93 F.4th 205
4th Cir.2024Background
- Yagoub Mohamed, a self-employed worker in Maryland, applied for Pandemic Unemployment Assistance (PUA) benefits during the COVID-19 pandemic, which were distributed via a Bank of America prepaid debit card.
- Mohamed did not receive his card until December 2020. When he attempted to activate it, he discovered the full $14,644 in benefits had already been spent without his authorization.
- After reporting the issue and a series of confusing responses from the Bank, Mohamed filed a claim alleging violations of the Electronic Fund Transfer Act (EFTA) and state law.
- The district court dismissed Mohamed’s federal claims, finding his benefits were not held in a covered “account” under the EFTA.
- Mohamed appealed, arguing his account was a “government benefit account” as defined by relevant regulations, and thus covered by EFTA protections.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Mohamed’s benefits were held in an “account” protected by EFTA | The benefits were held in a government benefit account established by a Maryland agency and thus covered by EFTA via 12 C.F.R. § 1005.2(b)(3)(i)(B) | The account was not “established by a government agency” but by the bank, so EFTA does not apply | The account was established by the state agency for the purpose of distributing government benefits, thus covered by EFTA |
| Forfeiture of Subsection B argument | Mohamed’s filings sufficiently raised the Subsection B (government benefit account) theory | Mohamed didn’t adequately argue Subsection B in the district court, so it’s forfeited | Mohamed preserved the Subsection B argument, and it is properly before the court |
| Interpretation of “established by a government agency” | Maryland’s process “brought the account into existence” through its application and referral process | Only the entity actually opening the account (the bank) can establish the account | The ordinary meaning and regulatory context support that the state agency established the account |
| Broader regulatory and policy context | The historical and regulatory framework supports broad coverage for modern electronic government benefit accounts under EFTA | Regulatory context implies only direct agency-issued accounts would qualify, not those issued by contracted banks | Regulatory context and history confirm coverage extends to accounts administered by banks on behalf of state agencies |
Key Cases Cited
- Nadenla v. WakeMed, 24 F.4th 299 (4th Cir. 2022) (de novo review standard for dismissed claims)
- Volvo Constr. Equip. N. Am., Inc. v. CLM Equip. Co., 386 F.3d 581 (4th Cir. 2004) (issues not argued below usually not considered on appeal)
- In re Under Seal, 749 F.3d 276 (4th Cir. 2014) (preservation of issues for appeal)
- Maynard v. General Elec. Co., 486 F.2d 538 (4th Cir. 1973) (theory encompassed by pleadings can be considered on appeal)
- Southwest Airlines Co. v. Saxon, 596 U.S. 450 (2022) (ordinary meaning as interpretive standard)
- United States v. Menasche, 348 U.S. 528 (1955) (all statutory text to be given effect)