2:17-cv-00051
W.D. Mich.Jan 17, 2018Background
- Plaintiff James Wheeler sued Native Commerce Studios, LLC as a putative class action asserting: (1) Michigan Consumer Protection Act violation; (2) fraudulent concealment; (3) breach of contract; and (4) violation of the Electronic Funds Transfer Act (EFTA).
- The EFTA claim alleges Native enrolled Wheeler in a membership and made recurring debits from his account without proper authorization after he purchased a lighter in January 2016.
- The complaint was filed March 17, 2017. The parties do not fix the exact date of the first debit, but the court accepted that the first recurring debit occurred more than one year before filing.
- EFTA (15 U.S.C. § 1693m(g)) requires suit within one year from the date of the occurrence of the violation.
- Wheeler argued the limitations period runs anew for each unlawful debit, allowing recovery for debits within the 12 months before filing; Native argued the limitations period began with the first recurring transfer, barring the claim.
- The court concluded the one-year limitations period began at the first recurring transfer (following Sixth Circuit precedent and the majority of district courts) and dismissed Wheeler’s EFTA claim as time-barred.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether EFTA's one-year limitations period runs from each individual unauthorized debit or from the first recurring transfer | Each unauthorized debit is a separate "occurrence," so Wheeler can sue for any debits within one year of filing | Limitations began with the first recurring transfer; if that first transfer was >1 year before filing, the EFTA claim is time-barred | Court held limitations began at the first recurring transfer; EFTA claim dismissed as untimely |
Key Cases Cited
- Wike v. Vertrue, Inc., 566 F.3d 590 (6th Cir. 2009) (one-year limitations period for recurring EFTA transfers begins when the first recurring transfer took place)
- Bay Area Laundry & Dry Cleaning Pension Trust Fund v. Ferbar Corp. of Cal., Inc., 522 U.S. 192 (1997) (statute of limitations begins when plaintiff has a complete and present cause of action)