Mehrbach v. Citibank, N.A.

Citation: 316 F. Supp. 3d 264Docket: Civil Action No.: 17–2739 (RC)

Court: Court of Appeals for the D.C. Circuit; July 11, 2018; Federal Appellate Court

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Tara Mehrbach filed a lawsuit against Citibank, N.A. for complying with a subpoena for her financial records during a lengthy custody dispute with her ex-husband. She alleges that Citibank violated Florida's privacy laws, specifically Fla. Stat. 655.059, and breached its confidentiality duty by not resisting the subpoena. Citibank moved to dismiss the case, arguing that Fla. Stat. 655.059 does not create a private right of action and that Florida law does not require banks to challenge valid subpoenas. The court granted Citibank's motion to dismiss, concluding that Ms. Mehrbach's claims lacked merit. The factual background details Ms. Mehrbach's ongoing custody battle, the subpoenas served by her former husband, her objections to the release of her financial records, and the differing responses of Citibank and Bank of America to the subpoenas. Ultimately, the court determined that Citibank had no obligation to contest the subpoena, leading to the dismissal of Ms. Mehrbach's complaint.

Under the Federal Rules of Civil Procedure, a complaint must present a "short and plain statement" demonstrating entitlement to relief. A motion to dismiss under Rule 12(b)(6) assesses whether a claim is properly stated, not the plaintiff's likelihood of success. Federal courts assume the truth of factual allegations in the complaint and construe them favorably toward the plaintiff. To survive such a motion, the complaint must contain sufficient factual matter to state a plausible claim for relief, moving beyond mere speculation. Legal conclusions disguised as factual allegations are not presumed true.

Pro se complaints are held to a less stringent standard, but they must still comply with the Federal Rules. The court is not obligated to search the record for supporting documents for a pro se party's claims. In her complaint, Ms. Mehrbach alleges that Citibank violated Florida law by complying with a subpoena for her financial records and negligently disclosed her information. Citibank argues that no private cause of action exists under the cited statute and that it had no legal obligation to challenge the subpoena. Consequently, the court grants Citibank's motion to dismiss Ms. Mehrbach's complaint.

Fla. Stat. 655.059 does not create a private cause of action, which is central to Ms. Mehrbach's claim against Citibank for the alleged improper release of her bank records. Citibank argues for dismissal based on this lack of a private cause of action, asserting that Ms. Mehrbach has not stated a viable claim for relief. The court confirms that the statute explicitly maintains the confidentiality of financial institution records and allows disclosure only under specific circumstances, such as a court order or subpoena. In evaluating whether a statute implies a private right of action, courts consider the text and legislative intent. They are generally hesitant to infer such rights when the statute does not expressly provide for them, particularly when aimed at public welfare rather than private liability. The court notes that the language of Fla. Stat. 655.059 does not support a private cause of action and finds no legislative intent to allow one. Ms. Mehrbach's reliance on a newer provision of the statute, which was not applicable at the time of the alleged disclosure and does not establish a civil remedy, further weakens her position. Enforcement appears to be designated primarily to state regulatory agencies, not private individuals, as indicated by other related statutes.

In Braham v. Branch Banking, Tr. Co., the Florida court ruled that the provisions of Fla. Stat. 655.85, which govern state financial institutions and empower the Office of Financial Regulation, are intended solely for public safety and welfare, not creating a private cause of action. Similarly, Fla. Stat. 655.059, which outlines conduct regarding confidential customer information, lacks an express private cause of action, leading the court to determine that no private cause of action can be judicially implied. Therefore, Ms. Mehrbach's claim under 655.059 is dismissed.

Regarding Ms. Mehrbach's negligence claim against Citibank, the court noted that Fla. Stat. 655.059 permits disclosure of financial information under subpoena, meaning Citibank had no duty to resist compliance. For a negligence claim in Florida, a plaintiff must demonstrate the existence of a duty, breach of that duty, a causal connection to the injury, and actual damages. The court concluded that Citibank did not owe Ms. Mehrbach a duty to challenge the subpoena. While banks have a general duty of confidentiality, this duty is limited when disclosure is legally compelled. Florida case law supports that banks may disclose confidential information under specific legal compulsion, public duty, bank interest, or customer consent. Previous cases, such as Milohnich and Barnett Bank, further clarify these exceptions and conditions under which banks may disclose confidential information.

Florida Statute 655.059 allows for the disclosure of confidential financial information in compliance with judicial processes. Courts, including Laterza v. JPMorgan Chase Bank, have ruled that financial institutions are not liable for disclosing records when compelled by a court, as required by Florida law. In the case of Ms. Mehrbach, she alleges Citibank negligently disclosed her financial information in response to a subpoena. However, case law supports that banks, like Citibank, are obligated to disclose information unless a compelling reason for nondisclosure is provided, such as a protective order. Ms. Mehrbach's reference to Winfield v. Division of Pari-Mutuel Wagering is deemed inapplicable as that case involved government entity disclosures, which differ from her situation. The Winfield court established that Florida's constitutional protections do not prevent the subpoena of bank records. The differing views of customer service between Citibank and Bank of America do not imply negligence on Citibank's part. Consequently, the court granted Citibank's Motion to Dismiss, noting that Ms. Mehrbach failed to state a viable claim. Despite being an attorney, her filings were treated with leniency due to her pro se status. The court, applying Florida law to her statutory claim, found procedural and administrative deficiencies in her arguments.

District of Columbia choice-of-law rules favor applying Florida law, particularly in negligence cases, where factors like the place of injury, where the contact occurred, the parties' domicile, and the relationship's center are considered. Ms. Mehrbach's ties to Florida, including her previous residency and the location of relevant financial transactions, support the application of Florida law. Both parties have cited Florida law without objection, solidifying its applicability. Although Ms. Mehrbach references the District of Columbia's negligence standard, the Florida standard is similar, justifying its use for consistency.

The Court evaluates Ms. Mehrbach's claims under the prior version of Fla. Stat. 655.059, effective before the 2018 amendments, as Citibank complied with the subpoena prior to the changes. Additionally, claims under the Gramm-Leach-Bliley Act (GLBA) have consistently been deemed non-actionable by courts, indicating no private right of action exists under this statute. Citibank contends that Ms. Mehrbach has not sufficiently pleaded damages for her negligence claim; however, the Court finds that Citibank does not owe her a duty, rendering the damages issue moot. Furthermore, Ms. Mehrbach's claim of a violation of the Florida Constitution regarding the disclosure of her bank records is unviable, as the Constitution protects against governmental intrusion, not private actions.

Banks have a limited duty to protect customers' confidential information, but Ms. Mehrbach's case does not involve governmental intrusion, thus failing to support an independent constitutional claim. The referenced constitutional provision applies solely to government actions, and while a court order for discovery may represent governmental intrusion, Ms. Mehrbach's claims are centered on Citibank's response to a subpoena from an opposing party, not a government entity. Furthermore, Ms. Mehrbach did not exhaust her options to protect her confidential records; despite the Florida court denying her motion for a protective order on procedural grounds, this denial was without prejudice, and she did not renew her request. Ms. Mehrbach's argument that the statute allowing disclosure under court compulsion differs from a subpoena issued by a party lacks support, as the statute does not make such a distinction and permits disclosure under subpoenas as per the Florida Rules of Civil Procedure. Consequently, the court grants Citibank's motion to dismiss and will not address Citibank's alternative motion for summary judgment regarding Ms. Mehrbach's alleged waiver of claims through the Client Manual.