A bank customer sued the bank after an unknown individual changed the customer’s account phone number and email, reset the password, and fraudulently transferred hundreds of thousands of dollars out of the account. The bank did not notify the customer of these changes. The fraudster initiated seven wire transfers, and the bank authorized five before its fraud department contacted the customer to verify the activity. The customer alleged that the bank acted negligently by failing to exercise reasonable care and by not providing a security alert when the account information was altered. The customer also sought a declaratory judgment that two contracts, the Commercial Bank Services Agreement (the “CBSA”) and the Online and Mobile Banking for Business Services Agreement (the “OMBBA”), were both procedurally and substantively unconscionable. These agreements were entered into by the customer through the customer’s continued use of the account following the bank’s successive acquisitions. The bank moved to dismiss under Rule 12(b)(6), and the customer opposed the motion.
In Kountry v. Truist Bank, No. 2:24-cv-0036-JLB-NPM, 2025 WL 744271, 2025 U.S. Dist. LEXIS 41045 (M.D. Fla. Mar. 7, 2025) (opinion not yet released for publication), the court granted the bank’s motion to dismiss. Applying Rule 12(b)(6), the court viewed the facts in the light most favorable to the customer and assumed the allegations were true, but found the customer’s claims failed. The bank argued the customer had not sufficiently alleged that the CBSA and OMBBA were procedurally and substantively unconscionable, and the court agreed. It explained that, under state law, both forms of unconscionability must be present to warrant judicial intervention, although they do not have to exist to the same degree. However, the court concluded that the customer failed to plead facts supporting procedural unconscionability. The customer merely alleged that the contracts were referred to in bank statements and not provided in hard copy, but cited no authority requiring paper delivery and admitted the contracts could be accessed online or at a branch. Because the customer had acknowledged the agreements and did not challenge the bank’s authority to modify account terms, the court held the customer’s allegations were insufficient. The court next addressed the customer’s argument that the CBSA’s unilateral change-in-terms provision was substantively unconscionable. It disagreed, finding the provision neither unreasonable nor unfair, and not so one-sided as to shock the conscience. The court also rejected the claim that the CBSA’s limitation-of-liability clause was buried in the documentation and held that the provision’s language was clear. As to the negligence claim, the bank argued that neither state law nor the parties’ agreements imposed a duty to investigate the transactions, and that the claim was barred by Article 4 of the Uniform Commercial Code (UCC). The court agreed and held that the customer had failed to establish any such legal duty. The court declined to address the bank’s remaining UCC and contractual arguments because no duty existed regardless. Ultimately, the court dismissed all of the customer’s claims with prejudice.
By Callighan Ard [email protected]
Edited By Jace Brown [email protected]
Edited By Kristin Meurer [email protected]
Edited By Hayden Mariott [email protected]