Capital One Class Action Says Credit Card Interest Fees Misrepresented

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A class action lawsuit claims Capital One misrepresents its credit card interest fees.

Plaintiff Susan Dress says Capital One intentionally obscures its credit card interest fees to maximize the interest it can charge consumers.

According to Dress, the company’s terms for their credit cards are confusing – though they lead consumers to believe that if they pay off a balance in full before the billing due date, they will not be charged interest.

However, in reality, if a consumer fails to pay off their balance in full one month, they will be charged interest on all future transactions until the balance is paid in full, according to the Capital One class action lawsuit.

Describing Capital One’s policy, Dress states that if a customer fails to pay their entire balance by the statement due date, “then Capital One takes away the interest-free grace period on all future transactions, causing interest charges to accrue the moment a customer makes a purchase. This is true regardless of whether the consumer pays [their] upcoming credit card bill in full.”

Allegedly, this practice is dissimilar to the practices of other major credit card companies, who do not typically charge consumers interest on purchases paid in full by the billing date.

Dress claims that the company intentionally makes their policies confusing and counterintuitive to consumers. Allegedly, no reasonable consumer would expect this to be the case, and a reasonable consumer would be confused by this policy. The plaintiff claims that nowhere in its marketing or terms and conditions does Capital One disclose this policy to consumers.

The Capital One interest fees class action lawsuit states that this practice, as well as Capital One’s failure to disclose it, represents a breach of contract, and is an unfair and deceptive business practice. As a result of these alleged misdeeds, Dress seeks damages on behalf of herself and all similarly affected consumers. Additionally, she seeks restitution that would force Capital One to cease this allegedly deceptive and illegal business practice.

To support her claim that Capital One intentionally misleads consumers into believing the terms of their credit cards are different than they really are, Dress cites the marketing language used by Capital One versus the marketing language used by its competitors.

She notes that Capital One’s Credit Card Agreement specifically states “we will not charge you interest on any new transactions…if you paid the total balance across all Segments of your Account in full by the due date on your Statement each month.” Allegedly, this promise is reiterated in multiple pieces of communication given to consumers.

The Capital One credit card class action lawsuit goes on to claim that Citibank does have a similar interest policy to Capital One’s policy, but discloses it in clear language. Dress uses this example to argue that Capital One could have used clearer language to communicate its policy.

The plaintiff then states that Capital One does have, and has used its capacity to communicate in clearer language, citing a conversation with a Capital One customer service representative who allegedly explained the policy in a language that was much clearer, and radically different from Capital One’s written communications.

Dress is represented by Patrick J. Sheehan of Whatley Kallas LLP; Nicholas A. Migliaccio and Jason S. Rathod of Migliaccio & Rathod LLP; Jeffrey Kaliel and Sophia Gold of Kaliel PLLC; and Kristi C. Kelly, Andrew J. Guzzo and Casey S. Nash of Kelly & Crandall PLC.

The Capital One Credit Card Interest Rates Class Action Lawsuit is Susan Dress v. Capital One Bank (USA) NA, Case No. 4:18-cv-40064-TSH, in the U.S. District Court for the District of Massachusetts.