A federal court approved the $550,000 settlement of a class action brought by former inmates of certain Ohio correctional facilities who claimed they were issued unsolicited, fee-bearing debit cards to hold the money they’d surrendered.
Stored Value Cards Inc. and Republic Bank & Trust Co. respectively managed and sponsored a program under which some Ohio law enforcement facilities would put cash held by incoming inmates into a trust account. The inmates would then be given prepaid debit cards with the balance of their funds when they were released.
These cards charged fees for monthly maintenance, ATM usage, and balance inquiries. Cardholders could request a paper check for their account balance at no charge, but only if the request was made within five days after the card was issued.
Amber Humphrey brought a class action against the companies, alleging the program violated the Electronic Funds Transfer Act and Ohio law.
The U.S. District Court for the Northern District of Ohio approved a settlement agreement Tuesday.
Settlement administrator American Legal Claims Services will receive about $224,000 in costs, and class counsel Laribee & Hertrick LLP and O’Toole McLaughlin Dooley & Pecora LPA will receive a similar amount in attorneys’ fees and litigation expenses.
Humphrey sought a $15,000 incentive award as class representative, but the court determined that a $10,000 award was more reasonable.
The remainder will be split among approximately 1,770 class members who have filed claims, or about $52 per member, “which likely exceeds the fees they incurred from Defendants’ prepaid debit card program,” the court said.
The settlement is fair, reasonable, and adequate, Judge James S. Gwin said.
Fox Rothschild LLP and Thompson Hine LLP represent Stored Value. Katten Muchin Rosenman LLP and Thompson Hine represent Republic.
The case is Humphrey v. Stored Value Cards, N.D. Ohio, No. 1:18-cv-01050, 1/12/21.