FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
PAUL D.S. EDWARDS, No. 06-16892
Plaintiff-Appellant,
v. D.C. No.
CV-05-01253-ECR
WELLS FARGO AND COMPANY,
OPINION
Defendant-Appellee.
Appeal from the United States District Court
for the District of Nevada
Edward C. Reed, District Judge, Presiding
Argued and Submitted
May 15, 2008—San Francisco, California
Filed May 19, 2010
Before: Andrew J. Kleinfeld and N. Randy Smith,
Circuit Judges, and Richard Mills,* District Judge.
Opinion by Judge Kleinfeld
*The Honorable Richard Mills, United States District Judge for the
Central District of Illinois, sitting by designation.
7157
EDWARDS v. WELLS FARGO 7159
COUNSEL
Paul D.S. Edwards, pro se, Las Vegas, Nevada.
Jay Earl Smith, Smith Larsen & Wixom, Las Vegas, Nevada,
for defendant-appellee Wells Fargo Bank.
OPINION
KLEINFELD, Circuit Judge:
We address what seems like a simple question, but because
of the language of the applicable regulatory framework, it
turns out not to be simple: does a credit card issuer have to
resolve disputes about purchases with the consumer who used
the card to buy the goods, or just with the person who
obtained the card and authorized issuance of another card to
the consumer? The answer is, the latter.
7160 EDWARDS v. WELLS FARGO
FACTS
The district court decided this case on a motion to dismiss
for failure to state a claim, pursuant to Federal Rule of Civil
Procedure 12(b)(6). Both parties presented affidavits and
other material outside of the pleadings, in support of and in
opposition to, the motion. The district court did not exclude
any of these materials, and took them into account in his deci-
sion, so “the motion must be treated as one for summary judg-
ment under Rule 56.”1 Accordingly, we take the facts as
established by the evidence to the extent that they are undis-
puted, and in favor of the respondent, Edwards, to the extent
material facts are genuinely in dispute,2 and treat this as an
appeal from summary judgment.
Wells Fargo Bank issued a Visa credit card to Hamid
Maghamfar. Saeid Maghamfar was added to the account
about five years later. Both Maghamfar brothers signed a
form by which they agreed to be “equally responsible for the
repayment of current and future charges on the account and
will have equal access to all account services and features.”
For reasons not disclosed in the record, Hamid Maghamfar
subsequently arranged with Wells Fargo and Paul Edwards to
have an additional credit card issued on the Maghamfar
account to Edwards, the plaintiff and appellant. They made
the arrangement on the phone, with Maghamfar and Edwards
making the call together and talking to some unknown Wells
Fargo Visa representative. Their arranging for someone other
than the person paying the bills to the bank to get a credit card
is like the common scenario where parents get a credit card
for a child in college.
1
Fed. R. Civ. P. 12(d); see also Fed. R. Civ. P. 56; Swedberg v.
Marotzke, 339 F.3d 1139, 1143-44 (9th Cir. 2003).
2
Hauk v. JP Morgan Chase Bank USA, 552 F.3d 1114, 1117-18 (9th
Cir. 2008); Lombardo v. Warner, 353 F.3d 774, 776 (9th Cir. 2003).
EDWARDS v. WELLS FARGO 7161
Edwards submitted a sworn affidavit saying that the Wells
Fargo representative required him to provide identifying
information including his social security number, and told
him on the phone that he would be personally liable, as well
as the Maghamfars, for any purchases he made on the card.
Wells Fargo, however, submitted an affidavit swearing that
they would not hold Edwards personally responsible. There is
no form in the record signed by Edwards like the one that the
Maghamfars signed promising the bank to be responsible for
charges.
Edwards had numerous disputes with merchants with
whom he used the Visa card. They range from a $36.28
charge at Kinko’s that Edwards claims he never incurred, to
$794.95 for a grey suit that Edwards says was defective and
not properly altered. Edwards wrote to Wells Fargo, and for
a while, thinking that he was a lawyer representing the
Maghamfars, Wells Fargo resolved the disputes with him.
(Edwards never claimed to be the Maghamfars’ lawyer, but
cited and quoted the Fair Credit Billing Act and Regulation Z
in detail, so Wells Fargo assumed he was.) Eventually Wells
Fargo realized that Edwards was writing on his own behalf,
not on behalf of the Maghamfars, and quit responding to him
about his billing disputes. The bank wrote to the Maghamfars
instead, and charged their account when they did not respond.
Edwards sued Wells Fargo for actual, statutory, and puni-
tive damages under the Fair Credit Billing Act, a subpart of
the Truth in Lending Act,3 and under the Nevada Unfair Con-
sumer Practices Act.4 The basis for these claims are the seven
billing disputes, all well under $1,000, that Wells Fargo did
not resolve with Edwards and with respect to which Wells
Fargo did not respond to Edwards’ correspondence. On
3
15 U.S.C. § 1640; see also Fair Credit Billing Act, Pub. L. No. 93-495,
tit. III, § 301, 88 Stat. 1500, 1510-11 (1974).
4
Nev. Rev. Stat. §§ 598.0915, .0923, .0973, .0977.
7162 EDWARDS v. WELLS FARGO
appeal, Edwards makes no argument regarding his Nevada
state law claims, so we do not address those claims.
ANALYSIS
Summary judgment is proper if the pleadings and other evi-
dence before the court “show that there is no genuine issue as
to any material fact and that the movant is entitled to judg-
ment as a matter of law.”5 We review the grant of summary
judgment de novo, viewing the evidence and drawing all rea-
sonable inferences in the light most favorable to the non-
moving party.6
Edwards argues that as a consumer, cardholder, and user of
a credit card issued on the Maghamfar account, he was enti-
tled to the dispute resolution procedures that federal law
requires a credit card issuer to follow.7 He correctly points out
that under the Truth in Lending Act8 and regulations imple-
menting it,9 a credit card issuer owes an obligation to respond
to, investigate and resolve disputes regarding purchases. The
question in this case is to whom that obligation is owed.
[1] The statute says that the creditors’ billing dispute duties
run to the “obligor” on the account.10 Neither the statute nor
the regulations define “obligor,” so we use the ordinary legal
5
Fed. R. Civ. P. 56(c).
6
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-52 (1986).
7
The federal statutes are like Russian matryoshka dolls, stacked one
within another, so we refer to the United States Code sections for
improved clarity. The popular names for legislation that enacted the provi-
sions at issue are the Fair Credit Billing Act, the Consumer Credit Protec-
tion Act, and the Truth in Lending Act.
8
15 U.S.C. § 1666.
9
Regulation Z, 12 C.F.R. §§ 226.1-226.34.
10
15 U.S.C. § 1666(a) (“If a creditor, within sixty days . . . receives . . .
written notice from an obligor . . . the creditor shall . . . send a written
acknowledgment [of the claimed billing error] to the obligor.”).
EDWARDS v. WELLS FARGO 7163
understanding in this context, one who is obligated to pay a
debt.11 And here we run into the first potential difficulty, that
Wells Fargo told Edwards on the telephone that he was an
obligor, but told the district court in a sworn affidavit that he
was not. After this dispute had crystallized and before
Edwards filed suit, Wells Fargo put in writing its current posi-
tion that Edwards is not obligated to pay Wells Fargo for
charges on the credit card.
In spite of stating that the Wells Fargo representative told
him he would be personally liable on the card, Edwards does
not claim to be an obligor on the account. Instead, he argues
that because he was the “cardholder” and “consumer,” Wells
Fargo owed him the obligation regardless of whether he was
the obligor. Wells Fargo argues that although Edwards was an
“authorized user” he was not the “account holder” or “obli-
gor,” so he lacked “standing” to pursue the claim. The bank
uses the word “standing” to mean, not its usual Article III
meaning, but merely that the statute and regulations establish
no duty running to him. Because Edwards argues that he is
entitled to the billing dispute procedures because he is a
“cardholder,” “consumer” and “user” of the card, and not
because he is also an “obligor” under the statute, we assume
for purposes of decision that Wells Fargo does not owe any
duty to Edwards as an “obligor” under the statute.
We need to detour into vocabulary to make the arguments
comprehensible. A “cardholder” under the statute means a
“person to whom a credit card is issued or a person who has
agreed with the card issuer to pay obligations arising from the
issuance of a credit card to another person.”12 Edwards is a
“cardholder” under the first of these alternative definitions
regardless of whether the telephone call in which he was told
11
Black’s Law Dictionary (7th ed. 1999) (defining “obligor” as “[o]ne
who has undertaken an obligation; a promisor or debtor).
12
15 U.S.C. § 1602(m). See also 15 U.S.C. § 1602(d) (defining “person”
as a “natural person or organization”).
7164 EDWARDS v. WELLS FARGO
he would have to pay would also make him a “cardholder”
under the second. Wells Fargo issued a Visa credit card to
him in his name to be used for consumer credit purposes.
Whatever duty Wells Fargo owed to a cardholder, it owed to
Edwards.
[2] The statutory language discussing the credit card issu-
ers’ duties means that the duties were not owed to Edwards,
just to the Maghamfars because they, and not he, were the
obligors. The statute says that if the creditor receives timely
written notice from “the obligor” of a claimed billing error,
the creditor must send timely written acknowledgment to the
“obligor” within strict time limits.13 If we could stop there,
this would be an easy case. Edwards does not argue that he
is an “obligor” and is entitled to the procedures owed to obli-
gors. We cannot stop there, though, because the implementing
regulations create a dense fog around the straightforward stat-
utory language.
[3] The statute expressly delegates authority to the Federal
Reserve Board to issue implementing regulations.14 The Fed-
eral Reserve Board has done so in a lengthy document called
“Regulation Z,” accompanied by extensive official, published
staff interpretation. The matter is so complexified by regula-
tion Z that it took a Supreme Court opinion just to say (in the
context of company credit cards issued to individual employ-
ees) what a consumer is15 even though the word consumer is
defined by the regulation,16 or perhaps because the word is
defined by the regulation.
13
15 U.S.C. § 1666.
14
15 U.S.C. § 1604 (“The Board shall prescribe regulation to carry out
the purposes of this subchapter.”).
15
See Am. Express Co. v. Koerner, 452 U.S. 233, 241-45 (1981).
16
12 C.F.R. § 226.2(a)(11) (defining “consumer” as a “cardholder or
natural person to whom consumer credit is offered or extended”); see also
12 C.F.R. § 226.2(a)(12) (defining “consumer credit” as “credit offered or
extended to a consumer primarily for personal, family, or household pur-
poses”).
EDWARDS v. WELLS FARGO 7165
Edwards argues that regardless of whether he is an obligor,
the statute requires the bank to deal with him on his billing
disputes because it has a duty to deal with “consumers.” The
policy of the Act, he correctly argues, as declared in the stat-
ute, is to protect “consumers” regarding extension of credit.17
The bank argues that there was no extension of credit, but that
is incorrect, since Edwards got the disputed suit and the other
goods giving rise to billing errors before they were paid for.
What matters for our purposes is that, assuming that Edwards
is not an obligor on the card because he does not claim to be
one, the extension of credit was to the Maghamfars, not
Edwards. Wells Fargo never “offered” or “extended” credit to
Edwards personally. Rather, the Maghamfars let Edwards
incur debts on their behalf. In “adding” Edwards, Wells Fargo
simply made it possible for him to use credit it extended to the
Maghamfars.
Edwards claims to be a “cardholder” to whom an obligation
is owed, and the Bank claims that he is not. Plainly, he physi-
cally held a card, but that is not the end of the issue. Regula-
tion Z defines “cardholder,” so the definition controls. There
are two definitions of “cardholder” in the regulations. One
definition fits Edwards, “a natural person to whom a credit
card is issued for consumer credit purposes[.]”18 The second
definition applies to the Maghamfars, not Edwards. The sec-
ond definition says that a “cardholder” includes “a natural
person who has agreed with the card issuer to pay consumer
credit obligations arising from the issuance of a credit card to
another natural person.”19 Wells Fargo’s argument that
Edwards is not a “cardholder” because he does not fit one of
17
15 U.S.C. § 1601(a) (“It is the purpose of this subchapter to assure a
meaningful disclosure of credit terms so that the consumer will be able to
compare more readily the various credit terms available to him and avoid
the uninformed use of credit, and to protect the consumer against inaccu-
rate and unfair credit billing and credit card practices.”)
18
12 C.F.R. § 226.2(a)(8).
19
12 C.F.R. § 226.2(a)(8).
7166 EDWARDS v. WELLS FARGO
the two definitions is mistaken, since Edwards fits squarely
into the first, and the definitions are stated in the alternative,
separated by “or,” not “and.” Wells Fargo says that the Offi-
cial Staff Interpretation of that regulation “clears this up” and
shows decisively that Edwards is not a “cardholder” because
it excludes one who “is merely the authorized user of a card
issued to another.”20 That phrase does indeed exclude
Edwards, but it only applies to the second alternative, not the
first. Thus Wells Fargo’s argument that Edwards is not a
“cardholder” is simply incorrect. But it is also beside the
point.
[4] Regulation Z makes the target credit card issuer’s duty
to resolve billing disputes less rather than more clear. Rather
than describing the issuer’s duties to the “obligor,” as the stat-
ute does, it describes them as to the “consumer.”21 The billing
dispute resolution process is triggered, under Regulation Z, by
written notice from “a consumer,”22 not the “obligor.” The
creditor has to send to the “consumer” written acknowledg-
ment of receiving that notice.23 Edwards argues that he is the
consumer, so Wells Fargo should have resolved the disputes
with him. This argument is plausible, because in ordinary
speech the “consumer” would be the person who bought
things, and Edwards would know first hand about the issues
regarding his grey suit or his visit to Kinko’s, and the obli-
20
12 C.F.R. § 226 Supp. I at 371 (Official Staff Interpretations) (“A
cardholder is a natural person at whose request a card is issued for con-
sumer credit purposes or who is a co-obligor or guarantor for such a card
issued to another. The second category does not include an employee who
is a co-obligor or guarantor on a card issued to the employer for business
purposes, nor does it include a person who is merely the authorized user
of a card issued to another.”).
21
12 C.F.R. pt. 226, supp I. § 226.13(1), et seq.
22
12 C.F.R. § 226.13(b) (“A billing error notice is a written notice from
a consumer . . . .”).
23
12 C.F.R. § 226.13(c)(1) (“The creditor shall mail or deliver written
acknowledgment to the consumer within 30 days of receiving a billing
error notice . . . .”).
EDWARDS v. WELLS FARGO 7167
gors, the Maghamfars, would not. Neither Regulation Z nor
the Official Staff Interpretation offer any explanation of why
they departed from the statutory term, “obligor,” and “substi-
tuted the term “consumer” to delineate the billing dispute res-
olution obligation.
[5] It is hard to say whether Edwards is a “consumer” as
defined by the regulation, “a cardholder or natural person to
whom consumer credit is offered or extended.”24 He is a natu-
ral person and a cardholder, but since he is not the obligor on
the credit card, it is hard to say whether he is the person “to
whom consumer credit is offered or extended.” The statute
defines “credit” as “the right . . . to defer payment of debt or
to incur debt and defer its payment.”25 The Maghamfars are
the obligors with the right to defer payment of debt, but
Edwards is the person with the credit card, it is Edwards who
appears to be the person who can incur debt, as he did when
he bought the grey suit. And Edwards had the right to defer
payment to the merchant until Wells Fargo sent the merchant
payment, but the Maghamfars and not Edwards had the right
to defer payment to Wells Fargo.
Whether Regulation Z and the Official Staff Commentary
impose on Wells Fargo a duty to communicate with the con-
sumer, or even if Edwards is the consumer for this purpose,
is not ascertainable with certainty. Neither provision says in
so many words with whom the credit card issuer is supposed
to resolve billing disputes. The Official Staff Interpretation
says that “[d]isclosures may be made to either obligor on a
joint account” and are “not satisfied by giving disclosure only
24
12 C.F.R. § 226.2(a)(11); see also 15 U.S.C. § 1602(h) (“The adjec-
tive ‘consumer’, used with reference to a credit transaction, characterizes
the transaction as one in which the party to whom credit is offered or
extended is a natural person, and the money property, or services which
are the subject of the transaction are primarily for personal, family, or
household purposes.”).
25
15 U.S.C. § 1602(e).
7168 EDWARDS v. WELLS FARGO
to a surety or guarantor for a principal obligor or to an autho-
rized user[,]” but “[i]n rescindable transactions . . . separate
disclosures must be given to each consumer who has the right
to rescind under § 226.15.”26 The section referred to,
§ 226.15, relates to mortgages and deeds of trust on principal
dwellings,27 not purchases of goods where the consumer has
a right to return them to the store, so the regulation combined
with the staff interpretation means that the issuer cannot sat-
isfy its disclosure responsibility by disclosing to the autho-
rized user, and must disclose to an obligor. But that is not the
same thing as saying that the issuer need not disclose to the
authorized user as well.
[6] Without much confidence, we conclude that even
though Edwards is a “consumer” in the ordinary sense of the
word, and even though it would make sense for Wells Fargo
to discuss his grey suit problems with him and no practical
sense to discuss it with the Maghamfars who did not buy the
suit and would not likely know much about it, he is not a
“consumer” in the bizarre usage of Regulation Z. He obtained
credit from the merchant who sold him the grey suit, perhaps,
but it seems more straightforward to treat the Maghamfars,
who owe the money, as obtaining credit from Wells Fargo.
Regulation Z says, in the course of setting out the credit card
issuer’s duties to the “consumer,” that the “consumer” may
withhold disputed amounts on the credit card and prohibits
collection efforts against the “consumer.”28 Assuming that
Edwards is not an obligor on the card, there could not be any
question of his withholding payment, nor could there be any
collection efforts against him, so the Regulation Z procedures
would make no sense if he were the “consumer” Regulation
Z is talking about. Also, the Regulation Z version of the credit
card issuer’s duties to the “consumer” expressly addresses
“billing error resolution” and defines “billing error” as an
26
12 C.F.R. pt. 226, supp. I § 226.6 at 391.
27
12 C.F.R. § 226.15.
28
12 C.F.R. § 226.13(d).
EDWARDS v. WELLS FARGO 7169
error of various kinds on the “periodic statement” and failure
to mail the “periodic statement” to the “consumer’s last
known address.”29 Periodic statements are sent to the obligor
on the credit card, not additional cardholders who are not
obligors. Additional cardholders who are not obligors do not
have any duty to the issuer to pay the bill. These references
therefore make no sense if by “consumer” Regulation Z
means consumer in the ordinary sense of the word.
[7] Finally, it would be quite a big step if the Federal
Reserve Board converted a statutory obligation owed only to
an “obligor” under the statutory language30 into one owed to
every college student using a credit card issued to a parent,
when the child had a dispute with a pizza parlor. It might
make some sense, since the college student and not the parent
would know the details of the pizza transaction, or it might
not because resolving disputes would require more time and
personnel, but Congress did not say that the billing error reso-
lution duty runs to all authorized cardholders. It designated
only obligors. The parents, not the bank, have the burden of
discussing the pizza parlor dispute with their child. Although
we remain mystified about why Regulation Z does not use the
same word as the statute, “obligor,” and why it uses “consum-
er” to mean something that excludes many consumers who
would know about the disputed transactions when the obligors
do not, that is what it does.
AFFIRMED.
29
12 C.F.R. § 226.13(a) (defining “billing error” as in error reflected on
the “periodic statement” or the “creditor’s failure to mail or deliver a peri-
odic statement to the consumer’s last known address”).
30
15 U.S.C. § 1666(a).