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Howe v. Bank of America N.A.

November 16, 2009

WILLIAM HOWE ET AL., PLAINTIFFS AND APPELLANTS,
v.
BANK OF AMERICA N.A. ET AL., DEFENDANTS AND RESPONDENTS.



Appeal from a judgment of the Superior Court of Orange County, Ronald L. Bauer, Judge. Affirmed. (Super. Ct. No. 30-2008-00180012).

The opinion of the court was delivered by: Bedsworth, Acting P. J.

Filed 11/16/09; pub. order 12/8/09 (see end of opn.)

OPINION

Plaintiffs and appellants William Howe, Richard Boss and Bashir Ghazialam, acting on behalf of a putative class of "individuals of U.S. national origin and/or ancestry, as well as naturalized individuals," sued Bank of America, Mexicana Airlines and Visa International Service Association (collectively Bank of America). Their complaint was that these entities had discriminated against the class in violation of the Unruh Civil Rights Act (Civ. Code, § 51 et seq.) by requiring that United States citizens provide a Social Security number to open a particular type of credit card account, while allowing foreign nationals to open such accounts with only alternative forms of identification.

Bank of America demurred to the complaint, arguing it was required by federal law to obtain Social Security numbers from United States citizens seeking to establish credit card accounts; that federal law did not require banks to obtain Social Security numbers from foreign nationals; and that requiring such numbers from foreign nationals would effectively preclude those who were not eligible to obtain Social Security numbers from opening accounts. Given those circumstances, the policy of allowing foreign nationals, but not United States citizens, to obtain accounts without providing a Social Security number was a reasonable one. The trial court agreed with Bank of America and sustained the demurrer without leave to amend.

On appeal, plaintiffs reiterate the arguments advanced below, but we find them no more persuasive than did the trial court, and affirm the judgment.

FACTS

The complaint alleges the gist of the action as follows: "[t]o increase their profits, Defendants have employed a credit card promotion that discriminates against individuals of U.S. national origin and/or ancestry in favor of foreign nationals. Defendants require customers of U.S. national origin and/or ancestry to produce Social Security numbers when applying for a credit card or opening a Bank of America bank account, but Defendants have not been requiring the same of foreign nationals, thereby discriminating against those of U.S. national origin and/or ancestry, as well as arbitrarily discriminating against these same disfavored individuals."*fn1 (Italics added.) The credit card program at issue allegedly allows credit card applicants who are not United States citizens to open an account with identification other than a Social Security number, including a "passport, nonresident alien Border Crossing Card, nonimmigrant Visa and Border Crossing Card, or a Mexican Matricula Card," as an alternative to the Social Security number required from U.S. citizens. Moreover, such foreign applicants are given the opportunity "to deposit a minimum of $300 into a security collateral account to establish their credit line without a Social Security number. On the other hand, the... Credit Card Promotion does not offer U.S. nationals the security collateral account feature.... This security collateral account feature helps foreign nationals establish credit without a Social Security number, but it is not marketed towards U.S. nationals."

The complaint points out that even those foreign nationals who "are in the U.S. on a student or work visa and therefore are lawfully entitled to obtain a Social Security number, are not required to provide a Social Security number. On the other hand, a naturalized U.S. citizen whose country of national origin is a foreign country, must provide a Social Security number...." It further alleges that "Defendants' Credit Card Promotion favors illegal immigrants over naturalized U.S. citizens even though the naturalized U.S. citizens obeyed the law and are in the U.S. legally."

The complaint alleges this promotion harms the plaintiff class in two ways. First, "by not requiring Social Security numbers of foreign nationals, [the promotion] may be jeopardizing the safety of every person in the U.S. because the lack of a Social Security number aids terrorists, provides a gateway to money laundering, encourages illegal immigration and identity theft, and defies or hinders U.S. laws - including immigration laws, the Patriot Act, and tax laws." And second, the promotion improperly favors foreign nationals over the plaintiff class, because "[b]y not having to provide Social Security numbers, foreign nationals are not as vulnerable to identity theft, do not have a damaging inquiry added to their credit report, and no not have to report to the Internal Revenue Service interest from these accounts, as U.S. nationals must." In other words, the complaint suggests it is both harmful to allow foreign nationals to open accounts without Social Security numbers, and harmful to require U.S. citizens and permanent residents to provide Social Security numbers.

Finally, the complaint alleges this promotion violates "several California anti-discrimination laws," but specifically identifies only the Unruh Civil Rights Act, as embodied in Civil Code sections 51 and 51.5. It alleges that the promotion is an example of both "arbitrary discrimination" and "discrimination based on national origin and/or ancestry."

The complaint seeks both monetary damages and an injunction prohibiting further "discriminatory practices." However, plaintiffs do not specify whether the requested injunction should (1) preclude the Bank from allowing foreign nationals to apply for credit cards without providing a Social Security number, or (2) preclude Bank of America from requiring U.S. citizens and permanent residents to provide Social Security numbers in applying for such cards.

Bank of America demurred to the complaint, arguing that it is required by federal law to obtain Social Security numbers from U.S. citizens who apply for credit cards, but is allowed to rely on alternative forms of identification for applicants who are foreign nationals. It noted that in light of the federal requirement, it could not relax the Social Security number requirement for U.S. citizens; and since not all foreign nationals qualified for Social Security numbers, the imposition of such a requirement on that group would preclude many of them from eligibility and likely be perceived as discriminatory. Under those circumstances, the decision to allow foreign nationals to apply for credit cards without a Social Security number was reasonable and non-discriminatory. The Bank also argued that (1) plaintiffs had not alleged any cognizable harm to the putative class caused by either its requirement that they produce Social Security numbers to open a credit account, or its failure to require that foreign nationals provide Social Security numbers to open a credit account; and (2) to the extent a cause of action had been stated, the court should decline to consider it under the doctrine of equitable abstention, since adjudicating the credit practices of a federally regulated bank would delve too deeply into issues of economic policy, which is traditionally a legislative function.

Plaintiffs opposed the demurrer, arguing that Bank of America's credit card promotion was "designed to attract foreign nationals, who are in the United States legally and illegally, by not requiring foreign nationals to provide Social Security numbers when applying for a bank account and credit card." According to plaintiffs, this program was discriminatory because it denied them an opportunity to obtain an account on the same terms. Moreover, plaintiffs asserted that Bank of America's contention its policy merely reflected federally imposed identification requirements was based upon "extrinsic evidence," and thus was not cognizable in the context of a demurrer. But even if the court did consider Bank of America's federal law justification, plaintiffs argued that law established only minimum identification requirements for each group, and nothing therein precluded Bank of America from nonetheless "requir[ing] the same thing of everybody." Plaintiffs reasoned that in order to be in compliance "with the spirit of [The Patriot Act]," Bank of America should be asking ...


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