Humphrey v. Stored Value Cards
355 F. Supp. 3d 638
N.D. Ohio2019Background
- Plaintiff Amber Humphrey was jailed in Aug–Sep 2017; the jail took her $60, placed it in an inmate trust, and on release gave her a validated Numi-branded prepaid debit card funded from that trust (held by Republic Bank in a pooled account).
- Humphrey and other released inmates did not receive (or dispute receiving) card terms at issuance; Humphrey used the card for purchases and ATM withdrawals.
- The card charged various high fees (e.g., $2.95 ATM withdrawal, $1.50 balance inquiry; $5.95 monthly maintenance after a five-day free-check window); paper checks were free only if requested within five days.
- Republic sponsored and controlled the program and funds; Numi marketed and serviced the cards and contracted with jails to distribute cards and provide terms to inmates on release.
- Plaintiffs sued under the Electronic Funds Transfer Act (EFTA) alleging: (1) unlawful issuance of unsolicited/activated debit cards (15 U.S.C. § 1693i) and (2) unlawful service fees on general-use prepaid cards (15 U.S.C. § 1693l-1). They also asserted Ohio unjust enrichment and conversion claims.
- Court disposition: denied Defendants’ motion to dismiss; granted in part and denied in part Defendants’ motion for summary judgment (denied summary judgment on §1693i and on Ohio unjust enrichment and conversion; granted summary judgment for Defendants on §1693l-1).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether issuance of validated prepaid cards from a pooled custodial account violates EFTA §1693i (unauthorized issuance) | Humphrey: cards were unsolicited, validated, and enabled transfers from her account; EFTA covers these accounts so issuance is unlawful | Defendants: funds held in a pooled custodial account are not a "consumer asset account" under Regulation E, so §1693i doesn't apply | Denied summary judgment for Defendants — pooled account does not remove EFTA coverage; genuine issue remains for trial |
| Whether service fees are prohibited under §1693l-1 as fees on "general-use prepaid cards" | Humphrey: cards function as general-use prepaid cards and fees thus barred | Defendants: cards are not marketed to the general public (they are issued to released inmates), so the statutory exception for non‑public marketing applies | Granted summary judgment for Defendants on §1693l-1 — cards were not marketed to the general public |
| Whether unjust enrichment claim fails because fees were authorized by a contract between Numi and the county or by an alleged contract with cardholders | Humphrey: even if a county contract existed, unsolicited issuance and retention of fees could be unlawful; many inmates never assented to terms | Defendants: contract with county and cardholder usage (or terms acceptance) bar unjust enrichment | Denied summary judgment for Defendants — factual disputes about assent and the lawfulness of issuance preclude summary judgment |
| Whether conversion claim fails because funds were not specific/identifiable (pooled account) | Humphrey: inmate funds were held in an inmate trust and are therefore specific/identifiable for conversion purposes | Defendants: pooled custodial account means funds not separately identifiable, so conversion not available | Denied summary judgment for Defendants — record supports that funds were held in trust and could be specific/identifiable for conversion |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment standard)
- Circuit City Stores, Inc. v. Adams, 532 U.S. 105 (statutory interpretation guidance regarding lists and ejusdem generis)
- Heiges v. JPMorgan Chase Bank, N.A., 521 F. Supp. 2d 641 (N.D. Ohio 2007) (card use can indicate agreement to terms in a context where consumer opened the account)
- Gen. Motors Corp. v. Keener Motors, Inc., 194 F.2d 669 (6th Cir. 1952) (requirements for a definite offer)
- R.J. Wildner Contracting Co. v. Ohio Tpk. Comm’n, 913 F. Supp. 1031 (N.D. Ohio 1996) (unjust enrichment barred where express contract covers same subject)