The type of class action that culminates in a check showing up in someone’s inbox is not really the focus of the Walmart TeleCheck case. It falls into a distinct category: a settlement that modifies the appearance of a single line of fine print at thousands of checkout terminals nationwide, pays the attorneys, and awards the plaintiff a little reward.
Depending on how you gauge these factors, that may or may not be a significant victory. Customers won’t receive a refund if they were slapped with many bank fees during bounced-check disputes. However, starting later this year, shoppers who write checks at Walmart will see a more obvious warning before giving the clerk the slip.
| Walmart TeleCheck Lawsuit Settlement — Key Information | Details |
|---|---|
| Case Name | Morris v. Walmart, Inc. |
| Lead Plaintiff | Brandy Morris |
| Defendant | Walmart Inc. |
| Settlement Amount | $1.85 million (mostly for legal fees) |
| Affected Locations | Roughly 4,600 U.S. stores |
| Check Processor | TeleCheck |
| Core Allegation | Inadequate point-of-sale and PIN pad disclosures |
| Underlying Harm | Multiple bounced-check and return-fee bank charges |
| Customer Payout | None |
| Required Settlement Action | Updated POS and PIN pad disclosures |
| Plaintiff Incentive Award | Reasonable amount allocated from $1.85M |
| Objection Deadline | April 23 |
| Fairness Hearing | July 27 at 1:30 p.m. |
| Reference Reporting | |
| Approval Status | Pending court decision |
Brandy Morris filed the case, claiming that Walmart’s check processing notices—posted signs and disclaimers on PIN pads at each Walmart point of sale—did not adequately describe what would happen in the event that a check rejected. She claimed that the omission was significant. TeleCheck, Walmart’s check processor, makes many attempts to retrieve a returned check.
The complaint claims that it can try multiple times to cash the underlying amount, and if those attempts are successful, it can try again to deduct return costs from the customer’s bank account. Every attempt to access an account with insufficient funds usually results in an additional bank fee. The losses have the potential to grow rapidly.
Morris said that because the disclosures failed to inform consumers about the multi-attempt collection procedure, she and other Walmart customers were charged many overdraft and insufficient funds fines. In that cycle, there is a specific type of consumer harm. A $40 shopping run might have been the initial transaction.
The actual cost might have increased multiple times by the time TeleCheck and the customer’s bank had completed cycling through retry efforts and fees. The lawsuit contended that the disclosure ought to have made that risk apparent at the time of payment.
As is nearly typically the case with defendants in these agreements, Walmart denies any wrongdoing. The retail behemoth accepted the disclosure modifications and the $1.85 million payment without acknowledging any wrongdoing. The majority of the funds are used for legal fees. Morris receives a part as compensation for filing the lawsuit.
The remaining impacted customers who paid with checks at Walmart and were trapped in the multi-attempt collection process receive no direct reimbursement. Additionally, they are unable to opt out because the settlement does not require them to give up any ability to pursue their own future claims.
Observing how these “no-money” agreements work gives the impression that the practical impact is more intriguing than the appearances. Tens of millions of customers will see slightly more truthful language about what happens when a check bounces thanks to the disclosure revisions that will be implemented at every Walmart in the nation.
The clarity of Walmart’s new statement and whether or not customers read it will determine whether or not it stops a significant number of compounded bank fees in the future. The date of the Fairness Hearing is July 27. Currently, the lawsuit is pending court approval.
