA covers a transfer initiated by someone other than the consumer, without authority, and from which the consumer gets no benefit. Here, the plaintiff had authorized the payment herself and simply felt the service fell short.
- On the state-law claims, keeping them in federal court would have required showing the parties were from different states and that more than $75,000 was at stake, neither of which she had alleged.
- The court declined to weigh new claims she raised for the first time on appeal.
- The panel closed with a pointed warning, observing that she had filed a run of meritless appeals over the past three years and stating flatly that this one was “also frivolous.” It cautioned that continued filings could trigger a sanction requiring her to obtain the court’s permission before submitting anything further.
