InfoBytes Blog
Bank granted motion to dismiss in credit card sign-up bonus class action
On April 15, the U.S. District Court for the Northern District of California entered an order granting a defendant bank’s motion to dismiss a plaintiff’s claims relating to alleged false advertising in connection with a credit card, with leave to amend. Plaintiff alleged that after responding to a social media advertisement for a credit card in December 2022, promising a $200 cash sign-up bonus for spending $500 within the first three billing cycles, he applied for and was approved for the card. However, the terms of the agreement he entered into with defendant did not mention the sign-up bonus, and he never received it. Consequently, plaintiff sued for "Breach of Contract Including Breach of the Covenant of Good Faith and Fair Dealing," asserting that defendant’s actions are part of a broader marketing strategy to entice customers to apply for defendant’s credit cards. Defendant filed a motion to dismiss the case based on two arguments: (i) plaintiff lacks the necessary Article III standing; and (ii) plaintiff failed to state a claim upon which relief can be granted.
The court sided with the defendant on both arguments determining that (i) the plaintiff failed to establish the “traceability” element of standing because it is not clear when the advertisement was seen or what it specifically promised; and (ii) the contract did not include a promise for a sign-up bonus, such that no breach of contract had occurred.
The court provided plaintiff with leave to amend within 45 days from entry of the order.