SECURITY PACIFIC NATIONAL BANK: CERTIFICATE OF DEPOSIT

Attorney West Seattle, P.S. is representing several people that are being denied redemption of their bank bonds, bank bills, and certificate of deposits. This may include certificates or bonds from SECURITY PACIFIC NATIONAL BANK.

If you have a bank bond, bank bill, or certificate of deposit from SECURITY PACIFIC NATIONAL BANK, call us today for a free consultation. Our phone number is 206 745 3738.

A copy of our draft complaint against Bank of America is below.

COMES NOW, the Plaintiff, by and through her attorney of record, Eric J. Harrison of Attorney West Seattle, P.S., and alleges on information and belief the following Complaint.

INTRODUCTION

In 1983, Plaintiff deposited money in exchange for a certificate of deposit (“CD”) issued by Old National Bank of Washington. A copy of Plaintiff Susan Holmes’ CD is attached as Exhibit A. Plaintiff’s initial annual interest rate on the CD is “9.020%” and provides for automatic renewal. Plaintiff held the original CD in a secure place for safekeeping. The terms on the CD require the registered owner to surrender the original CD to redeem their principal and unpaid interest. Defendant U.S. BankCorp is the successor institution to Old National Bank of Washington. Recently, Plaintiff went to U.S. BankCorp to surrender her CD and withdraw her money. U.S. BankCorp refused to return Plaintiff’s money. U.S. BankCorp has previously been sued for their failure to redeem certificates of deposits from similarly acquired local banks. In one case, Harris, et al. v. U.S. BankCorp, et al., Case No. 2:19-CV-00291, Federal District Court Judge Barbara J. Rothstein denied defendants’ motion to dismiss the breach of contract and violations of Washington Consumer Protection Act claims. Nevertheless, U.S. BankCorp continues to tell Plaintiff that her CD is worthless and that it has no value.

PARTIES

1.              Plaintiff Susan Holmes is a resident Benton County, Washington.

2.              Defendant U.S. BankCorp (“U.S. Bank”), is a national banking association with its main office in Minneapolis, Minnesota. U.S. Bank is regulated by the Office of the Comptroller of the Currency, an independent bureau of the United States Department of the Treasury. U.S. Bank is the parent company of U.S. Bank National Association. U.S. Bank National Association holds successor interest in Old National Bank of Washington, including Old National Bank of Washington’s assets and liabilities. All further references to “the bank” or to “Defendant”, refers to U.S. Bank, U.S. Bank National Association and their predecessors.

JURISDICTION & VENUE

3.              At all relevant times, Defendant U.S. Bank maintained offices and transacted business in Washington, including King County.

FACTUAL ALLEGATIONS

4.              On June 27, 1983, Plaintiff Susan Holmes deposited $20,000 in exchange for CD No. 743131 from Old National Bank of Washington. Old National Bank of Washington issued a Certificate of Deposit under Certificate No. 743131 (the “CD”) payable to Vesta W. or James K. or Sue Holmes (“registered owners”) for funds deposited with the bank in the principal amount of $20,000.00.

5.              Plaintiff is the registered owner to the CD listed in this Complaint.

6.              The CD is a multiple maturity non-negotiable time certificate of deposit.

7.              Plaintiff’s initial annual interest rate on the CD is “9.020” and the CD’s interest payments were to be paid monthly by deposit to an account.

8.              According to the terms printed on the face of the CD, it automatically renews with interest for subsequent maturities equal in length to the original maturity period unless the CD is cashed “upon the return of this certificate properly endorsed”.

9.              Old National Bank of Washington and its successors never gave notice to the registered owners of the CD, or the Plaintiff, that the CD was not being renewed. Plaintiff, nor any of the registered owners, cashed out the CD by returning the certificate properly endorsed.

10.           Plaintiff held the CD in a secure place for safekeeping.

11.           After the time of the first renewal, the registered owner did not receive any notice from any bank that the CD was not being renewed, was dormant, or that funds had escheated to the State of Washington.

12.           Old National Bank of Washington and its successors never escheated the deposited money from the CD to Washington State.

13.           The Federal Deposit Insurance Corporation (“FDIC”) states that Defendant is the successor to Old National Bank of Washington.

14.           In 1988, Old National Bank merged into and subsequently operated as part of U.S. Bank of Washington, National Association. In 1997, U.S. Bank of Washington, National Association merged into and subsequently operated as part of United States National Bank of Oregon. In 1997, United States National Bank of Oregon merged into and subsequently operated as part of U.S. Bank National Association.

15.           U.S. Bank is the parent company of U.S. Bank National Association. U.S. Bank National Association holds successor interest in Old National Bank of Washington, including Old National Bank of Washington’s assets and liabilities.

16.           Defendant received benefit from the CD issued by Old National Bank of Washington by earning interest on the deposit.

17.           Defendant knew, or should have known, about CDs issued by Old National Bank of Washington. U.S. BankCorp has previously been sued for their failure to redeem certificates of deposits from similarly acquired local banks. In one case, Harris, et al. v. U.S. BankCorp, et al., Case No. 2:19-CV-00291, Federal District Court Judge Barbara J. Rothstein denied defendants’ motion to dismiss the breach of contract and violations of Washington Consumer Protection Act claims. Nevertheless, U.S. BankCorp continues to tell Plaintiff that her CD is worthless and that it has no value.

18.           Defendant knew, or should have known, about the validity of Old National Bank of Washington CDs. Defendant failed to disclose the validity of Old National Bank of Washington CDs to the Plaintiff.

19.           After being made aware of their obligation on CDs issued by Old National Bank, Defendant continued a policy of misinforming Plaintiff and other holders that the CDs were worthless.

20.           Recently Plaintiff presented her original CD to surrender for redemption at Defendant’s branch location. Defendant refused to redeem the CD.

21.           Defendant told Plaintiff that the CD had no value. Defendant told the Plaintiff that the CD had either already been redeemed, or that the CD’s funds had escheated to the State of Washington. Defendant knew, or should have known, these statements were false. Prior to making these statements to the Plaintiff, Defendant failed to investigate and/or perform due diligence on Plaintiff’s CD.

22.           Plaintiff spent time investigating Defendant’s false claims. Plaintiff spent time contacting the Washington State Department of Revenue which confirmed that it had no record of having received any funds belonging to the registered owners of the CD.

23.           The terms for withdrawing the CD funds are stated on the face of the CD. The terms state that the principal amount and any accrued interest will be paid to the owner “upon return of this certificate, properly endorsed, plus interest at an annual rate of 09.020 percent. This certificate will be automatically renewed for successive periods equal to the original term at the Bank’s then interest rate for certificates the same principal and term of this bond unless you cash the bond within 10 days after its maturity date.”

24.           Defendant holds the money deposited by Plaintiff by way of merger and purchase of Old National Bank of Washington.

25.           As successor in interest to Old National Bank of Washington, Defendant earned interest on the money deposited by Plaintiff.

26.           As successor in interest to Old National Bank, Defendant benefited from money deposited by Plaintiff.

27.           Plaintiff attempted to redeem her original CD according to the instructions printed on the face of the CD and Defendant refused to return the money and refused to pay the interest owed to the Plaintiff as required by the terms of the CD.

28.           Defendant adopted an unfair policy universally refusing Washington residents’ CDs issued by Old National Bank.

29.           Defendant adopted a deceptive policy to tell Washington residents that their CDs had no value and were worthless.

30.           Other Washington residents have similarly been denied redemption of their Old National Bank of Washington CD.

31.           Defendant’s refusal to pay registered owners upon their surrender of the original CDs affects other registered owners, transferees, beneficiaries, and heirs in Washington state.

FIRST CAUSE OF ACTION – Breach of Contract

32.           Plaintiff re-alleges and incorporates by reference each allegation set forth herein.

33.           Old National Bank of Washington entered into valid written contract with the registered owner. As part of that written contract, Old National Bank of Washington accepted cash deposits from the registered owner in exchange for a CD issued to the registered owner.

34.           U.S. Bank acquired the liability on the CD listed in this Complaint through bank mergers. U.S. Bank is the successor to  Old National Bank of Washington.

35.           Defendant, as successor to Old National Bank of Washington, breached the contract with Plaintiff by declining to redeem and pay the balance of the CD, plus interest. Defendant and their predecessor have not provided any notices to the registered owners, transferees or their beneficiaries that the CD would not be renewed, that it was dormant or that the CD’s funds were being escheated to the State.

36.           In breaching the contract with Plaintiff, Defendant also breached the contractual covenants of good faith and fair dealing that it owed Plaintiff as a party to the contract.

37.           Defendant is liable to Plaintiff for the principal amounts of the CD as well as all interest accrued on the CD.

38.           Defendant’s breach of the contract caused Plaintiff to suffer foreseeable damages. From the outset of the contract, it was foreseeable that breaches would cause direct and consequential damages to Plaintiff, including, but not limited to, loss of principals, loss of interests, attorneys’ fees, and related costs of litigation, all in amounts to be proven at trial.

SECOND CAUSE OF ACTION – VIOLATION OF CONSUMER PROTECTION ACT

39.           Plaintiff re-alleges and incorporates by reference each allegation set forth herein.

40.           The actions, practices, and omissions of Defendant constitute unfair and deceptive acts and practices in the conduct of trade and commerce that affect the public interest within the meaning of the Washington Consumer Protection Act, RCW 19.86.

41.           The CD states on its face that the funds shall be withdrawn “upon return of this certificate, properly endorsed.” No other terms are stated as an alternative procedure for withdrawing the CD’s funds.

42.           Plaintiff has fully complied with all the steps necessary to redeem the CD. Defendant has refused to redeem the CD by making up erroneous theories in the absence of any evidence that one of its predecessors may have followed unwritten and unpublished rules unknown to Plaintiff by redeeming the CD without requiring the return and endorsement of the original CD.

43.           Defendant’s adoption of a policy to refuse redemption by Washington State CD holders without investigation into their individual CDs is an unfair business practice.

44.           Defendant’s conduct of telling Plaintiff that their CD has no value is an unfair business practice.

45.           Defendant’s position that they do not have to fulfill the terms of the CD’s contract with Plaintiff solely because the bank speculates without any evidence, that they may have followed procedures contrary to the terms printed on the face of the CD’s certificate is an unfair business practice.

46.           Defendant has refused to pay other substantially similar CD holders in Washington State. Defendant has no evidence to support their non-payment position. Their refusal to redeem the CDs based upon an unpublicized change in the rules from those printed on the face of the CDs is an unfair business practice. The CDs were purposely structured to renew automatically, with no termination date so that consumers would leave their money on deposit with the bank indefinitely.

47.           When a consumer has kept their CD funds at the bank for an extended period, just as the terms of the CD encouraged, but is denied redemption because the bank has not retained the records for that account, the burden for the costs of enforcing the contract should fall on the bank. It would have been a simple and inexpensive matter for the bank to have retained the records for CD accounts for which the original CD certificates were not returned properly endorsed. For its own reasons Defendant, or its predecessors, chose not to retain those records, or any other records regarding the registered owner’s account. The bank cannot use the bank’s own business decision not to retain records as the basis for denying a valid consumer claim supported by the customers’ records that the bank pledged to rely upon. To do so is an unfair business practice.

48.           Defendant’s responses to Plaintiff’s attempt to redeem her CD are per se misrepresentations. The CD certificate states the rules and process for redemption. When Plaintiff, and other persons similar to them in Washington State, complied with those rules, Defendant refused to pay and informed the Plaintiff that her CD had no value. This type of unfair business practice toward consumers is exactly what the Washington Consumer Protection Act was designed to protect against.

49.           As a direct and proximate result of Defendant’s violations of the Consumer Protection Act, Plaintiff has suffered damages, including but not limited to loss of principal and interest, loss of time spent investigating Defendant’s false claims, attorneys’ fees, and related costs of litigation, all in amounts to be proven at trial.

50.           These actions by Defendant have affected the public interest. Old National Bank of Washington issued numerous similar CDs to numerous other people that Defendant is refusing to redeem when presented with the original CD.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff prays that this Court grant the following relief:

1.     Judgment against U.S. Bank awarding Plaintiff damages in an amount to be proven at trial, including the face value of the CD, plus accrued interest according to the terms of the CD;

2.     That Plaintiff be awarded damages under the Consumer Protection Act, RCW 19.86, including treble damages, and costs and attorneys’ fees;

3.     That Plaintiff be awarded prejudgment interest from the date that redemption was denied through the date of judgment; and

4.     For such other relief as the Court deems just and equitable.

RESPECTFULLY SUBMITTED.

Attorney West Seattle, P.S.  

Eric J. Harrison, WSBA# 46129

Attorney for Plaintiffs