The checklist for routine maintenance on the three automated teller machines owned by First Community Bank and Trust of Beecher, Ill., contains one head-scratching item: the maintenance worker is regularly required to take a photo of the machine to keep on file at the $147 million-asset bank as a defense in potential lawsuits.

Now Greg Ohlendorf, the bank's chief executive officer, can cross that mundane task off the list. A bipartisan law signed last month by President Obama overturns a legal requirement that required banks to post physical signs notifying users of potential fees.

The placard requirement was widely seen as redundant, given that modern ATMs give users the opportunity to accept or refuse fees via an onscreen notification. But it was seized on by plaintiffs' attorneys who, by one estimate, filed as many 2,000 lawsuits against ATM operators that failed to display the placards.

"We would take a photo of the machine that was time and date stamped," Ohlendorf said. "It sounds silly. But we wanted to have a process that we could say in court, if necessary, that we were doing our due diligence."

"I don't know how that would have stood up," Ohlendorf added, noting that First Community Bank and Trust was never sued under the old law. "Thank God I didn't have to go through that."

Though the new law took more than eight months to enact, it was a victory for a broad coalition of banks, credit unions, convenience stores, casinos, and independent ATM operators. For the owners of ATMs, the law's impact can be measured not only by shorter maintenance checklists, but more significantly, in reduced legal costs.

"The case for the bill was straightforward, streamlining a duplicate, unnecessary requirement while protecting notice and access for the consumer," said June Langston DeHart, a partner at Manatt, Phelps & Phillips LLP in Washington. "It's going to close the door on these spurious lawsuits."

Her law firm represents Cardtronics, one of the world's largest independent ATM operators, with more than 36,000 machines worldwide. Cardtronics estimates that it spent more than $1 million over the last 18 months defending the suits, DeHart said.

No industry-wide data is available on the impact of the lawsuits, but Bruce Renard, executive director of the National ATM Council, estimated that 2,000 suits were filed, and many of them settled out of court for around $10,000 each.

The suits were often brought by lawyers who were associated with individuals who would scout out ATMs that had missing placards. The lawyers were counting on quick settlements with ATM owners, according to Renard, to make the suits cost-effective. Indeed, many financial institutions calculated that the cases would cost much more than $10,000 to defend, and quickly cut a check.

"Litigation is always a roll of the dice," Renard commented.

Banks and credit unions saw the lawsuits as a nuisance because they were often by people who agreed onscreen to pay the $1.50 or $2 fee, which meant they didn't suffer any actual damage as a result of a missing physical sign. But given the phrasing of the old law, it wasn't clear that mattered, and financial institutions were reluctant to press their luck by holding out for a favorable court ruling.

Even more infuriating to banks and credit unions than the lawsuits themselves were allegations that in some instances, the plaintiffs actually vandalized the ATM by removing the placard before withdrawing cash. Those allegations were what led banks to start taking photographs of their machines.

"Checking the ATM once a year for signage is not enough," Thomas Alleman, a Dallas lawyer who represented community banks in these suits, wrote in a 2011 article that gave banks advice on how to fight back. "There should be signed and dated records showing that checks were made and signs replaced."

No matter how permanent the sign was made, it could be vandalized, according to Alleman, of the law firm Cox Moore. "Pried off, peeled off, whatever. And there's no question that this increased the cost for banks," he said Wednesday.

Wells Fargo (WFC), which operates a network of more than 12,000 ATMs in 39 states and the District of Columbia, also required its maintenance vendor to take photos of the fee-disclosure placards, according to Alicia Moore, the company's head of ATM banking.

"From Wells Fargo's standpoint it's a better customer service when we specifically disclose to a customer on the screen," she said. "That's a better customer experience than having a sticker somewhere on the hardware."

Delta Community Credit Union in Atlanta was one of the institutions that got sued under the old law. The case got settled within months, according to general counsel Bob Manning, but was nonetheless a nuisance for the credit union.

He was pleased with the new law. "It's just one less item that we need to concern ourselves with," he said.

One lingering issue for banks is whether the new law will impact lawsuits filed prior to the law's enactment, said Eric Magnuson, a lawyer at Nutter, McClellen & Fish LLP in Boston, who has defended financial institutions in these cases. But eventually the old cases will be resolved.

"And the class-action plaintiffs will have to find something else to complain about," Magnuson said. "It's kind of like whack-a-mole. You hit one thing and they find another."

Indeed other ATM-related lawsuits involving allegations that some banks are not in compliance with the Americans with Disabilities Act are thriving.

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