Capital One settlement rejection: Will I still get money?

Tons of people who use a major bank in the United States were expecting to get a payout from a recent settlement.

However, said settlement just got rejected by a federal judge.

Reuters reports how U.S. District Judge David Novak of the Eastern District of Virginia rejected Capitol One’s $425 million settlement stemming from a class action lawsuit. According to Novak, the payout from the previously-approved agreement was too small, or, in his words, “neither reasonable nor adequate.”

This lawsuit concerns claims that the bank offered customers two similarly-named accounts — 360 Savings and 360 Performance Savings accounts — that paid very different rates. The bank was accused of “false or otherwise misleading” marketing of these accounts.

“The CFPB [Consumer Financial Protection Bureau] is suing for cheating families out of billions of dollars on their savings account,” said then-CFPB Director Rohit Chopra via press release. “Banks should not be baiting people with promises they can’t live up to.”

U.S. News & World Report states that many legal experts have praised Novak’s 11th-hour decision. As for what happens next, the parties involved might now renegotiate a new settlement amount that could mean more money in customers’ pockets.

However, U.S. News & World Report adds that class members might not get anything should this lawsuit go to trial.

“I think that’s extremely unlikely in this case,” told Ira M. Steinberg, a partner at Greenberg Glusker who specializes in commercial and business litigation, to the publication. “Given how much effort went into producing this settlement, that tells you that neither side really wants to go to trial if they can avoid it and both want to reach an accommodation.”

Further information regarding this lawsuit remains pending as of the publishing of this report.”