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A New York judge has said that crypto purchases might not be cash advances, and a class action suit against Chase can largely proceed.
Southern District of New York Judge Katherine Polk Failla has ruled that purchasing cryptocurrency with a Chase Bank credit card does not necessarily count as a cash advance, as per Chaseâs contract.
According to an opinion and order document dated August 1, Judge Failla has denied Chaseâs motion to dismiss a number of the plaintiffâs complaints, which center on the bank charging a user cash advance fees for buying cryptocurrency with a Chase credit card.
The plaintiffs are Brady Tucker, Ryan Hilton and Stanton Smith, who have brought a class action suit against banking giant Chase.
In the document, Failla summarized their class action suit as follows:
âThis claim â indeed, the entirety of Plaintiffsâ suit â is built on an argument that acquisitions of cryptocurrency could not be classified as cash advances within the meaning of the Contracts. [...] Chase disagrees, claiming that cryptocurrency acquisitions are âcash-like transactionsâ pursuant to the Contracts, and thus cash advances. The partiesâ dispute thus boils down to a difference of opinion concerning the proper interpretation of the term âcash-like transaction.ââÂ
The reason that a number of Chaseâs dismissal motions have not gone through is because Judge Failla believes that the plaintiffs have provided a reasonable interpretation of the term âcash-like transactionâ in the context of Chaseâs contract.Â
As Failla also explains in the document, the plaintiffs are interpreting the word cash as referring only to fiat money, and cash-like as referring only to legally-recognized claims on cash â such as checks, money orders, and wire transfers, and notably not cryptocurrency. The defendants, on the other hand, believe that the term cash-like transactions applies to any means of payment, cryptocurrency-based or otherwise.
Notably, Judge Failla has not sided with the plaintiffs and said that their interpretation is correct. Rather, Failla has simply noted that their interpretation is plausible enough for them to proceed with their class action case. Failla wrote:
âAt this point in the proceedings, however, it is irrelevant whether Chaseâs interpretation of âcashlike transactionsâ is more reasonable than Plaintiffsâ. [...] Because Plaintiffs have identified a reasonable interpretation of âcash-like transactions' that would exclude purchases of cryptocurrency, the breach of contract claim survives the motion to dismiss.â
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