Court tosses ADA suit against Houston's Smart Financial Credit Union

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A federal judge on Friday dismissed a suit alleging a Texas credit union’s website violated the Americans with Disabilities Act.

On Friday, Jan. 25, the U.S. District Court for the Southern District of Texas dismissed a lawsuit filed against Smart Financial Credit Union, a $693 million-asset institution based in Houston. The court said the plaintiff did have standing as he “seemed to fall” in Smart Financial Credit Union's field of membership. However, the court ruled a website is “not a physical place,” meaning the credit union would not be liable under the ADA.

A number of previous ADA suits against CUs have been dismissed over a plaintiff’s lack of standing to sue due to ineligibility for membership.

This ruling seemingly is in conflict with a Jan. 15 ruling by the Ninth Circuit federal appellate court, which said the ADA could apply to the website and mobile app of a business that is a public accommodation where there is a “nexus” between the website and/or the app and the physical locations of the business in question.

The National Association of Federally-Insured Credit Unions, which had previously filed an amicus brief in support of Smart Financial CU, on Friday issued a statement regarding the dismissal. Carrie Hunt, NAFCU’s EVP of government affairs and general counsel, said the court’s decision “reinforces the need for the Department of Justice to provide clarity on ADA website requirements as different courts continue to come to different conclusions.”

NAFCU, the Credit Union National Association and other credit union trade groups have filed multiple amicus briefs supporting CUs hit with ADA suits – at least nine of which have been dismissed – and continue to push the DOJ to provide clarity on the issue once and for all.

Days prior to the court’s dismissal of the case against Smart Financial, CUNA and the Michigan Credit Union League filed two amicus briefs in the Sixth Circuit Court of Appeals in support of credit unions that had been hit with ADA-related lawsuits. In both of those cases, the CUs requested dismissal because the plaintiff was ineligible to join and therefore lacked standing.

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ADA Websites Litigation Field of membership Carrie Hunt NAFCU DoJ Texas
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