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|1.||WHAT IS THIS LAWSUIT ABOUT?|
The lawsuit that is being settled is entitled Joy L. Bowens v. Mazuma Federal Credit Union, United States District Court, Western District of Missouri, Case No. 4:15-cv-00758. The case is a “class action.” That means that the “Named Plaintiff,” Joy L. Bowens is an individual who is acting on behalf of all persons who were charged an overdraft fee at any time from April 1, 2011 through September 30, 2015, and, at the time such fee was imposed, that person had sufficient funds in the current balance but not the available balance in his or her account to complete the transaction. This group is called the “Class Members.” She is asserting claims for breach of contract, violations of Regulation E and other causes of action. She seeks a refund of such allegedly improper overdraft fees charged to Class Member accounts. Mazuma does not deny it charged overdraft fees but alleges that it did so properly and in accordance with the terms of its account agreements and applicable law because Mazuma assesses overdrafts based on the available balance in a member’s account. Mazuma maintains that this practice was disclosed to its members and therefore denies that its practices give rise to claims for damages by Ms. Bowens or any class member.
|2.||WHY DID I RECEIVE NOTICE OF THIS LAWSUIT?|
You received a Notice because Mazuma’s records indicate that you were charged overdraft fee(s) between April 1, 2011 and September 30, 2015, while your available balance was insufficient but your current balance was sufficient to complete the transaction at issue. The Court directed that the Notice be sent to all Class Members because each Class Member has a right to know about the proposed settlement and the options available to him or her before the Court decides whether to approve the settlement.
|3.||WHY DID THE PARTIES SETTLE?|
In any lawsuit, there are risks and potential benefits that come with a trial versus settling at an earlier stage. It is the Named Plaintiff’s lawyers’ job to identify when a proposed settlement offer is good enough that it justifies recommending settling the case instead of continuing to trial. In a class action, these lawyers, known as Class Counsel, make this recommendation to the Named Plaintiff. The Named Plaintiff has the duty to act in the best interests of the class as a whole, and in this case, it is her belief, as well as Class Counsel’s opinion, that this settlement is in the best interest of all Class Members for at least the following reasons:
There is legal uncertainty about whether a judge or a jury will find that Mazuma was contractually and otherwise legally obligated not to assess overdraft fees when the current balance was sufficient to pay for a transaction, and even if they were, there is uncertainty about whether the claims are subject to other defenses that might result in no or less recovery to Class Members. Even if the Named Plaintiff were to win at trial, there is no assurance that the Class Members would be awarded more than the current settlement amount and it may take years of litigation before any payments would be made. By settling, the Class Members will avoid these and other risks and the delays associated with continued litigation.
|4.||HOW DO I KNOW IF I AM PART OF THE SETTLEMENT?|
If you received a notice, then Mazuma’s records indicate that you are a Class Member who is entitled to receive a payment or credit to your account.
|5.||WHAT OPTIONS DO I HAVE WITH RESPECT TO THE SETTLEMENT?|
You have three options: (1) do nothing and await a disbursal of the remaining settlement funds; (2) exclude yourself from the settlement (“opt out” of it); or (3) participate in the settlement but object to it. Each of these options is described in a separate section below.
|6.||WHAT ARE THE CRITICAL DEADLINES?|
The deadline for sending a letter to exclude yourself from or opt out of the settlement is July 11, 2018.
The deadline to file an objection with the Court is July 31, 2018.
|7.||HOW DO I DECIDE WHICH OPTION TO CHOOSE?|
If you do not like the settlement and you believe that you could receive more money by pursuing your claims on your own (with or without an attorney that you could hire) and you are comfortable with the risk that you might lose your case or get less than you would in this settlement, then you may want to consider opting out.
If you believe the settlement is unreasonable, unfair, or inadequate and the Court should reject the settlement, you can object to the settlement terms. The Court will decide if your objection is valid. If the Court agrees, then the settlement will not be approved and no payments will be made to you or any other Class Member. If your objection (and any other objection) is overruled, and the settlement is approved, then you will still get a payment.
|8.||WHAT HAS TO HAPPEN FOR THE SETTLEMENT TO BE APPROVED?|
The Court has to decide that the settlement is fair, reasonable, and adequate before it will approve it. The Court already has decided to provide preliminary approval of the settlement, which is why you received a Notice. The Court will make a final decision regarding the settlement at a “Fairness Hearing” or “Final Approval Hearing”, which is currently scheduled for October 23, 2018.
|9.||HOW MUCH IS THE SETTLEMENT?|
Mazuma has agreed to create a Settlement Fund of $1,360,000, and also has agreed to change its practices in assessing overdraft fees to use the "collected balance" in the account rather than the "available balance". The parties agree that this operational change would have decreased the total amount of overdraft fees charged by Mazuma over the last four years by approximately $3 million. As discussed separately below, Attorneys’ fees, litigation costs, a Service Award to the Named Plaintiff, and the costs paid to a third party Claims Administrator to administer the settlement (including mailing the notice) will be paid out of this amount. The balance of the Settlement Fund will be divided among all Class Members based on the amount of eligible overdraft fees they paid.
|10.||HOW MUCH OF THE SETTLEMENT FUND WILL BE USED TO PAY FOR ATTORNEY FEES AND COSTS?|
Class Counsel has requested that the Court award 33-1/3% (one-third) of the settlement fund as attorneys’ fees, which is equal to about 11% if savings from the change to collected balance is included, and comes out to $453,333.33. Class Counsel has also requested that it be reimbursed approximately $35,000 in litigation costs incurred in prosecuting the case. The Court makes the decision on the request for attorneys’ fees and costs, and will decide the amount of the attorneys’ fees based on a number of factors, including the risk associated with bringing the case on a contingency basis, the amount of time spent on the case, the amount of costs incurred to prosecute the case, the quality of the work, and the outcome of the case.
|11.||HOW MUCH OF THE SETTLEMENT FUND WILL BE USED TO PAY THE NAMED PLAINTIFF A SERVICE AWARD?|
Defendant has agreed not to oppose a service award to the Named Plaintiff of up to $10,000. The Named Plaintiff intends to apply to the Court for a service award of not less than five percent of the settlement fund, which comes to approximately $68,000, for her role in securing this settlement on behalf of the class. The Court will decide if a Service Award is appropriate and if so, the amount of the award.
|12.||HOW MUCH OF THE SETTLEMENT FUND WILL BE USED TO PAY THE CLASS ADMINISTRATOR’S EXPENSES?|
The Claims Administrator has agreed to cap its expenses at $41,250.00.
|13.||HOW MUCH WILL MY PAYMENT BE?|
After payment of attorneys’ fees and costs of litigation, the Service Award payment to the Named Plaintiff and the costs of the Claims Administrator, it is estimated there will be approximately between $762,416.67 and $830,416.67 left in remaining funds which will be disbursed to class members on a pro rata basis, based on how many challenged overdraft fees they were charged. This means approximately between $5.92 and $6.45 for each of the qualifying overdraft transactions.
|14.||DO I HAVE TO DO ANYTHING IF I WANT TO PARTICIPATE IN THE SETTLEMENT?|
No. As long as you do not opt out, you may participate in the disbursement of settlement funds. A credit will be applied to your checking account if you are an existing member, or a check will be mailed to you at the last known address Mazuma has for you if you are not an existing credit union member. If your address has changed, you should provide your current address to the Claims Administrator at the address set forth in Question 16, below.
|15.||WHEN WILL I RECEIVE MY PAYMENT?|
The Court will hold a Fairness Hearing (explained below in Questions 22-24) on October 23, 2018 to consider whether the settlement should be approved. If the Court approves the settlement, then the claims administrator may begin to process payments. However, if someone objects to the settlement, and the objection is sustained, then there is no settlement. Even if all objections are overruled and the Court approves the settlement, an objector could appeal and it might take months or even years to have the appeal resolved, which would delay any payment.
|16.||HOW DO I EXCLUDE MYSELF FROM THE SETTLEMENT?|
If you do not want to receive a payment, or if you want to keep any right you may have to sue Mazuma for the claims alleged in this lawsuit, then you must exclude yourself or “opt out.”
To opt out, you must send a letter to the Claims Administrator that you want to be excluded. Your letter can simply say “I hereby elect to be excluded from the settlement in the Bowens v. Mazuma Federal Credit Union class action.” Be sure to include your name, last four digits of your member number, address, telephone number, and email address. Your exclusion or opt out request must be postmarked by July 11, 2018, and sent to:
Bowens v. Mazuma Credit Union Claims Administrator c/o GCG P.O. Box 10546 Dublin, OH 43017-7246
|17.||WHAT HAPPENS IF I OPT OUT OF THE SETTLEMENT?|
If you opt out of the settlement, you will preserve and not give up any of your rights to sue Mazuma for the claims alleged in this case. However, you will not be entitled to receive a payment from this settlement.
|18.||IF I EXCLUDE MYSELF, CAN I OBTAIN A PAYMENT?|
No. If you exclude yourself, you will not be entitled to a payment.
|19.||HOW DO I NOTIFY THE COURT THAT I DO NOT LIKE THE SETTLEMENT?|
You can object to the settlement or any part of it that you do not like IF you do not exclude yourself or opt out from the settlement. (Class Members who exclude themselves from the settlement have no right to object to how other Class Members are treated.) To object, you must send a written document to the Court and the Claims Administrator at the address below. Your objection should say that you are a Class Member, that you object to the settlement, and the factual and legal reasons why you object. In your objection, you must include your name, address, telephone number, email address (if applicable), your signature, and whether you intend to appear at the hearing.
You should use the following form when you send your objection to the Court and the Claims Administrator:
Your Address (not a post office box)
Your Telephone Number
Your e-mail address
UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF MISSOURI
Mazuma Federal Credit Union
Case No. 4:15-cv-00758
Objection to Class Settlement by
Hearing Date: October 31, 2018
Time: 10:00 a.m.
[Reason For Your Objection]
All objections must be post-marked no later than July 31, 2018, and must be mailed as follows:
United States District Court for the Western District of Missouri Charles Evans Whittaker Courthouse 400 E. 9th Street Kansas City, MO 64106
Bowens v. Mazuma Credit Union Claims Administrator c/o GCG P.O. Box 10546 Dublin, OH 43017-7246
|20.||WHAT IS THE DIFFERENCE BETWEEN OBJECTING AND REQUESTING EXCLUSION FROM THE SETTLEMENT?|
Objecting is telling the Court that you do not believe the settlement is fair, reasonable, and adequate for the class, and asking the Court to reject it. You can object only if you do not opt out of the settlement. If you are in the settlement and do not opt out, then you are entitled to a payment if the settlement is approved, but you will release claims you might have against Mazuma. Excluding yourself or opting out is telling the Court that you do not want to be part of the settlement, and do not want to receive a payment or release claims you might have against Mazuma for the claims alleged in this lawsuit.
|21.||WHAT HAPPENS IF I OBJECT TO THE SETTLEMENT?|
If the Court sustains your objection, or the objection of any other Class Member, then there is no settlement. If you object, but the Court overrules your objection and any other objection(s), then you will be part of the settlement.
|22.||WHEN AND WHERE WILL THE COURT DECIDE WHETHER TO APPROVE THE SETTLEMENT?|
The Court will hold a Final Approval or Fairness Hearing at 10:00 am on October 23, 2018 at the United States District Court for the Western District of Missouri, located at Charles Evans Whittaker Courthouse, 400 East 9th Street, Kansas City, Missouri 64106. At this hearing, the Court will consider whether the settlement is fair, reasonable and adequate. If there are objections, the Court will consider them. The Court may also decide how much to award Class Counsel for attorneys’ fees and expenses and how much the Named Plaintiff should get as a “Service Award” for acting as the class representative.
|23.||DO I HAVE TO COME TO THE HEARING?|
No. Class Counsel will answer any questions the Court may have. You may attend if you desire to do so. If you have submitted an objection, then you may want to attend.
|24.||MAY I SPEAK AT THE HEARING?|
If you have objected, you may ask the Court for permission to speak at the Final Approval Hearing. To do so, you must include with your objection, described in Question 19, above, the statement, “I hereby give notice that I intend to appear at the Final Approval Hearing.”
|25.||WHAT HAPPENS IF I DO NOTHING AT ALL?|
If you do nothing at all, and if the settlement is approved, then you may receive a payment that represents your share of the Settlement Fund net of attorneys' fees, Claims Administrator expenses, the Named Plaintiff's Service Award, and all other costs that have been paid. You will be considered a part of the class, and you will give up claims against Mazuma for the conduct alleged in this lawsuit. You will not give up any other claims you might have against Mazuma that are not part of this lawsuit.
|26.||DO I HAVE A LAWYER IN THIS CASE?|
|27.||DO I HAVE TO PAY THE LAWYER FOR ACCOMPLISHING THIS RESULT?|
No. Class Counsel will be paid directly from the Settlement Fund.
|28.||WHO DETERMINES WHAT THE ATTORNEY’S FEES WILL BE?|
The Court will be asked to approve the amount of attorneys’ fees at the Fairness Hearing. Class Counsel will file an application for fees and costs and will specify the amount being sought as discussed above. You may review the fee application here or view a physical copy at the Office of the Clerk of the United States District Court for the Western District of Missouri, which is located at Charles Evans Whittaker Courthouse, 400 East 9th Street, Kansas City, Missouri, 64106.