James Lossia, Jr. v. Flagstar Bancorp, Inc., 895 F.3d 423

Plaintiffs James Lossia, Jr. and Alexandra Plapcianu held a joint Flagstar checking account governed by Flagstar’s ‘‘Terms and Conditions’’ (the Agreement).
The Agreement states Flagstar’s policy is to process ACH items “first—as they occur on their effective date for the business day on which they are processed,” and incorporates applicable payment-processing rules.
NACHA Operating Rules (Guidelines) define an ACH transaction’s “effective date” as the date the Originator specifies for settlement and which the ACH Operator (Federal Reserve) conveys in batch files to the RDFI (Flagstar).
Lossia authorized ten ACH debits over Feb 25–28, 2015; all were posted on March 2, 2015, in the order Flagstar received them from the Federal Reserve’s batch files—not in the order Lossia said he initiated them.
Lossia incurred eight overdraft fees initially; Flagstar’s system automatically flags >5 overdrafts and the bank manually reversed excess fees the next business day, reducing Lossia’s net fees to no more than five.
District court granted summary judgment to Flagstar; Lossia appealed only the breach-of-contract claims challenging (1) processing order and (2) alleged violation of the five-fee-per-day cap.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the Agreement required Flagstar to process ACH debits in the order Lossia initiated them	"Occur" means the sequence a customer initiates transactions, so Flagstar breached by reordering and causing extra overdrafts	Agreement ties processing to transactions’ "effective date" as supplied via NACHA/Fed batch files; Flagstar processes in the order received and did so here	Court held Agreement does not require customer-initiation order; Flagstar processed per effective-date/batch-order and did not breach
Whether posting eight overdraft charges violated the Agreement’s cap of five NSFs per business day	Initial posting of eight fees breached the five-fee cap and caused damages	Bank’s procedure reverses excess fees the next business day; plaintiff ultimately paid no more than five fees so no damages	No breach/damages: excess fees were reversed; plaintiffs cannot represent a class on a claim where they suffered no injury

Borman, LLC v. 18718 Borman, LLC, 777 F.3d 816 (6th Cir.) (standard of review for summary judgment)
Latits v. Phillips, 878 F.3d 541 (6th Cir.) (summary judgment evidence viewed in favor of nonmoving party)
Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (summary-judgment nonmoving-party burden requires more than metaphysical doubt)
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (mere scintilla of evidence insufficient to avoid summary judgment)
Celotex Corp. v. Catrett, 477 U.S. 317 (summary-judgment evidence need not be in trial-admissible form if it can be presented admissibly)
Klapp v. United Ins. Grp. Agency, Inc., 663 N.W.2d 447 (Mich.) (contracts construed as a whole; avoid surplusage)
Forge v. Smith, 580 N.W.2d 876 (Mich.) (extraneous documents properly incorporated when referenced)
Miller-Davis Co. v. Ahrens Const., Inc., 817 N.W.2d 609 (Mich. Ct. App.) (elements of breach-of-contract: contract, breach, damages)