Big ATM operator sanctioned over access for the blind

Fri Mar 22, 2013 1:02pm EDT

* Cardtronics did not comply with 2007 nationwide settlement

* Judge says to impose "significant" fine

* Cardtronics says most of its ATMs comply with disability law

By Jonathan Stempel

March 22 (Reuters) - Cardtronics Inc has been sanctioned by a federal judge and faces a significant fine after the largest independent U.S. ATM operator failed to live up to a 2007 class action settlement intended to make its machines accessible to the blind.

The accord with Massachusetts and the National Federation of the Blind called for Cardtronics by July 2010 to install voice guidance features that could be activated by plugging headphones into jacks on its ATMs.

Many Of Cardtronics' machines are located in convenience stores such as 7-Eleven, drugstores including Walgreen's and CVS, gas stations such as Chevron and supermarkets such as Safeway.

After Cardtronics missed the deadline, U.S. District Judge Nathaniel Gorton in Boston gave it until March 15, 2012 to comply. But by July, however, as many as 27,800 ATMs were still not equipped as required, according to the plaintiffs.

In a decision dated Thursday, Gorton said Cardtronics has conceded that it remains out of compliance with the settlement, though the Houston-based company tried to comply in good faith. The lawsuit began in 2003.

Gorton said Cardtronics agreed to three sanctions proposed by the plaintiffs: appointment of a special master to monitor enforcement, an extension of monthly reporting requirements through March 2014, and payment of the plaintiffs' legal fees.

The plaintiffs also sought a fine, and Gorton said he will impose a fine "in some significant amount" at a hearing.

"Having conceded their failure to meet at least some of the requirements imposed by the plan, the defendants' violation is clear and they must be prepared to face the consequences," Gorton wrote. Two Cardtronics entities were named as defendants.

In a statement on Friday, Cardtronics said it has had to overcome "technical and operational hurdles that have been more challenging than originally anticipated."

But it said that apart from "sporadic maintenance issues," its ATMs complied with the Americans with Disabilities Act as of March 15, 2012, and that it now operates more than 43,000 ADA-compliant ATMs.

Cardtronics has more than 62,800 retail ATMs worldwide.

Jillian Fennimore, a spokeswoman for Massachusetts Attorney General Martha Coakley, declined to comment.

The 2007 settlement also involved banking policies of online brokerage E*Trade Financial Corp that the plaintiffs said derived from the claims over the ATMs. Cardtronics bought roughly 13,000 ATMs from E*Trade in 2004.

The case is Massachusetts et al v. E*Trade Access Inc et al, U.S. District Court, District of Massachusetts, No. 03-11206.