Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-05923/USCOURTS-cand-3_07-cv-05923-52/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1331 Fed. Question

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

VERONICA GUTIERREZ, ERIN WALKER,

and WILLIAM SMITH, as individuals and on

behalf of all others similarly situated,

Plaintiffs,

 v.

WELLS FARGO & COMPANY, WELLS

FARGO BANK, N.A., and DOES 1 through 125,

Defendants. /

No. C 07-05923 WHA

ORDER RE TX 588

At issue is whether a Federal Register announcement by a group of federal bank-related

agencies (Trial Exhibit 588) should be allowed in evidence under Rule 803(8). The crux of the

proffer is this paragraph in an otherwise thick document: 

The Agencies are not addressing transaction processing order at

this time. The Agencies believe that it would be difficult to set

forth a bright-line rule that would clearly result in the best outcome

for all or most consumers. For example, requiring institutions to

pay smaller dollar items first may cause an institution to return

unpaid a large dollar nondiscretionary item, such as a mortgage

payment, if there is an insufficient amount of overdraft coverage

remaining to cover the large dollar item after the smaller items

have been paid. 

74 Fed. Reg. at 5548 (col. 1). 

Contrary to defendant, this passage — from 2009 — said nothing about the actual

rationale of defendant years before when it adopted high-to-low processing in or before 2001. 

Case 3:07-cv-05923-WHA Document 444 Filed 05/10/10 Page 1 of 2
United States District Court

For the Northern District of California

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There was no, moreover, “investigation” within the meaning of Rule 803(8)(C). 

The sources for the paragraph appear simply to have been “industry commenters” as referenced

five times in the paragraphs immediately preceding in question. Nor did the paragraph make any

“finding.” It merely explained why the Agencies did “not address[] transaction processing order

at this time.” 

Even if the second and third sentences were treated as a finding, those statements were

substantially qualified. That it may be “difficult to set forth a bright-line rule that would clearly

result in the best outcome for all or most consumers” does not mean it cannot be done or cannot

be done on a record such as has been compiled in our trial. And, the phrases “clearly” and “all or

most” inject qualifiers that undermine the supposed force of the statement. Similarly, phrases like

“may cause” and “if there is” inject considerable speculation. “May cause” implies “may not

cause.” The “if” clause conditions the entire statement. 

Nothing in the paragraph purports to say what consumers would actually prefer. That an

institution “may” return a rent check if the overdraft coverage or tolerance were exhausted

does not mean that consumers would prefer imposition of a larger number of overdraft fees.

The consumer comments in the prior paragraph were plainly opposed to the practice even if in

theory a rent check might be returned. 

All of these qualifications having been said, the section of Trial Exhibit 588 that contained

the paragraph in question will be allowed into evidence. At a minimum, it has some relevance to

issues of the scope of potential relief herein. The Court will take into account the limitations on

the proffered evidence in deciding how much weight to give it. 

IT IS SO ORDERED.

Dated: May 10, 2010. WILLIAM ALSUP

UNITED STATES DISTRICT JUDGE

Case 3:07-cv-05923-WHA Document 444 Filed 05/10/10 Page 2 of 2