Walters v. Target

A Court authorized this website because you have a right to know about the proposed Settlement of this class action lawsuit. This website explains the lawsuit, the Settlement, and your legal rights.

Judge M. James Lorenz of the United States District Court for the Southern District of California is overseeing this case. The case is known as Walters v. Target Corp., No. 3:16-cv-1678-L-MDD (the “Action”). The persons who sued are called the “Plaintiffs.” The Defendant is Target.

A separate lawsuit pending in the United States District Court for Minnesota, Dixon v. Target Corp., No. 0:18-cv-02660, will be dismissed with prejudice as part of the proposed Settlement.

The Action claims that the TDC (as defined in FAQ 3) is deceptively marketed. The Action further alleges that Target breached the TDC Agreement as well as the duty of good faith and fair dealing by the manner in which Target processes TDC Transactions and assesses RPFs (also defined in FAQ 3). The First Amended Complaint is posted here and contains all of the allegations and claims asserted against Target.

Target denied, and continues to deny, each and every claim and allegation of wrongdoing asserted in the Action, and Target believes it would ultimately be successful in its defense of all claims asserted in the Action.

“Linked Deposit Account” means the deposit account linked to a consumer’s TDC from which the TDC withdraws funds to pay TDC Transactions.

“TDC” means the Target Debit Card.

“TDC Agreement” means the TDC terms and conditions as may be amended from time to time that all consumers accept when they open a TDC account.

“TDC Transaction” means a transaction with Target, whether in a brick-and-mortar Target store or on Target’s website, where a customer uses their TDC to make a purchase.

“RPF” or, plural, “RPFs,” means the Returned Payment Fee that Target applies to a TDC when a TDC Transaction is returned unpaid by the customer’s financial institution holding the Linked Deposit Account, as described in the TDC Agreement.

In a class action, one or more people called class representatives (in this case, Plaintiffs James Walters, Michelle Dixon, Charles Powell, and Deana Polcare) sue on behalf of people who have similar claims. The people included in the class action are called the Settlement Class or Settlement Class Members. One court resolves the issues for all Settlement Class Members, except for those who timely exclude themselves from the Settlement Class.

The Court has not decided in favor of either the Plaintiffs or Target. Instead, both sides agreed to the Settlement. By agreeing to the Settlement, the Parties avoid the costs and uncertainty of a trial, and Settlement Class Members receive the benefits described in FAQ 7. The Class Representatives and Class Counsel believe the Settlement is best for everyone who is affected.

All TDC holders in the United States who, within the Class Period, incurred at least one RPF in connection with their TDC that was not refunded or waived.

Based on a review of Target’s data, it is estimated that the Settlement Class numbers approximately 954,805. You may contact the Settlement Administrator if you have any questions as to whether you are in the Settlement Class.

Under the Settlement, Target has agreed to provide both business practice changes and monetary relief (money) to Settlement Class Members.

Business Practice Changes

Beginning on or before the Effective Date, Target agrees not to implement or assess RPFs, or any equivalent fee, in connection with TDC Transactions of less than $7.00. Beginning on or before the Effective Date, Target agrees that any RPFs charged will be the lesser of the RPF as disclosed by the TDC Agreement or the amount of the TDC Transaction that was returned unpaid. Both changes will remain in effect for a period of 2 years after the Effective Date.

Plaintiffs and Target will work collaboratively to amend the TDC Agreement to provide additional information to TDC Holders regarding how they may incur RPFs from Target and non-sufficient funds or overdraft fees from their banks and/or credit unions in connection with the use of the TDC.

Monetary Relief

Target has agreed to pay a Cash Settlement Amount of $5,000,000 and to waive approximately $3,222,330 in RPFs currently due and owing by Settlement Class Members.

How will Settlement Class Member Cash Payments be calculated? Each Settlement Class Member who incurred a RPF during the Class Period and paid all or part of the first RPF incurred during the Class Period will be entitled to receive a cash payment from the Net Settlement Fund. The Net Settlement Fund means the $5,000,000 Cash Settlement Amount minus Class Representative Service Awards and Fee & Expense Award. Each Settlement Class Member Cash Payment shall be equal to the Settlement Class Member’s pro rata share of the Net Settlement fund based on the dollar amount of the first RPF paid by the Settlement Class Member.

How will Debt Reduction Payments be calculated? For Settlement Class Members who have not paid the first RPFs they incurred during the Class Period at the time the Settlement Class Member Cash Payments are to be distributed, the Debt Reduction Cash Amount will be used by Target to reduce such outstanding RPFs by twenty-five percent.

Under the Settlement, a Class Member may not qualify for relief from both the Cash Settlement Amount and Debt Reduction Cash Amount, even if they paid one or more RPFs during the Class Period that were not refunded and were assessed at least one other RPF during the Class Period that is still due and owing.

If you are in the Settlement Class and entitled to receive a Settlement Class Member Cash Payment or Debt Reduction Payment, you do not need to do anything to receive it. If the Court approves the Settlement and it becomes final and effective, you will automatically receive a payment by check or reduction of your debt.

Unless you excluded yourself from the Settlement Class by April 17, 2020, you cannot sue or be part of any other lawsuit against Target about the legal issues in this Action. It also means that all of the decisions by the Court bind you. The “Release” included in the Settlement Agreement describes the precise legal claims that you gave up if you remained in the Settlement. The Settlement Agreement is available here.

The deadline to exclude yourself from the Settlement passed on April 17, 2020.

No. Unless you excluded yourself, you give up the right to sue Target for the claims that the Settlement resolves.

No. You will not receive a payment or debt reduction if you excluded yourself from the Settlement.

The Court appointed a number of lawyers to represent you and others in the Settlement Class as “Class Counsel,” including the law firms Kopelowitz Ostrow Ferguson Weiselberg Gilbert, Kaliel PLLC, and Tycko & Zavareei LLP.

Class Counsel represented you and others in the Settlement Class. You will not be charged for these lawyers. If you want to be represented by your own lawyer, you may hire one at your own expense.

Class Counsel has been awarded $2,110,900.28 to reimburse Class Counsel for attorneys’ fees incurred in researching, preparing for, and litigating this Action, and for costs and expenses incurred in the Action. The fees and expenses awarded by the Court have been paid out of the Settlement Fund.

Based on their respective levels of participation in the Action, Plaintiff Walters was awarded a Class Representative Service Award of $7,500.00 in recognition of his service to the Settlement Class. Plaintiffs Dixon, Powell, and Polcare were awarded Class Representative Service Awards of $3,000.00 each in recognition of their service to the Settlement Class.

The deadline to object to the Settlement passed on April 17, 2020.

Objecting is telling the Court that you do not like something about the Settlement. You can object to the Settlement only if you do not exclude yourself from the Settlement. Excluding yourself from the Settlement is telling the Court that you don’t want to be part of the Settlement. If you exclude yourself from the Settlement, you have no basis to object to the Settlement because it no longer affects you.

The deadline to object to and exclude yourself from the Settlement passed on April 17, 2020.

The Court will hold a Final Approval Hearing at 10:30 a.m. on June 22, 2020, at the Edward J. Schwartz United States Courthouse, 221 West Broadway, San Diego, CA 92101, Courtroom 5B. The hearing may be moved to a different date or time without additional notice, so it is a good idea to check this website for updates. At this hearing, the Court will consider whether the Settlement is fair, reasonable, and adequate. The Court will also consider any request by Class Counsel for attorneys’ fees and expenses and for Service Awards for the Class Representatives. If there are objections, the Court will consider them at this time. After the hearing, the Court will decide whether to approve the Settlement. We do not know when the Court will make its decision. It is a good idea to check this website for updates.

Update: This hearing has been vacated per the Court’s Order.

Update: The Court issued a Final Approval Order on October 26, 2020.

No. Class Counsel will answer any questions the Court may have, but you may come at your own expense. If you send an objection, you do not have to come to Court to talk about it. As long as you submit your written objection on time, to the proper addresses and it complies with the requirements set forth previously, the Court will consider it. You may also pay your own lawyer to attend, but it is not necessary.

Update: This hearing has been vacated per the Court’s Order.

You may speak at the Final Approval Hearing if you have filed and served a timely objection to the Settlement according to the procedures set out in FAQ 15.

Update: This hearing has been vacated per the Court’s Order.

If you did nothing, you will still receive the benefits to which you are entitled under the Settlement Agreement. Unless you excluded yourself, you will not be able to start a lawsuit or be part of any other lawsuit against Target relating to the issues in this Action.

These answers to Frequently Asked Questions summarize the approved Settlement. More details can be found here. You may also write with questions to TDC Settlement, P.O. Box 2838, Portland, OR 97208-2838, or call the toll-free number 1-877-848-3932. Do not contact Target or the Court for information.