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A California federal judge has granted final approval to a $6.55 million class action lawsuit settlement resolving claims that Intuit’s free TurboTax edition included exorbitantly high interest rates.
Arkansas residents Tasha and Fredierick Smith filed the TurboTax class action lawsuit in February of last year, claiming that Intuit violates the Truth in Lending Act (TILA) and California business and usury laws. They alleged that the “free” online edition of TurboTax charges illegal and outrageously high fees to consumers who choose to defer their TurboTax fees, opting instead to have the fees deducted from their tax refund.
In their class action lawsuit, the Smiths claim that the TurboTax webpage presents users with a variety of TurboTax products, including the so-called “Free Edition.” However, this edition of the software is not free because it charges $19.95 to file a state tax return. They allege that the “Free Edition” of TurboTax costs nothing unless a user wants to “file, e-file, or print your return,” in which case the user must purchase TurboTax federal and state products.
The plaintiffs claim that they had used TurboTax in 2009, 2010 and 2011. Each time, they deferred the $86.90 fee to use the software, opting to have the amount deducted from their tax refund. Allegedly, Intuit charged them $29.95 to have the fee deducted from their refund, more than 34 percent of the original usage fee. The Smiths claimed that Intuit failed to adequately disclose the fee for the “refund processing service” as a finance charge.
Initially, the plaintiffs argued that the $29.95 should be considered a refund anticipation loan and therefore should be subject to interest rate and finance charge disclosure rules. However, U.S. District Judge Edward J. Davila disagreed and dismissed this claim because TurboTax users never received any money from Intuit. Subsequently, the parties agreed to settle the class action lawsuit. Intuit has denied any wrongdoing but agreed to refund consumers under the terms of the class action settlement.
Earlier this year, Judge Davila granted preliminary approval to the Intuit TurboTax class action settlement. After a fairness hearing was held on September 27, Judge Davila granted final approval to the class action settlement on October 1. Class Members include anyone who used Intuit’s TurboTax online and utilized the “refund processing service” from January 12, 2008 until May 28, 2013. The agreement will incorporate a second class action lawsuit that is currently pending against Intuit in state court.
To be eligible to receive a cash award from the class action settlement, Class Members must submit a valid Claim Form to the Settlement Administrator on or before October 28, 2013.
Detailed instructions on how to file a claim for the TurboTax class action settlement can be found here in our Open Class Action Lawsuits section.
Attorneys for the plaintiffs include Hank Bates of Carney Williams Bates Pulliam & Bowman PLLC; Gillian Wade and Isaac Miller of Milstein Adelman LLP; Richard M. Golomb, Ruben Honik and Kenneth J. Grunfeld of Golomb & Honik PC; and Brian T. Ku and M. Ryan Casey of Ku & Mussman PA.
The TurboTax Class Action Lawsuit Settlement case is Smith v. Intuit Inc., Case No. 12-cv-00222, in the U.S. District Court for the Northern District of California.
UPDATE 1: Some Top Class Actions viewers have reported they received the following update from Heffler Claims Group, the Settlement Administrator for the TurboTax class action settlement: “We are currently in the process of reviewing over 360,000 filed claims. Your patience during this process is appreciated. Checks will be mailed out upon completion of the claims review process.The amount that each claim will receive via the settlement fund has not yet been determined. This determination usually occurs once all claims have been finalized. At this time, we have no set date for fund disbursement, but we are anticipating checks to go out soon after the claims review process is completed. Please feel free to get back to us in the future.” More info: www.turbotaxclassaction.com
UPDATE 2: Payments from the TurboTax class action settlement were mailed the second week of November. Learn more: https://topclassactions.com/lawsuit-settlements/lawsuit-news/43855-turbotax-heel-homeopathic-class-action-settlements-pay/
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122 thoughts onJudge Approves TurboTax Class Action Lawsuit Settlement
I was wondering the same thing when should we expect payment. Ive used turbo tax since 2008 . I submitted my claim in i think aug ir sept
Does anyone know when & if we will be receiving a payment? Thank you
F God sakes don’t post your personal information here. Particularly your SS#!
Have my claim been process yet my EDITOR’S NOTE – SOCIAL SECURITY NUMBER REMOVED. DO NOT POST YOUR CLAIM NUMBER OR SOCIAL SECURITY NUMBER ON TOPCLASSACTIONS.COM . ONLY THE SETTLEMENT ADMINISTRATOR CAN HELP YOU WITH YOUR CLAIM! EVERYTHING YOU POST AS A COMMENT IS PUBLIC.
How much money am I getting and when am I getting it?
I’ve been using this since 2006 and I am also interested in learning what the outcome was. I filed to be a part of it. Did we win or lose? And what are the consequences for Turbo Tax? Will it be cheaper in the long run, will they revamp their process? I enjoy using it, but I’d be happy to see it restructured and CHEAPER.
I have used turbotax over the past several yrs, so when do we get out money in the mail? lol
ok it says the judge disagreed and dismissed the claim. then it says judge approves turbotax class action lawsuit settlement. so did we win or lose?
MY HUSBAND DID 3YRS OF OUR TAXES THEN I DID ONE ON MY OWN THINKING I WOULD BE ABLE TO ATLEAST ENOUGH TO PUT FOR DOWN PYMT. HAHA! AND COME TO FIND OUT I COULD OF ALL ALONG !!!!!!!
HELLO, I’M JUST SUBMITTING MY NAME & CLAIM # 396YRBJ