Cotchett, Pitre & McCarthy Announces Bank of America Must Face Trial in California Pandemic Unemployment Benefits Litigation

In re BANK OF AMERICA CALIFORNIA UNEMPLOYMENT BENEFITS LITIGATION, Case No.: 3:21-md-2992-GPC-MSB

SAN DIEGO--(BUSINESS WIRE)--Cotchett, Pitre & McCarthy announces today, August 18, 2026, that Judge Gonzalo P. Curiel of the U.S. District Court in San Diego issued a 105-page order denying Bank of America’s motion for summary judgment in this long-running Multi-District Litigation class action. The lawsuit seeks to hold the Bank accountable for violating state and federal laws for more than 100,000 Californians who received unemployment and disability benefits through Bank-issued prepaid debit cards during the COVID pandemic. The Court’s order clears the way for the case to go to trial, including on plaintiffs’ claims for treble (3x) damages for the Bank’s willful violations of federal statutes and punitive damages for its intentional disregard of class members’ rights.

Plaintiffs allege that during the pandemic, California benefits recipients had their unemployment benefits stolen from their prepaid debit card accounts due to the Bank’s failure to implement basic security measures, such as including industry-standard EMV security chips on the debit cards. Under the federal Electronic Funds Transfer Act, banks are required to investigate cardholders’ claims of unauthorized transactions on their accounts. Plaintiffs allege that instead of conducting the required investigations, the Bank used an automated Claim Fraud Filter to summarily deny all cardholder claims alleging unauthorized ATM transactions and froze the cardholders’ accounts, depriving them of access to previously paid benefits. The Bank then compounded the harm by making it nearly impossible for most aggrieved cardholders to reach its customer service centers, often forcing them to spend hours on hold before being disconnected.

The law firm of Cotchett, Pitre & McCarthy filed a class action lawsuit, Yick v. Bank of America, N.A., in January 2021. The district court in San Francisco then consolidated several cases, appointed Cotchett, Pitre & McCarthy and Altshuler Berzon LLP as interim co-lead counsel and issued a sweeping preliminary injunction in June 2021, finding that plaintiffs “demonstrated a strong likelihood of success on their claims” and that the Bank’s “continued denial of these benefits will seriously hinder the ability of many class members to feed their families and keep a roof over their heads.” That injunction required the Bank to stop using its Claim Fraud Filter to automatically deny claims or freeze accounts, to reopen and investigate claims previously denied based on the Claim Fraud Filter, to reimburse all cardholders whose claims the Bank improperly denied, and to take specific, court-ordered steps to improve its call center customer service.

The Yick consolidated cases and other similar cases pending against the Bank throughout California were then transferred into a multi-district litigation before the district court in San Diego, with Cotchett, Pitre & McCarthy LLP and Altshuler Berzon LLP appointed co-lead counsel.

On July 14, 2022, Bank of America entered into Consent Orders with the Consumer Financial Protection Bureau and Office of the Comptroller of the Currency which mirrored many of the claims in plaintiffs’ original complaints, and the Bank agreed to pay fines to the government totaling $225 million.

In June 2025, Judge Curiel certified five classes—called the Claim Denial, Credit Rescission, Account Freeze, Customer Service, and EMV Chip classes. The case will now move forward to trial with plaintiffs seeking class-wide damages, including statutory, treble, and punitive damages, for the Bank’s wrongful conduct, including for its:

• violations of the federal Electronic Funds Transfer Act by failing to timely investigate and reimburse unauthorized transaction claims;
• violations of the California Consumer Privacy Act by issuing EDD debit cards without EMV security chips and failing to ensure the confidentiality of plaintiffs’ personal information;
• violations of due process rights by depriving class members of a protected property interest without providing adequate due process;
• negligence in failing to include security chips on EDD debit cards and failing adequately to staff its customer service call center; and
• breaches of the implied covenant of good faith and fiduciary duties owed to EDD cardholders.

According to Brian Danitz, a partner at Cotchett, Pitre & McCarthy, co-lead counsel for the Class:

The District Court’s thorough 105-page decision is a major step toward achieving justice for Californians who were deprived of their only lifeline during the pandemic. As alleged, Bank of America failed to safeguard the accounts of EDD debit cardholders, failed to investigate fraud claims and then cut off access to critically needed UI benefits to protect its bottom line. This pandemic era case can finally go to trial and hold the Bank accountable for failing to live up to its obligations at a tremendous cost to so many vulnerable Californians.

Michael Rubin of Altshuler Berzon LLP, co-lead counsel for the Class, stated:

The Court’s summary judgment ruling picks apart the Bank’s defenses one by one and creates clear path forward for the more than 100,000 California class members seeking treble and punitive damages. Plaintiffs contend that the Bank’s purported claim fraud filter was never designed to detect actual fraud, but was instead callously created to boost the Bank’s bottom line at the expense of innocent unemployed Californians. We look forward to fully vindicating the class members’ rights at trial.

Connie Chan, also of Altshuler Berzon LLP, added:

Today’s ruling is a major milestone in this long-running litigation and clears the way for all of plaintiffs’ key claims to proceed to trial. Now that the Bank’s summary judgment motion has been denied, we look forward to presenting our case to a jury and finally obtaining justice for the tens of thousands of unemployed Californians who were harmed by the Bank’s unlawful and self-serving policies.

The lawsuit is In re Bank of America California Unemployment Litigation, Case No. 3:21-md-2992-GPC-MSB, in the U.S. District Court for the Southern District of California. Cotchett, Pitre & McCarthy LLP and Altshuler Berzon LLP are co-lead counsel for the Class. Casey Gerry Schenk Francavilla Blatt & Penfield LLP is Liaison Counsel for the Class.