PHILADELPHIA – With tens of millions of dollars of liability at stake, Fifth Third Bank has asked a U.S. Appeals Court here to review a recent ruling by a three-member panel of the court that would enable Pennsylvania State Employees CU and hundreds of other credit unions to seek damages in credit card breaches from third-party processors.
The regional bank giant told the U.S. Court of Appeals for the Third Circuit it will seek an en banc review of the ruling which said the credit union and others can seek damages from the bank. The bank was a merchant acquirer for BJ’s, where card data for hundreds of credit unions was compromised in 2004.
Under an en banc review, all 21 judges of the appeals court would participate.
In its ruling, a three-judge panel of the court unanimously agreed to send the case back for a hearing by the district court, which had dismissed it because it found that third parties, such as the $3 billion credit union, had no standing to sue for card breaches.
The ruling also cleared the way for a separate suit filed in the case by Sovereign Bank.
In its suit, the credit union claims that even though the cards data was breached at BJ’s, Fifth Third had the responsibility to ensure that BJ’s was complying with Visa’s operating regulations, which bar merchants from retaining credit card information after completion of a transaction.
Pennsylvania State Employees says it spent almost $100,000 to reissue 20,000 Visa cards and to take other security measures during the BJ’s case.
The stakes are enormous for Fifth Third, as it also was the merchant acquirer in the TJX case.
In papers filed with the appellate court, Fifth Third argued that grounds exist for filing a petition for rehearing en banc the portion of the ruling that sent the case back to the lower court.
