Indiana Court of Appeals Affirms Denial of Summary Judgment in Old National Bank Overdraft Fee Litigation

May 27, 2016

The Indiana Court of Appeals has upheld the decision of the trial court denying Old National Bank’s (NASDAQ: ONB) ( motion for summary judgment in an overdraft fee case brought on behalf of ONB customers. The Court of Appeals rejected ONB’s argument that the National Bank Act preempted the state law claims of the plaintiffs who allege that ONB breached its duty of good faith and fair dealing to its customers by manipulating their account balances to maximize overdraft fees incurred on everyday purchases made with their debit cards and ATM withdrawals. In a unanimous 19-page opinion, Old Nat. Bank v. Kelly, —N.E.3d— (Ind. Ct. App. Apr. 23, 2015), the Court stated, “a customer purchasing a two dollar coffee would unwittingly incur a $30-plus overdraft fee,” quoting from the opinion of Judge William Alsup of the United States District Court for the Northern District of California who, in 2010, entered a $203 judgement against Wells Fargo in a case brought by customers of that bank alleging similar practices. ONB has sought transfer to the Indiana Supreme Court.

Sweetnam LLC and its principal, William M. Sweetnam, are lead counsel for the certified class.