Compliance Blog

More Credit Union ADA Litigation Wins

Two more ADA lawsuits against credit unions have been thrown out of court.  On April 5, a federal judge in Virginia granted a credit union's motion to dismiss an Americans with Disabilities Act (ADA) website accessibility suit after finding that the plaintiff lacked standing to sue.  See, Carroll v. Washington Gas Light Federal Credit Union, 1:17-cv-1201 (E.D. Va. April 4, 2018).  And on April 16, in an additional victory for credit unions, another U.S. District Judge granted a separate motion to dismiss on similar grounds.  See, Carroll v. Northwest Federal Credit Union, 1:17-cv-01205 (E.D. Va. April 16, 2018).  NAFCU filed "friend of the court" amicus briefs in support of both credit unions.

NAFCU recognizes the importance of the ADA and fully supports efforts to ensure individuals with disabilities have equal access to financial services.  However, meritless and costly lawsuits are not the answer.  Credit unions in at least 25 states have been impacted by a growing litigation threat over unclear website requirements under the ADA.  The Department of Justice's implementing regulations are vague on website accessibility standards and this regulatory ambiguity has spurred a surge of website accessibility claims targeting credit unions and other entities.  NAFCU is standing with credit unions in the fight against unnecessary ADA lawsuits. We have filed seven amicus briefs to defend NAFCU member credit unions so far; of those, five cases have been dismissed.  The recent court decisions join a growing list of early wins for the credit union industry.  See e.g., Carroll v. Northwest Federal Credit Union, l:17-cv- 01205 (E.D. Va. Jan 26, 2018); Griffin v. Department of Labor Federal Credit Union, 1:17-CV-1419 (E.D. Va. Feb. 21, 2018); Thurston v. United Energy Credit Union,  3:17-cv-3393-D (N.D. Tx. Mar. 1, 2018) (voluntarily dismissed); Carroll v. ABNB Federal Credit Union, 2:17-cv-521 (E.D. Va. Mar. 5, 2018).

Carroll v. Washington Gas Light Federal Credit Union

Acknowledging NAFCU's amicus brief in its order, the court in Washington Gas Light noted that "membership in every federal credit union is limited to a specific group of individuals," and "an individual must be within the membership field to join the credit union and to take advantage of its products and services."  See, Carroll v. Washington Gas Light Federal Credit Union, 1:17-cv-1201 at 6.

Finding that the plaintiff failed to allege membership or membership eligibility in the credit union, the court dismissed the complaint, stating:

Plaintiff has pleaded no facts to suggest that he is, or ever has been, or ever intends to be, an employee of Washington Gas Light Company or any qualifying entity.  He thus fails to plead that he is eligible to be a member of WGLFCU, or that he could ever take advantage of any of the services offered by [the credit union].  Plaintiff alleges that he has been hindered in his search "for information that enables a person without an account to learn what services WGLFCU has to offer potential customers including descriptions of its amenities and services." But Plaintiff is not, and cannot be, a "potential customer."


Id. at 7 (internal citations omitted). Because the plaintiff had no "actual or potential membership" in the credit union, the court concluded that the plaintiff had no standing to bring suit.  Id.

Carroll v. Northwest Federal Credit Union

The latest dismissal order in Northwest Federal Credit Union is the court's second determination in favor of the credit union. The case had already been dismissed once in January when the court ruled that the plaintiff in the case, who is not a member or clearly eligible for membership, lacked standing to sue. See, Carroll v. Northwest Federal Credit Union, l:17-cv- 01205 (E.D. Va. Jan 26, 2018). On April 16, the court again granted the credit union's motion to dismiss after determining that the plaintiff's amended complaint did not cure the standing defects of the original complaint.

In his amended complaint, the plaintiff  argued that he was eligible for membership in the credit union because he intended to volunteer in the future for a community partner of the credit union, and employees and volunteers of that group are within the credit union's field of membership.

The court rejected that argument, stating:

Plaintiff still lacks standing to bring this claim before the Court.  In his Amended Complaint, Plaintiff alleges that he intends to volunteer for [the community partner] at least once in 2018 and therefore is now an eligible member of Northwest FCU.  While it is true that as a community partner of the credit union, [partner] employees and volunteers are within the membership field, as the facts are alleged, Plaintiff still remains ineligible.

There is no indication in the Amended Complaint that Plaintiff has ever volunteered with [the community partner]. Plaintiff's mere intention to volunteer "at least once" at some point in the future does not make him eligible for membership with Northwest FCU now – much less when the alleged injury took place.


Id. at 2. Thus, the court found the plaintiff still lacked standing and dismissed the second complaint.  In addition, the court reiterated that it "stands by its previous decision that a website is not a place of public accommodation under Title III of the ADA."  Id. at 3.

More to Come

While credit unions facing ADA suits are seeing favorable initial outcomes, litigation risk in this area will likely continue.  According to this month's results of NAFCU's Economic & CU Monitor survey (the April newsletter is coming soon), nearly half of all respondents have received a demand letter asserting a website violation of the ADA. When asked about the timing of those demand letters, responses indicate that the pace of activity in this area is increasing.

Please visit NAFCU's ADA webpage to learn more about this issue, and to keep apprised about what NAFCU is doing to fight for credit unions.

About the Author

Pamela Yu, Special Counsel for Compliance and Research, NAFCU

 Pamela Yu, Special Counsel for Compliance and ResearchPamela Yu was named special counsel for compliance and research in September 2016. In this role, Yu works with NAFCU's compliance and research departments to help credit unions with a variety of compliance and operational issues.

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