Navy Federal Credit Union $5.5M Settlement for Debit Card Fees

Navy Federal Credit Union has agreed to pay $5,500,000 to settle a class action lawsuit for alleged breaches of agreements regarding debit card fees. The lawsuit claims that Navy Federal improperly assessed International Service Assessment Fees ("ISA Fees") on foreign purchases made by accountholders while they were physically located in the United States from August 9, 2016, to March 24, 2023.

Who Benefits?

All current and past Navy Federal Accountholders who were assessed at least one ISA Fee during the Class Period (from August 9, 2016, to March 24, 2023) for purchases made while they were physically located in the United States.

How much can I get?

Settlement Class Members who submit a Valid Claim will be eligible to receive a $4.00 Base Settlement Class Member Payment. Additional Settlement Class Member Payments will be calculated based on the remaining funds in the Net Settlement Fund and the Actual ISA Fees incurred.

Important Dates

• Deadline to File a Claim: August 8, 2024
• Deadline to Opt Out of the Settlement: June 24, 2024
• Deadline to Object to the Settlement: June 24, 2024
• Final Approval Hearing: July 24, 2024

Can I Claim an Award?

If you received a Notice, then Navy Federal’s records indicate that you are a member of the Settlement Class and are entitled to submit a Claim Form to receive a cash Settlement Class Member Payment. The Settlement Class includes all current and past Navy Federal Accountholders who were assessed at least one ISA Fee during the Class Period (August 9, 2016, to March 24, 2023) for debit card purchases made while they were physically located in the United States.

The Class Representatives, Siobhan Morrow, Tracee Le Flore, and Maria Hart, are acting on behalf of all current and past Navy Federal Accountholders who were assessed at least one ISA Fee during the Class Period. The Class Representatives have asserted a claim for breach of contract and breach of the implied covenant of good faith and fair dealing. Navy Federal contends that the fees Plaintiffs are complaining about were assessed properly and in accordance with the terms of the Debit Card Disclosure.

What Can I Claim?

The balance of the Settlement Fund after the payment of the Service Award, attorneys’ fees and costs, and Settlement Administration Costs, also known as the Net Settlement Fund, will be used to pay Settlement Class Members who submit a Valid Claim.

All Settlement Class Members who submit a Valid Claim will be eligible to receive a $4.00 Base Settlement Class Member Payment. If there are not enough funds in the Net Settlement Fund to pay $4.00 to each Settlement Class Member who submits a Valid Claim, each Base Settlement Class Member Payment will be reduced pro rata. If there remain funds in the Net Settlement Fund after calculating the total amount of Base Settlement Class Member Payments, the remainder of the Net Settlement Fund will be payable to the Settlement Class Members who submitted Valid Claims and had more than $4.00 in Actual ISA Fee(s) during the Class Period as an Additional Settlement Class Member Payment.

• Base Settlement Class Member Payment: $4.00
• Additional Settlement Class Member Payment: Calculated based on remaining funds in the Net Settlement Fund and Actual ISA Fees incurred.

Why Fees on Foreign Purchases?

The lawsuit alleges that Navy Federal Credit Union breached its agreements regarding debit card fees by assessing International Service Assessment Fees ("ISA Fees") on foreign purchases Accountholders made while located in the United States from August 9, 2016, to March 24, 2023.

Is Proof Required to Claim the Reward?

Yes, proof is required to claim the reward. Settlement Class Members must submit a Valid Claim to receive a cash Settlement Class Member Payment. The proof required includes the Unique ID assigned to you on the electronic Claim Form.

How to Claim Your Award

If you are a Settlement Class Member, you must fill out and submit a Claim Form to receive a Settlement Class Member Payment. You can submit your electronic Claim Form at . If you received a notice of this Settlement via email, there is a link on that email to access the Claim Form. You will need to enter the Unique ID assigned to you on the electronic Claim Form.

You can also receive a paper Claim Form from the Settlement Website or get one by calling the Settlement Administrator at 1-877-581-8129. The completed Claim Form must be submitted online by August 8, 2024, or mailed to the following address, postmarked by August 8, 2024:

Morrow v. Navy Federal Settlement Administrator  

P.O. Box 2329  

Portland, OR 97208-2329

$5,500,000 Settlement Fund

Defendant has agreed to create a Settlement Fund of $5,500,000.00. As discussed separately below, any court-awarded Service Awards, Attorneys’ Fees and Costs Payment, and Settlement Administration Costs will be paid out of the Settlement Fund.

Class Counsel will request the Court to approve payment from the Settlement Fund for attorneys’ fees and costs in the amount of $2,000,000.00. The Court will decide the amount of the attorneys’ fees and costs after application by Class Counsel which will be made at the same time as the filing of the Motion for Final Approval of the Settlement.

Why is There a Class Action Settlement?

The lawsuits being settled are entitled Morrow et al., v. Navy Federal Credit Union and Hart v. Navy Federal Credit Union. The Consolidated Action is pending in the United States District Court for the Eastern District of Virginia, Case Nos. 1:21-cv-722 and 1:22-cv-844.

In any lawsuit, there are risks and potential benefits that come with a trial versus settling at an earlier stage. It is the Class Representatives’ and their lawyers’ job to identify when a proposed settlement offer is good enough that it justifies recommending settling the case instead of continuing to trial. In a class action, the Class Representatives’ lawyers, known as Class Counsel, make this recommendation to the Class Representatives. The Class Representatives have a duty to act in the best interests of the Settlement Class as a whole, and, in this case, it is their belief, as well as Class Counsels’ opinion, that this Settlement is in the best interest of all Settlement Class members.

There is legal uncertainty about whether a judge or a jury will find that Navy Federal was contractually and otherwise legally obligated to not assess the fees at issue. There is also uncertainty about whether the Class Representatives’ claims are subject to other defenses that might result in no or less recovery to Settlement Class members. Even if the Class Representatives were to win at trial, there is no assurance that the Settlement Class members would be awarded more than the current Settlement amount, and it may take years of litigation before any payments would be made. By settling, the Settlement Class members will avoid these and other risks and the delays associated with continued litigation.

While Navy Federal disputes the allegations in the lawsuit and denies any liability or wrongdoing, it enters into the Settlement solely to avoid the expense, inconvenience, and distraction of further proceedings in the litigation.