United States: ATM Fee-Notice Litigation, Part II: Moving To Dismiss For Lack Of Standing

This article is part of a series: Click ATM Fee-Notice Litigation, Part I: Electronic Fund Transfer Act Basics for the previous article.

Originally published February 23, 2012

In this installment of our advisory, we discuss the strategy of moving to dismiss a fee-notice litigation on the grounds that a plaintiff lacks constitutional standing to bring suit under the Electronic Fund Transfer Act ("EFTA"). After explaining the standing doctrine, we argue that a plaintiff who has prior notice of an ATM fee cannot establish an injury in fact or causation. Next, we analyze two contrary cases decided under EFTA and propose a response to them based on controlling precedents. Finally, we look at First American Financial Corp. v. Edwards, a case pending before the United States Supreme Court, and recommend that defendants consider moving in the alternative for a stay of litigation.

Standing Doctrine Under Article III of the Constitution, federal courts can hear only disputes that raise an actual case or controversy between the parties. The purpose of this requirement is to restrict judicial power "to the traditional role of Anglo-American courts, which is to redress or prevent actual or imminently threatened injury to persons caused by private or official violation of law."1 To have standing, a plaintiff must demonstrate (1) that he or she suffered a concrete, particularized "injury in fact"; (2) that the defendant's action caused the claimed injury; and (3) that the claimed injury would likely be "redressed by a favorable decision."2 Where any one of these elements is missing, a federal court lacks subject-matter jurisdiction and the case must be dismissed.3

No Injury in Fact There is a strong argument that a plaintiff claiming that a defendant failed to post physical signage of an ATM fee—even though the fee was electronically disclosed on the ATM screen—cannot make the injury-in-fact showing. Because the on-screen notice made the plaintiff aware of the fee, he or she was not misled or otherwise harmed by the absence of physical signage. Thus, in those circumstances, the plaintiff suffered no concrete, particularized injury in fact.

This argument is supported by cases decided outside of the EFTA context. For example, in Cargill, Inc. v. United States, the plaintiffs claimed that, by failing to give notice that an agency had been reestablished, the defendant violated regulations promulgated under the Federal Advisory Committee Act.4 According to the Fifth Circuit, while there may have been "technical violations of the [regulatory] notice rules," the plaintiffs had actual notice of the agency's continued operation because the plaintiffs had been meeting with the agency and its personnel.5 In light of that actual notice, the Fifth Circuit held that the plaintiffs suffered no injury in fact and "therefore lack[ed] standing to assert the claim at hand."6

Another example is Central Arizona Irrigation & Drainage District v. Lujan,7 which arose out of the Secretary of the Interior's proposal to amend a water-supply contract to allow recharge of entitlements to groundwater.8 The plaintiffs brought suit in the United States District Court for the District of Arizona claiming that the notice of the proposed amendment violated the Reclamation Reform Act because the notice did not identify the recharge provisions. According to the court, however, the plaintiffs had "discussed [the recharge] provisions with the Department of the Interior on numerous occasions" and "had complete, actual knowledge about [those] provisions."9 Accordingly, despite the alleged statutory violation, the court held that the plaintiffs suffered no injury in fact and lacked standing.10

The parallels to fee-notice litigation are plain. For the same reason that there was no injury in fact in Cargill and Central Arizona, no injury in fact should be found where a fee-notice plaintiff had actual knowledge of an ATM fee. Where there was on-screen notice, any missing physical signage caused no "invasion of a legally protected interest that is both concrete and particularized[,] and actual or imminent, not conjectural or hypothetical."11

No Causation Beyond requiring proof of injury in fact, standing demands a causal connection between the claimed injury and the defendant's actions.12 Where a plaintiff inflicts his or her own injury, the causal chain is thrown into question. As a leading treatise explains, "[t]olerance for self-inflicted injury is not boundless. At some point, standing may be denied because the injury seems solely—or almost solely—attributable to the plaintiff."13 In the ordinary fee-notice case, the core "injury" was self-inflicted. Many plaintiffs hunt for non-conforming ATM signage for the sole purpose of commencing litigation. Moreover, using a modern ATM, a consumer must affirmatively agree to pay an ATM fee by pushing a button or on-screen prompt before the transaction can be completed. That type of voluntary conduct undercuts a plaintiff's claim to have standing.

Contrary EFTA Caselaw Defendants should be aware of two contrary cases decided under EFTA. The plaintiffs in In re: Regions Bank ATM Fee Notice Litigation14 and Kinder v. Dearborn Federal Savings Bank15 alleged that the defendants violated EFTA by failing to provide physical notice of ATM fees. In both cases, the defendants moved to dismiss, arguing plaintiffs lacked standing because the plaintiffs received on-screen notice of the fees. The district courts rejected that argument, holding that the missing physical signage was an EFTA violation, which itself serves as an Article III injury. In a passage followed by Kinder, the Regions court explained:

That Congress included two forms of damages—actual and statutory—is clear evidence that Congress intended to create a statutory right and a mechanism to redress violations [of EFTA]. Regardless of whether Plaintiffs were aware of the ATM fee, they were entitled to notice of the fee in the form prescribed by Congress . . . . Congress created a statutory right to a particular form of notice, and Plaintiffs allege that Defendant did not provide it. That is a concrete, particular injury.16

But the district courts nowhere recognized (much less analyzed) the following United States Supreme Court precedents establishing that a statutory violation—untethered to any harm caused by the challenged action—cannot create standing:

  • Summers v. Earth Island Institute: "[T]he requirement of injury in fact is a hard floor of Article III jurisdiction that cannot be removed by statute."17
  • Raines v. Byrd: "Congress cannot erase Article III's standing requirements by statutorily granting the right to sue to a plaintiff who would not otherwise have standing."18
  • Valley Forge Christian College v. Americans United for Separation of Church & State, Inc.: "Neither the Administrative Procedure Act, nor any other congressional enactment, can lower the threshold requirements of standing under Art. III."19

Thus, despite the holding in Regions and Kinder, an EFTA claim made in a harm-free vacuum should fall below the "hard floor of Article III jurisdiction."20

First American In First American Financial Corp. v. Edwards,21 the Supreme Court of the United States is poised to issue a decision that that will likely crystallize whether cases like Regions and Kinder can survive scrutiny. The plaintiff commenced First American alleging that the defendants engaged in a kickback scheme when they sold her title insurance, thereby violating the Real Estate Settlement Procedures Act of 1974 ("RESPA").22 The defendants moved to dismiss, arguing that the plaintiff lacked Article III standing because she alleged no insurance overcharge or any other injury in fact. The lower court denied the motion,23 and the Ninth Circuit affirmed.24 Traveling the same path as the Regions and Kinder courts, the Ninth Circuit reasoned that "[t]he injury required by Article III can exist solely by virtue of statutes creating legal rights, the invasion of which creates standing." 25The court then held: "Because [RESPA] does not limit liability to instances in which a plaintiff is overcharged, we hold that Plaintiff has established an injury sufficient to satisfy Article III."26

The defendants appealed to the United States Supreme Court.27 Briefing was completed on November 10, 2011 (briefs available here), and oral argument was held on November 28, 2011 (transcript available here). No decision has yet been issued.

However First American is decided, the case is likely to impact litigation under EFTA. Like the typical fee-notice plaintiff, the plaintiff in First American claims that a statutory violation alone is sufficient to establish Article III jurisdiction. That reasoning came under fire during oral argument. As Chief Justice Roberts remarked:

You said violation of a statute is injury in fact. I would have thought that would be called injury in law. And when we say . . . that what is required is injury in fact, I understand that to be in contradistinction to injury in law. And when you tell me all that you've got . . . is violation of the statute, that doesn't sound like injury in fact.28

Fee-notice defendants will have reason to cheer if the Ninth Circuit is reversed because it misconstrued Article III's injury-in-fact requirement. But in any event, all EFTA litigants will want to pay attention to what the Court ultimately decides. The case can be tracked here or here.

Stay of Litigation In light of First American, a fee-notice defendant may want to couple its motion to dismiss with an alternative request for a stay of the litigation. This was the approach taken by the defendant in Mabary v. Hometown Bank, N.A.,29 a fee-notice case commenced as a putative class action in the United States District Court for the Southern District of Texas. After the court certified a class,30 the defendant moved to dismiss the case for lack of Article III jurisdiction or, alternatively, to stay the case pending the outcome of First American.31 The court issued orders (without a written decision) decertifying the class and staying the case.32

Conclusion The standing argument could be a silver-bullet defense, even in the wake of Regions and Kinder. The key is to persuade courts that, absent actual injury, a technical EFTA violation cannot establish standing. The precedents cited above, including Summers and Cargill, should aid a defendant who makes that argument. Whether First American will provide defendants with additional ammunition is something we will soon learn (in all likelihood, within the next few months).

* * *

In our next installment of this advisory, we will discuss offers of judgment in the fee-litigation context.


1 Summers v. Earth Island Inst., 555 U.S. 488, 492 (2009).

2 Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992) (internal quotations omitted).

3 See, e.g., id.; Ford v. NYLCare Health Plans of Gulf Coast, Inc., 301 F.3d 329, 332 (5th Cir. 2002).

4 173 F.3d 323, 332 (5th Cir. 1999).

5 Id.

6 Id.

7 764 F. Supp. 582 (D. Ariz. 1991).

8 Id. at 585.

9 Id. at 595.

10 Id.

11 Cargill, 173 F.3d at 329 (internal quotations omitted) (citing Lujan, 504 U.S. at 560).

12 Lujan, 504 U.S. at 560-61.

13 13A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 3531.5 (3d ed. 1997) (collecting cases).

14 No. 2:11–MD–2202, 2011 WL 4036691 (S.D. Miss. Sept. 12, 2011).

15 No. 10-12570, 2011 WL 6371184 (E.D. Mich. Dec. 20, 2011).

16 Regions, 2011 WL 6371184, *4 (emphasis in original).

17 555 U.S. at 497.

18 521 U.S. 811, 820 n.3 (1997).

19 454 U.S. 464, 487 n.24 (1982).

20 Summers, 555 U.S. at 497.

21 No. 10-708, (U.S.) (cert. granted in part by 131 S. Ct. 3022).

22 Edwards v. First Am. Corp., 517 F. Supp. 2d 1199, 1201 (C.D. Cal. 2007).

23 Id. at 1204.

24 610 F.3d 514, 518 (9th Cir. 2010).

25 Id. at 517 (internal quotations and citations omitted).

26 Id.

27 131 S. Ct. 3022.

28 Tr. of Oral Argument at 32-33, First Am., No. 10-708 (U.S.).

29 No. 4:10-CV-3936 (S.D. Tex. filed Oct. 19, 2010).

30 2011 WL 5864325 (S.D. Tex. Nov. 22, 2011).

31 No. 4:10-CV-3936 (S.D. Tex.) (ECF No. 43).

32 No. 4:10-CV-3936 (S.D. Tex.), Minute Entry dated Dec. 5, 2011, and Order dated Dec. 21, 2011 (ECF No. 52).

To read Part I in this series, please click on the 'Previous Page' link below.


This update is for information purposes only and should not be construed as legal advice on any specific facts or circumstances. Under the rules of the Supreme Judicial Court of Massachusetts, this material may be considered as advertising.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

This article is part of a series: Click ATM Fee-Notice Litigation, Part I: Electronic Fund Transfer Act Basics for the previous article.
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions