According to the Kay Jewelers class Action lawsuit, a common debit card sale under the name “kay jewelers” requires that a consumer enter his or her PIN in order to make a purchase. However, since a blind or physically impaired person is unable to readily comprehend the numerical representations displayed on the POS Device’s keypad, such person generally does not have the capability to “decide” which item to buy. In this way, the plaintiff argues that this case is different from others brought against major credit card companies that use the same terms when describing their transactions, such as “prepaid MasterCard.” Further, as previously noted, a major company may use different terms when describing an instance of card fraud, such as “credit card fraud.” Thus, in this case, it is not necessary for the plaintiff to prove that he or she was not aware that the terms used by the defendants with respect to debit card transactions were deceptive.
Kay Jewelers is one of many plaintiffs suing defendants in what is known as the “skimming” case, which is based on the theory that a bank or credit card company purposefully “skims” cardholders’ transactions to achieve certain results. (The skimming occurs when a bank or card issuer alter the way in which a cardholder processes his or her transaction in order to extract more money from the consumer.) Plaintiffs argue that banks and other defendants engage in this fraud in a fashion similar to how thieves to skim personal information from wallets and purses to commit credit card fraud. According to plaintiffs in this case, defendant Metromile Corporation engaged in this type of deception when it placed a logo on some of its debit cards that suggested they were issued by “Kleen Jewelers,” when in reality they were “issueless” accounts.
According to court documents, defendant Metromile created several debit cards that were “issueless” for a period of time, allowing defendant Metromile to circumvent the “skimming” rule and collect fees from consumers. At one point, defendant Metromile created a new logo featuring an eagle and said that it represented the Credit Card Fraud Class Action Lawsuit. The logo was also used by a number of banks in an effort to avoid having to pay the fees accrued by the “issueless” accounts.
The fraudulent acts of defendant Metromile motivated a number of plaintiffs in the Class Action Lawsuit to file a complaint against Metromile and other defendants in the United States that were involved in the skimming fraud. The complaint alleged that defendants violated the Fair Debt Collection Practices Act, the Fair Credit Billing Act, the Truth in Lending Act, the Fair Trading Act, and other federal laws. Additionally, the complaint alleged that defendants had engaged in fraudulent and deceptive acts and practices, including violations of the Fair Debt Collection Practices Act, the Truth in Lending Act, the Fair Credit Billing Act, the Deceptive Car Racing Act, and the Truth in Debt Collection Practices Act. Plaintiffs further alleged that defendants did not timely inform the plaintiffs of their liability for the frauds, as required by law; failed to make reasonable efforts to correct the errors that they had made; failed to take reasonable steps to eliminate the frauds, and finally, did not respond to the plaintiffs’ requests for refunds and other defenses to the fraud claims.
On December 4, 2021, plaintiffs filed a complaint in the United States District Court for the Northern District of California against defendant Metromile, Inc. and defendant Mark Group IV, a corporation based in San Francisco, California. After a two-week trial, the court entered a judgment in favor of plaintiffs and granted a permanent injunction. In addition to granting a permanent injunction, the court ordered defendant Metromile to pay costs associated with the frauds. The court also enjoined Mark Group IV from continuing to engage in the same types of illegal activities. Additionally, the court ordered defendant Metromile to pay damages to the individual that was the subject of the fraud.
Plaintiffs filed a claim for damages under the Class Action Law. Plaintiffs contend that they were the victims of frauds; that defendant Metromile and Mark Group IV, in violation of the Fair Debt Collection Practices Act, engaged in predatory and abusive conduct; that the defendants violated the rights of their victims by subjecting them to such acts, and that they further defrauded plaintiffs of their rights by failing to provide evidence in support of their claims. The defendants argue that their alleged actions do not constitute fraud or deceit, but rather, are efforts to provide services that are needed in an increasingly challenging economy. They further assert that their claims are barred by the Due Process Clause of the Fifth Amendment to the United States Constitution and state laws. Plaintiffs are seeking monetary damages and an injunction against further encroachment of their rights under the FDCPA.
