May 15 A federal judge has again ordered Wells
Fargo & Co to pay $203 million to settle class action
litigation accusing it of imposing excessive overdraft fees on
checking account customers, reviving an award that had been
thrown out last year.
U.S. District Judge William Alsup on Tuesday reinstated a
penalty he had first imposed in August 2010, saying the
fourth-largest U.S. bank violated a California law that protects
consumers against fraudulent representations.
Wells Fargo spokeswoman Richele Messick said the San
Francisco-based bank plans to appeal. "We don't believe that the
ruling is in line with facts of this case or the law," she said.
Overdraft fees are typically $25 or $35, and are incurred by
consumers who overdraw their checking accounts, often by making
purchases with debit cards.
Wells Fargo had been accused of processing such purchases
from largest to smallest rather than chronologically, to
maximize the number of overdraft fees it could charge.
In December, the 9th U.S. Circuit Court of Appeals threw out
the original award, saying federal law displaced part of a
California state law on which Alsup relied in imposing a related
injunction on Wells Fargo.
But it said federal law did not displace California consumer
law with respect to fraudulent or misleading representations,
and directed Alsup to decide again what relief was appropriate.
The case is Gutierrez et al v. Wells Fargo Bank NA, U.S.
District Court, Northern District of California, No. 07-05923.