Credit Union ADA Lawsuits: How We Got Here and What’s Next

Insights
Written By Brett Friedman, CFP®

Many credit unions are receiving demand letters, threatening lawsuits on behalf of plaintiffs’ who they claim are harmed by credit union websites that are not ADA compliant. Beware that some of the alleged plaintiffs are not credit union members, making the demand letters invalid.

ADA History

A disturbing development in the credit union industry is the lawsuits, demand letters, and settlements over credit union websites not being compliant with the Americans with Disabilities Act (ADA).  The ADA was signed into law in 1990 and amended in 2008 “to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities” and to “provide clear, strong, consistent enforceable standards” addressing such discrimination. The law sets standards for certain public accommodations and service establishments, which includes credit unions. Under the ADA credit unions are prohibited from excluding, denying services, or treating members with disabilities differently due to a lack of “auxiliary aids and services” which include tools such as closed-captions, interpreters, and Braille-enabled equipment.

DOJ and Initial Litigation

As written, the ADA does not specifically address website accessibility, however, the Department of Justice (DOJ) has indicated the law is broad enough to apply to websites. This assumption has been supported by multiple courts that have treated websites and other electronic media as under the purview of the ADA. In 2011 the DOJ entered into a settlement agreement with Wells Fargo indicating that discrimination includes the failure “to provide a website that is accessible to individuals with disabilities, including blind individuals who use screen readers to access web content that is visual” or to provide captions for deaf individuals. Wells Fargo paid $16 million to compensate individuals who experienced discrimination in violation of Title III of the ADA when trying to call Wells Fargo, access Wells Fargo's services, or visit one of Wells Fargo's retail stores. The bank also committed to making its website more accessible as part of the settlement, however, DOJ did not require specific standards to be followed. In 2014 the DOJ went a bit further in a consent decree with H&R Block by requiring the national tax preparer to update its website to conform to the Website Content Accessibility Guidelines (WCAG) 2.0 Level AA success criteria. The company also paid a total of $90,000 in restitution and civil penalties. Of interest, in this case, is that DOJ also required H&R Block to update its mobile app for conformity.

Description of WCAG 2.0

WCAG 2.0 was developed by the World Wide Web Consortium (W3C) and is used by most website operators as the de facto standard. It contains “success criteria” categorized into three levels: Level A (provides the most basic accessibility features); Level AA (addresses most common barriers) and Level AAA (highest level of web accessibility). The objective of WCAG 2.0 is to make web content accessible to a wider range of people with disabilities, including blindness and low vision, deafness and hearing loss, learning disabilities, cognitive limitations, limited movement, speech disabilities or photo-sensitivity. While the DOJ has not adopted WCAG 2.0, it is the accessibility standard for federal agency websites.

Credit Union ADA Lawsuits, Settlements, and Demand Letters

Credit unions across the country are being threatened with litigation from a handful of plaintiffs' law firms seeking to profit from the ambiguities in requirements for website accessibility under the ADA. The complaints allege that credit unions’ websites violate the ADA, specifically the portions of the law which prohibit discrimination on the basis of a disability for equal enjoyment of goods, services, facilities, privileges, advantages, or accommodations in places of public accommodation.  The suits seek injunctive relief as well as damages, interest, and attorney’s fees. Numerous credit unions have opted to settle out of court, with most settlements ranging between $5,000-$10,000. The decision to settle is based on a cost-benefit analysis when considering legal and court costs which can exceed $30,000 as well as reputation risk. The pace of litigation began to heat up in October 2017 when nine D.C. area credit unions were hit with class action lawsuits claiming their websites are inaccessible to the visually impaired. The plaintiffs claimed the credit unions failed to embed code that allows screen readers to vocalize descriptions of graphics on their websites. Therefore, these visually impaired users could not determine web content, fully browse the site, search for branch locations or learn about amenities.  Additional complaints included non-readable text, redundant links, and pages with empty or missing form labels. Cases have been thrown out of court because judges have decided the plaintiffs either did not suffer sufficient harm OR are not eligible for membership and therefore lack legal standing. Below are a few highlights of the ongoing ADA litigation:

  • Since September 2017, over 100 credit unions in 22 states & D.C. were hit with lawsuits

  • As of March 2018, CUNA was actively defending over 30 cases across nine states

  • CUNA, NAFCU, and Credit Union Leagues nationwide have filed amicus briefs

  • On June 12, the 6th ADA case in Virginia was dismissed

Recent Development

On August 6, 2018, a Georgia District Court threw out most, but not all, of a credit union ADA case. This court determined that while the plaintiff was unable to show a threat of future injury, due to their disability the individual received differential treatment because they were unable to browse for locations, services, and membership eligibility. The difference in the outcome of this case is subtle but could have a considerable impact on the outcome of future litigation. The Georgia court action contradicts the assertion that membership eligibility is required to prove injury and supports the assertion that a non-compliant website can prevent affected individuals from searching for a field of membership information. It is possible that the next phase of litigation may include a visually impaired plaintiff who does meet a credit union’s eligibility requirements.

What Credit Unions Can Do Now

  • Make risk-based decisions with regard to website accessibility

  • Stay informed on all recent developments

  • Confirm with their service provider, "webmaster", that their website is compliant with all applicable ADA requirements and that the site will function properly with assisted technologies, devices often used by handicapped individuals when accessing the internet.

  • Consult with counsel on jurisdictional trends

  • Consider adopting accessibility measures based on the potential risk – which, in addition to litigation risk, can include reputation risk.

If your Credit Union Receives a Demand Letter

  • Consult with counsel especially since the letters often provide a short timeframe for a response

  • Determine if the plaintiff is a member of the credit union or even eligible to be a member. If not, the demand letter will be invalid.

  • Notify insurers

  • Consider having the credit union's website assessed for possible accessibility issues

  • Upgrade the website to meet certain private industry accessibility standards

  • Place website accessibility statements on the credit union's website, indicating the credit union's commitment to accessibility and offer a toll-free number that consumers can call in the interim for assistance

Note that some credit unions have opted to temporarily take down their website until the demand letter is appropriately resolved.DeLeon and Stang will continue to update our credit union clients on the latest ADA developments and provide valuable guidance and resources. We do website compliance audits for those that need their websites evaluated. Contact a credit union team member today by calling (301) 948-9825.

Additional Resources

 

Brett Friedman, CFP®
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