Chase Bank USA, N.A

 This is a class action on behalf of all Chase Bank USA, N.A. (“Chase” or “Defendant”) credit card customers who were improperly subjected to increases of the annual percentage rates of interest (“APR”) included in the terms of their Chase Card Member Agreements (“CMA”).

Chase’s CMAs include a “Finance Charges” section which disclose that Chase may charge “Preferred” and “Non-Preferred” APRs. The Preferred APR may be a fixed rate, which does not fluctuate, or it may be a variable rate that changes based upon a specific mathematical formula tied to a variable index. Chase also discloses that any fixed or variable Preferred APR may change to a much higher “default” or “Non-Preferred” rate upon the occurrence of certain specified events, such as: (a) late or missed payment to Chase or any other creditor; (b) charges in excess of a credit limit; or (3) a returned payment. Finally, Chase generally reserves the right to make “special rate” offers for cash advances, balance transfers and other types of transactions.

Chase does not clearly and conspicuously disclose any other manner or circumstance that could potentially lead to a change in the Preferred APR. Nor does it clearly and conspicuously disclose any other APR that it may charge.

Unbeknownst to Plaintiffs and the proposed class, Chase employs a practice, sometimes referred to as “Adverse Action Repricing” (“AAR”), pursuant to which it unilaterally raises its cardmember’s Preferred APRs based on a wide variety of factors, events and/or circumstances that are not disclosed in its CMAs.

Chase’s failure to clearly and conspicuously disclose the APRs that it may apply as a result of its AAR practice or for any other reason (other than default or special rate offers) is in violation of TILA, and its practice of changing its cardmember’s APRs in ways that are not disclosed or agreed to in the CMAs is in breach of contract, including the implied covenant of good faith and fair dealing. As a result of Chase’s conduct, unwary consumers have been charged and paid finance charges in excess of the rates disclosed and promised in Chase’s CMAs, thereby incurring in damages.

Click here to view a copy of the complaint. Complaint.