Bloomberg News

Citizens Bank, Customers Seek Mediation in Overdraft Suit

March 13, 2012

Citizens Bank of Pennsylvania and plaintiffs in a lawsuit challenging overdraft fees asked for a delay in proceedings while they pursue private mediation, according to a court filing.

“The parties have agreed to engage in private mediation in an effort to resolve this case without further litigation,” the Pittsburgh-based bank and the customers said today in a filing in federal court in Miami. They agreed to suspend court filings on whether to certify the case as a class-action, or group, lawsuit. A mediation session is scheduled for April 17, according to the filing.

At least 30 banks have cases before U.S. District Judge James Lawrence King in Miami. The customers say the banks reorder debit-card transactions in their computers to maximize overdraft fees.

JPMorgan Chase & Co. (JPM), the biggest U.S. bank by assets, has reached a preliminary agreement to pay $110 million to settle litigation. Bank of America Corp. (BAC), the second-biggest U.S. bank by assets, agreed last year to pay $410 million without admitting liability.

Union Bank NA agreed to a $35 million settlement with customers in November. An Associated Banc-Corp. unit, Associated Bank, agreed in November to pay $13 million.

The case is In re Checking Account Overdraft Litigation, 09-md-02036, U.S. District Court, Southern District of Florida (Miami).

To contact the reporter on this story: David Beasley in Atlanta at dbeasley4@yahoo.com

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.


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