Blatt v. Capital One
Defendant’s MSJ granted – Capital One allegedly made recurring charges to plaintiff’s bank account without his written consent, and without providing him a copy of the written authorization to bill his account.
Discovery revealed that plaintiff provided his checking account information over the phone to make a vehicle payment through Capital One. On the same call, plaintiff was enrolled in a monthly automatic payment program (Direct Pay). To enroll in Direct Pay, plaintiff was transferred to an IVR where he entered his loan account number & SSN (last 4), and was played a detailed message describing the Direct Pay terms, after which he pressed ‘1’ to confirm his enrollment. Plaintiff subsequently received two mails via post: one confirming his initial payment, and one confirming his enrollment in Direct Pay.
The court found Capital One’s process through an ‘electronic agent’ (the IVR system) constituted a valid ‘electronic signature’ (digital file created through use of voice). Additionally, a copy of the authorization was provided in writing (via post). That the copy took two days to arrive did not mean the authorization was not provided ‘when made.’ In fact, other areas of Reg E required notice of certain activities within two to five business days.
The court further ruled that any inconsistencies between the recorded message and the mailed confirmation were immaterial. The critical information: payment amount, payment schedule, date agreed, date of first withdrawal, and how to cancel/change, were consistent across both oral and written disclosures.
Since EFTA/Reg E allows for electronic consents consistent with the eSign Act, and Capital One’s process met eSign requirements, plaintiff consented to the recurring charges.
[M.D. Tenn.; 2:15-CV-0015]
jbho: a great example of how an eSign consent can be obtained orally. A comprehensive script, confirmed by an follow up notification.
Lesson learned – make sure the script and written confirmation are synchronized.
I wonder if an email would have been just as good as the postal mail? It certainly could be considered more ‘contemporaneous’ and provided closer to ‘when made.’ Still, good to know the multiple channels can be leveraged in the eSign consent process.
