Court filing
14AB — In re Bank of America California Unemployment Benefits Litigation (Dkt. 591-26, S.D. Cal. No. 3:21-md-02992)
Filed October 17, 2025 in In re Bank of America California Unemployment Benefits Litigation; one of 1415 filings from this case.
Record facts
| Court | U.S. District Court for the Southern District of California |
|---|---|
| Filed | 2025-10-17 |
U.S. District Court for the Southern District of California · No. 3:21-md-02992-GPC-MSB · Doc. 591-26 · 2025-10-17 · Docket on CourtListener
Full text
DX 14.AB
REDACTED VERSION OF
DOCUMENT SOUGHT TO
BE SEALED PURSUANT TO
STIPULATED
PROTECTIVE ORDER
Case 3:21-md-02992-GPC-MSB Document 591-26 Filed 10/17/25 PageID.41286
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UNITED STATES DISTRICT COURT
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SOUTHERN DISTRICT OF CALIFORNIA
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SAN DIEGO DIVISION
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IN RE BANK OF AMERICA ) Case No.
CALIFORNIA UNEMPLOYMENT ) 21-MD-02992 LAB-MSB
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BENEFITS LITIGATION )
________________________________)
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)
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This Document Relates to )
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All Actions )
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)
________________________________)
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HIGHLY CONFIDENTIAL
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VIDEO-RECORDED DEPOSITION OF GREG REGAN
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Monday, May 19, 2025
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San Francisco, California
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Stenographically Reported By:
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Hanna Kim, CLR, CSR No. 13083
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Job No. 7289038
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THE COURT REPORTER: And, Counsel, while
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we do that, may we go off the record for a quick
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audio fix.
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MR. RIFFEE: Sure.
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THE VIDEOGRAPHER: Going off the record. 10:17:51
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The time is 10:17 a.m.
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(Regan Deposition Exhibit 1 was marked for
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identification.)
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(Regan Deposition Exhibit 2 was marked for
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identification.) 10:19:01
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(Regan Deposition Exhibit 3 was marked for
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identification.)
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THE VIDEOGRAPHER: Going back on the
14
record. The time is 10:20 a.m.
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BY MR. RIFFEE: 10:20:16
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Q. Back on the record. Welcome back.
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Handed you three documents. The first
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one, can -- if you could look at, it's been marked
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as Exhibit 1.
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Do you recognize this document? 10:20:25
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A. Yes, I do.
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Q. Is this a copy of the affirmative expert
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report that you submitted in this case on March 4th,
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2025, in support of plaintiffs' case?
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A. Yes, it is. 10:20:37
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Q. Okay. Does Exhibit 1 accurately describe
2
the opinions you expect to provide in this case?
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A. Yes, I believe so.
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Q. And does it accurately describe the
5
damages theories, models, and calculations that you 10:20:46
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intend to apply in this case?
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A. Yes.
8
Q. Are there any errors or any corrections
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that you would like to make to your report at this
10
time? 10:20:57
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A. There's one thing that comes to mind.
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Q. Is it the section reference?
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A. I'm going to give it -- I'm going to give
14
it to you.
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I -- there are two cross-reference errors 10:21:06
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that popped up on the last refresh that I didn't
17
catch. Hopefully that didn't cause too much
18
confusion.
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Q. No, that's not a problem. That's --
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that's what I assumed when you said there was one 10:21:18
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thing.
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A. I was, however, going to bring something
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to your attention.
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Q. Okay.
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A. In the -- on page 39 of the report, in 10:21:30
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Paragraph 85, there is a table, and the row that's
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called "Cost of delayed benefit payments" -- in each
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of the two different illustrations, I applied a
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20 percent interest rate to calculate the cost of
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the delayed benefit payment. For the 10 percent 10:21:53
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column, I should have used a 10 percent rate, in
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which case the amount is exactly half of what it is
8
presently.
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But I believe that's the only other item
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I -- I noticed in preparation. 10:22:08
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Q. Okay. Thank you for that.
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So other than the correction in the table
17
errors that you would like to make at this time; is
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that right?
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A. That's correct.
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Q. Okay. Have you formed any additional 10:22:34
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opinions that you intend to offer in this case that
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is not mentioned in -- in this report, Exhibit 1?
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A. I don't believe I formed additional
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opinions. I would say that after the receipt of the
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bank's expert reports on April 4th, I thought about 10:22:59
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the criticisms that were expressed on those reports,
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a number of which were addressed in what is
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Exhibit 3 that I'm sure we'll get to, which was my
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rebuttal report of November 21st, 2024. But I
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don't -- I don't believe I formed new opinions. 10:23:18
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Q. Okay. If you -- you can put that aside
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for now, but I assure you we'll be returning to it.
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If you could look at the exhibit that's
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been marked as Exhibit 2.
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Do you recognize this document? 10:23:31
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A. Yes, I do.
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Q. Is this a copy of the expert report that
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you submitted in this case on August 29, 2024, in
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support of plaintiffs' motion for class
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certification? 10:23:43
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A. It is.
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Q. Okay. To the extent the opinions or
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methodologies that you express in Exhibit 1, your
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March 4, 2025, report, are different than the
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opinions and methodologies that you express in 10:23:48
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Exhibit 2, your class certification report, is
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Exhibit 1 intended to supersede your -- your class
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certification report, Exhibit 2?
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A. Yes, it is.
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Q. Okay. So can we assume that to the extent 10:24:03
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your opinions and methodologies are different in
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Exhibit 1, that you no longer intend to offer those
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opinions from Exhibit 2 in this case?
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A. That's correct.
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Q. If you could please look at the document 10:24:18
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that's been marked as Exhibit 3.
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Do you recognize this document?
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A. Yes, I do.
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Q. Okay. Is this a copy of the reply or
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expert rebuttal report that you issued on 10:24:30
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November 21st, 2024, in support of plaintiffs' class
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certification motion?
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A. It is.
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Q. Okay. And I'll ask you the same question:
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To the extent the -- the opinions or methodologies 10:24:43
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expressed in Exhibit 3 are different than the
17
opinions and methodologies that you expressed in
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Exhibit 1, your March 4, 2025, report, is your
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March 4, 2025, report, Exhibit 1, intended to
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supercede those opinions? 10:25:02
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A. Yes.
22
Q. Okay. Have you done any additional work
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for plaintiffs since your affirmative report was
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served on March 4, 2025?
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MS. CHAN: Objection. Vague. 10:25:17
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THE WITNESS: The work I have done since
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this time would be -- would consist of reviewing the
3
reports submitted by the bank on April 4th, 2025.
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And when I say those reports, I can think of
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Mr. Stan- -- Dr. Stango's, Dr. McCrary, I don't know 10:25:40
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if it's Mr. or Dr. Prye, I believe Hindle -- the
7
Hindle report, as well as reviewing other reports
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submitted by the bank -- or excuse me, by -- by
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plaintiffs, including Dr. East and Dr. Levine, and
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considering that information in preparation for my 10:26:10
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deposition today.
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BY MR. RIFFEE:
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Q. So you believe since you issued your
14
report on March 4, 2025, you reviewed four reports
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issued by Bank of America's experts, Dr. Stango, 10:26:24
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Dr. McCrary, Dr. Prye and Mr. Hindle; is that
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correct?
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MS. CHAN: Objection. Mischaracterize --
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misstates the testimony.
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THE WITNESS: At least those four. Maybe 10:26:35
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another one that you'll refresh my recollection on.
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And one that I left out was Minnucci from -- from
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plaintiffs.
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BY MR. RIFFEE:
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Q. Okay. And then you've also reviewed 10:26:44
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reports submitted by -- by -- I believe it's
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Ms. East, Mr. Levine, and Mr. Minnucci?
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A. Correct.
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Q. Okay. Have you conducted any further
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calculations since you issued your report on 10:27:04
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March 4, 2025?
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A. I -- I've certainly looked at the data, in
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terms of understanding some of the assertions made
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by Mr. Stango, but I haven't submitted or developed
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any new schedules or anything like that. 10:27:22
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Q. Do you anticipate doing any additional
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work for this matter that is not reflected in your
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March 4, 2025, report marked as Exhibit 1?
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MS. CHAN: Objection. Vague.
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THE WITNESS: I don't have any specific 10:27:32
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expectations. I can imagine developing some charts
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or graphics that might summarize some of the data
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expressed in the report, using the schedules that
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accompany the report, but I think the report itself
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encompasses the opinions I would expect to offer. 10:27:52
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BY MR. RIFFEE:
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Q. Okay. If you could please turn back to
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Exhibit 1. And I'd ask you to turn to page 3,
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Paragraph 5.
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A. I'm there. 10:28:13
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for various different consumer credit types.
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Q. Credit types being credit scores?
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A. I call it credit classifications.
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Q. Okay.
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A. I can point you to the paragraph that I'm 10:44:04
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thinking about. It's Paragraph 40-A on page 21 and
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its attendant table.
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MS. CHAN: Counsel, he already testified
9
that Mr. Carter is his agent; he was assisting him
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in preparation of his report. So all of his 10:44:23
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communications with his own staff and his agents
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is -- is protected as his work product. You haven't
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established that there was anyone else present
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during those conversations.
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MR. RIFFEE: Are you asserting an 10:44:36
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objection and instructing him to not answer? I
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mean, he's answered. There was no objection.
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MS. CHAN: I'm cautioning him to -- not to
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disclose further work product, and I'm also advising
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you not to pursue this line of questions. 10:44:48
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MR. RIFFEE: Okay.
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BY MR. RIFFEE:
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Q. But based on the conversations that you
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had with Mr. Carter, there was -- there's nothing
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that you believe that you need to change or -- or 10:44:57
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revise about your report; correct?
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A. No. Only the one item I raised at the
3
outset of the deposition.
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Q. Other than the meeting with counsel and
5
having conversations with Mr. Carter, did you do 10:45:14
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anything else to prepare for your deposition today?
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A. No, other than read materials by -- by
8
myself.
9
Q. Okay. Do you consider yourself to be an
10
expert in the Electronic Funds Transfer Act, which 10:45:25
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I'm may call EFTA today, or Regulation E?
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A. No.
13
Q. Do you consider yourself to be an expert
14
in what EFTA and Regulation E may require for
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financial institutions in investigating or crediting 10:45:41
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unauthorized transaction claims for prepaid
17
accounts?
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A. No.
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Q. Do you consider yourself to be an expert
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on financial institutions' unauthorized transaction 10:45:51
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claim practices or -- or procedures?
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THE COURT REPORTER: I'm sorry.
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"Unauthorized transaction"...
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BY MR. RIFFEE:
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Q. Transactions claims practices or 10:45:59
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THE WITNESS: I believe the -- given the
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nature of the class, that it -- that type of harm
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was -- was incurred by individual consumers. And
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that conclusion's consistent with Dr. East and
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Dr. Levine's findings. 11:07:25
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BY MR. RIFFEE:
7
Q. Have you reviewed any evidence to confirm
8
that even one single proposed class member actually
9
themselves incurred interest at, at least a
10
20 percent interest rate? 11:07:36
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MS. CHAN: Objection.
12
THE WITNESS: It's my expectation that
13
there are consumers that experience costs that
14
exceed that. The objective of illustrating my
15
analysis using a 20 percent rate was to identify a 11:07:49
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median type of harm that was incurred by consumers
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and measure it in that -- in that way.
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BY MR. RIFFEE:
19
Q. That wasn't -- that wasn't my question.
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So I understand that's your expectation, 11:08:03
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but did you review any evidence to confirm that
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anyone actually did -- in the proposed classes or
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any of the -- the class plaintiffs actually incurred
24
borrowing costs at a 20 percent interest rate or
25
higher? 11:08:16
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MS. CHAN: Objection. Vague.
2
THE WITNESS: I did not do it at an
3
individual level because I didn't have data to
4
indicate that that outcome would be reasonably
5
extracted to the population as a whole. So what I 11:08:35
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did was to develop my understanding of the overall
7
population of consumers.
8
BY MR. RIFFEE:
9
Q. And that was based on your research and --
10
and information generally, but not specific to 11:08:45
11
the -- the actual class members; correct?
12
MS. CHAN: Objection.
13
THE WITNESS: It was my research regarding
14
the typical type of harm incurred by members of the
15
proposed class. 11:08:58
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BY MR. RIFFEE:
17
Q. Have you ever been retained, prior to this
18
case, to calculate damages concerning the denial of
19
unauthorized transaction claims?
20
A. I -- I don't believe so. 11:09:09
21
Q. Have you ever been retained to calculate
22
damages concerning an account freeze or similar
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restriction placed on a financial account that
24
prevented an accountholder from accessing the funds
25
in that account? 11:09:41
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for example, articulated in his report. But I
2
believe that I've identified all of those instances,
3
and I'm not aware of anything that was withheld from
4
me. It's a matter of the state of production.
5
Q. All right. 11:19:17
6
In footnote 22 to that same paragraph,
7
Paragraph 30, you write, "In addition, other
8
evidence may be produced that could be relevant to
9
my conclusions, including the testimony and report
10
of other witnesses. Accordingly, I reserve the 11:19:37
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right" --
12
THE COURT REPORTER: "Other witnesses.
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Accordingly"...
14
BY MR. RIFFEE:
15
Q. "Accordingly, I reserve the right to amend 11:19:42
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my report and supplement my opinions after
17
considering such evidence, if necessary."
18
Other than the reports that you've already
19
testified about that I understand you've reviewed
20
since you provided this report, is there any other 11:19:54
21
testimony, reports or -- or other information that
22
you reviewed and that you intend to rely on to amend
23
or supplement your report since you issued this on
24
March 4?
25
A. Right now I do not have a current plan to 11:20:12
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amend or supplement my report. I think this is
2
describing possible eventualities in which I would.
3
Q. If you could turn back to Appendix B, at
4
the very end of -- it should be at the very end of
5
your report, still on Exhibit 1. 11:20:41
6
A. I'm there.
7
Q. All right.
8
Is this the complete list of materials
9
that you considered in forming the opinions in your
10
March 4 report in this case? 11:20:51
11
MS. CHAN: Objection. Asked and answered.
12
THE WITNESS: Asked and answered.
13
Yes.
14
BY MR. RIFFEE:
15
Q. Sorry. 11:20:53
16
We weren't looking at it before, but I
17
wanted to make sure that you had a chance to review
18
and confirm that this is actually Appendix B and
19
that this is intended to identify all the -- the
20
materials you considered. 11:21:05
21
And that's -- that's correct; right?
22
A. It is.
23
Q. Okay. Did you put this list together?
24
A. I did.
25
Q. So you identify a number of case filings 11:21:10
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interrogatory responses that you reviewed in this
2
case?
3
A. That was my intent, yes.
4
Q. Do you know if any other interrogatory
5
responses have been provided in this case? 11:22:31
6
A. Not as I sit here, no.
7
Q. Okay. Do you know if any of the class
8
plaintiffs or -- or other plaintiffs in this case
9
have also received and responded to interrogatories?
10
A. I have that understanding, yes. 11:22:54
11
Q. Okay. And have you reviewed any of the
12
interrogatory responses provided by the class
13
plaintiffs or other plaintiffs in this case?
14
A. I have not.
15
Q. In the -- still under case filings, it -- 11:23:14
16
in the middle, you note that you reviewed the
17
declarations of Jennifer Lennon and William M.
18
Martin.
19
Do you see that?
20
A. I see Martin. I'll take your word for it 11:23:28
21
on Lennon because I recall --
22
Q. I think it's just above Martin.
23
A. There it is. Thank you.
24
Q. It's small.
25
A. Yeah. 11:23:40
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exhibits cited here in your report; correct?
2
A. Yes.
3
Q. If you could turn to Paragraph 77.
4
And this is meant to -- I -- I explain how
5
you identified the proposed class members, less the 12:39:21
6
exclusions for the -- the freeze account class;
7
correct?
8
A. Yes.
9
Q. And you also determined that there were --
10
or here, you determined that there were 12:39:36
11
approximately 65,800 card alias IDs in the proposed
12
class freeze. And, again, that's based on
13
interrogatory responses and data provided by the
14
bank; correct?
15
A. Yes. 12:39:58
16
Q. Okay. If you could turn to Paragraph 88,
17
which is on page 40.
18
In the middle of Paragraph 89 -- and this
19
is concerning the customer service class -- it says,
20
"Accordingly, I was asked to assume that the 12:40:28
21
customer service class included the" -- "at minimum,
22
every claim denial and credit rescission class
23
member who submitted a claim based on the claim
24
entry date field between September 13, 2020, and
25
November 21, 2020. Presently, there are around 12:40:43
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15,600 card alias IDs that meet that criterion."
2
And those individuals, the 15,600 card
3
alias IDs that you say meet that criterion, they all
4
submitted a claim during that period, the proposed
5
customer class period, right, based on your review 12:41:05
6
of the data?
7
A. Yes.
8
Q. Okay. Have you undertaken any other
9
efforts to identify additional members of the
10
proposed customer service class period? 12:41:22
11
A. I don't understand your question. Class
12
period --
13
Q. Sure.
14
A. -- it does -- it --
15
Q. Sorry. 12:41:35
16
Have you -- other than identifying these
17
15,600 card alias IDs that meet the criterion
18
because they -- the data indicates they submitted
19
the claim during the proposed customer class --
20
service class period, have you undertaken any other 12:41:50
21
efforts to identify other potential members of the
22
proposed customer service class?
23
A. There -- there were efforts prior -- prior
24
to this time, as the -- the class period was --
25
duration of the class period was identified, though 12:42:17
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should not only be reimbursed the principal amount,
2
but also compensated for the loss of ability to use
3
their funds when a wrongful act was committed by a
4
defendant."
5
Are you offering a legal opinion as to 01:38:37
6
what the plaintiffs or proposed class members are
7
entitled to receive under the law in this case?
8
A. No, I'm not offering a legal opinion. I'm
9
offering economic opinion based upon my
10
understanding of prior actions. 01:38:52
11
Q. Okay. And your economic opinion, based on
12
your understanding, is that one of the things
13
plaintiffs should be reimbursed for is the principal
14
amount.
15
What's your understanding of what 01:39:06
16
principal amount means for the purposes of this
17
case?
18
A. It depends upon the class, though if we
19
use the claim denial class, I would refer to the
20
principal amount as the amount of the claim that was 01:39:20
21
denied.
22
Q. Okay. And for the account freeze class,
23
what would be the principal amount refers -- refer
24
to?
25
A. The account balance that was frozen. 01:39:33
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Q. Is it your opinion that if one of the
2
class plaintiffs or the proposed class members have
3
already been reimbursed or regained access to the
4
full principal amount, that they should give it
5
again as damages in this case? 01:39:48
6
MS. CHAN: Objection. Vague.
7
THE WITNESS: Ultimately, I think there
8
will be an offset, but I think that there's a
9
measurement or an assessment of that amount as the
10
principal amount of damages as I describe it. 01:40:05
11
BY MR. RIFFEE:
12
Q. Okay. Do you -- would you agree that
13
the -- the purpose -- or the goal in calculating
14
economic damages is to measure the difference
15
between the actual outcome for the consumer and the 01:40:22
16
outcome for the consumer in the hypothetical but-for
17
world where the -- the alleged conduct didn't occur?
18
A. Yes.
19
Q. Okay. Do you agree that if a consumer
20
receives or regains access to the full principal 01:40:42
21
amount of the money, the principal amount of money
22
is not a measure of actual economic damages?
23
A. I think that question needs to be more
24
precise because it's not clear when you're
25
attempting to measure that. In this instance, the 01:41:00
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service class considers that element of effort
2
undertaken by cardholders.
3
BY MR. RIFFEE:
4
Q. Okay. You have not attempted to calculate
5
damages based on the time any of the claim denial or 01:45:13
6
credit rescission or EMV chip or account freeze
7
classes spent attempting to get their claims repaid
8
or to regain access to their account, aside from
9
what may be included in the proposed customer
10
service class methodologies; right? 01:45:34
11
A. I -- I understand your que- -- can you
12
explain your question again?
13
Q. Sure.
14
So putting aside the -- the proposed -- or
15
the methodology that's been proposed for the 01:45:50
16
customer service class by Mr. Minnucci with respect
17
to the time that cardholders or -- may have spent on
18
hold, you have not attempted to calculate -- or have
19
you attempted to calculate any damages --
20
consequential damages that cardholders incurred just 01:46:06
21
based on the time that they spent or the steps that
22
they had to take contacting Bank of America or EDD
23
to get their claims reimbursed or their -- to regain
24
access to their accounts?
25
MS. CHAN: Objection. Ambiguous. 01:46:27
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Compound.
2
THE WITNESS: Beyond the level of effort
3
for those members -- proposed members of the
4
customer service class, I have not attempted to
5
measure incremental time incurred by other 01:46:40
6
individuals to have their claim paid by the bank.
7
BY MR. RIFFEE:
8
Q. And why haven't you attempted to do that?
9
MS. CHAN: Objection. Beyond the scope.
10
THE WITNESS: It was my view that the 01:46:55
11
primary harm that the individuals experienced was
12
the lost access to their funds, and so that was the
13
harm that I focused on for purposes of damage
14
measurement.
15
BY MR. RIFFEE: 01:47:18
16
Q. Would you agree that any other harm or
17
potential harm cannot be calculated based on the --
18
the information available to you for the proposed
19
classes?
20
MS. CHAN: Objection. Ambiguous. 01:47:33
21
THE WITNESS: I can't agree to that
22
because I -- I don't -- I haven't set about to try
23
and make that calculation. It -- it may be a
24
possible calculation; I just haven't evaluated it.
25
BY MR. RIFFEE: 01:47:46
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Q. Okay. And you agree that an offset will 01:53:07
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be required for the claim amounts that had been paid
2
to each of these claim denial class members; is that
3
right?
4
MS. CHAN: Objection. Ambiguous. Calls
5
for legal conclusion. 01:53:24
6
THE WITNESS: I have no opinion regarding
7
whether it would be required, but that would be my
8
anticipation.
9
BY MR. RIFFEE:
10
Q. All right. 01:53:44
11
If you could turn to Paragraph 64 of your
12
report with respect to the credit rescission class.
13
So for the credit rescission class in
14
Paragraph 64, did you also attempt to calculate the
15
principal amount of damages based on the claim 01:54:26
16
amount that is a -- claim denial amount that's
17
included in Schedule 1 of your report, the full
18
Schedule 1 of your report?
19
A. Yes.
20
Q. I'm sorry. I meant to refer to Paragraph 01:54:43
21
66 and not 64.
22
And based on the bank's records, you
23
calculated that to be approximately $10.9 million?
24
A. Yes.
25
Q. Do you know whether the bank's records 01:54:59
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16
Do you agree that an offset will be
17
required for the principal amount of damages -- or
18
the principal amount of damages, the account balance
19
these individuals have regained access to that are
20
in the proposed account freeze class? 02:05:21
21
MS. CHAN: Objection. Ambiguous. Calls
22
for a legal conclusion.
23
THE WITNESS: It's the same answer I had a
24
few moments ago: I don't have an opinion on whether
25
it's required, but if the trier of fact implements 02:05:31
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that -- that instruction, then it would be my
2
expectation to do so.
3
BY MR. RIFFEE:
4
Q. Okay. If a cardholder regained access to
5
the full balance of their account at the time of the 02:05:41
6
freeze, they're then in the same place in the actual
7
world as they would have been in the but-for -- for
8
world, at least with respect to the principal
9
amount, the balance of their account, right, because
10
they've regained access to it? 02:06:00
11
MS. CHAN: Objection.
12
THE WITNESS: Subsequent to the time that
13
hypothetical account was unfrozen. The principal
14
amount is identified in the time period during which
15
the account be -- commenced being frozen, until it 02:06:14
16
was unfrozen.
17
BY MR. RIFFEE:
18
Q. Right.
19
So the principal amount in their account,
20
that is not their actual economic damages; 02:06:22
21
your economic -- their -- if they had any actual
22
economic damages, they would be consequential
23
damages that you calculated; correct?
24
MS. CHAN: Objection.
25
THE WITNESS: The -- your question isn't 02:06:36
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precise enough in terms of time. The individual was
2
damaged at the time of frozen because they did not
3
have the funds; instead, the bank had the funds in
4
the account that was frozen. And the consumer did
5
not if or when the account would become unfrozen. 02:06:53
6
And during the time period until the account was
7
unfrozen, that was the principal amount of the
8
damages, and it's used then to measure the
9
consequential harm during that period of time.
10
BY MR. RIFFEE: 02:07:09
11
Q. Right.
12
But then in terms of their actual economic
13
damages after the point which they regained access
14
to their account balance and, by definition, all of
15
these account freeze members had regained access to 02:07:17
16
their -- or regained access to their account
17
balance, the principal amount is not their actual
18
economic damages because they already have that
19
money, it has been returned to them; correct?
20
MS. CHAN: Objection. Ambiguous. 02:07:35
21
THE WITNESS: Effectively, it's
22
confirmatory that the amount was damages during the
23
time period of the freeze, and the bank made a
24
partial payment of a judgment on those damages by
25
unfreezing the account and giving the consumer 02:07:47
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access back to their funds.
2
BY MR. RIFFEE:
3
Q. And what judgment are you referring to?
4
A. The consumer was reawarded the amount of
5
their account balance that had been frozen. 02:07:58
6
Q. After the bank unfroze or unblocked their
7
account; correct?
8
A. Yes.
9
Q. All right.
10
So you've referred to earlier today and in 02:08:14
11
your report the -- the concept of time value of
12
money.
13
Would you agree that it's a common concept
14
in economics and finance?
15
A. I do. 02:08:23
16
Q. All right.
17
And the time value of money, it's meant to
18
reflect the measure -- or reflect and measure the
19
fact that a dollar in hand today is typically worth
20
more than a dollar at some point in the future; is 02:08:38
21
that right?
22
A. Yes.
23
Q. Okay. Would you agree that the time value
24
of money is typically used to measure potential
25
interest earning or investment opportunities for a 02:08:44
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dollar today versus a dollar tomorrow?
2
MS. CHAN: Objection. Vague.
3
THE WITNESS: That's one way in which it's
4
measured.
5
BY MR. RIFFEE: 02:08:55
6
Q. Okay. What are other ways in which you
7
believe the time value of money is measured?
8
A. In -- again, the exercise is to identify
9
the cash flow or asset that's been impacted and
10
assess -- correlate that with an economic event -- 02:09:08
11
here, it's harm -- and identify the implication of
12
that.
13
And in this instance, the consumers were
14
unable to access their funds, and in my view, the
15
consequential harm was a cost of borrowing that the 02:09:22
16
individuals incurred. So a cost of debt is a common
17
way to assess the time value of money.
18
Q. Okay. When assessing the time value of
19
money, what's the typical in- -- interest rate that
20
is applied or considered for the average individual? 02:09:40
21
MS. CHAN: Objection. Ambiguous.
22
THE WITNESS: I don't have enough
23
information --
24
BY MR. RIFFEE:
25
Q. Sure. 02:09:50
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A. -- in the hypothetical.
2
Q. Is there a -- is there an interest rate
3
that would apply to -- to any individual to -- to
4
calculate the -- the time value of money?
5
MS. CHAN: Objection. Ambiguous. 02:10:04
6
THE WITNESS: I'd need to know more about
7
the circumstances.
8
BY MR. RIFFEE:
9
Q. Do you agree that a risk-free interest
10
rate would be applicable as a starting point for -- 02:10:16
11
for every individual, irrespective of their
12
circumstances?
13
MS. CHAN: Objection. Ambiguous.
14
Incom- -- incomplete hypothetical.
15
THE WITNESS: Not without more 02:10:29
16
information.
17
BY MR. RIFFEE:
18
Q. What information would you need to assess
19
to determine what the appropriate interest rate
20
would be for someone's time value of money? 02:10:36
21
A. I'd need to know what circumstances that
22
individual was in for which they're being
23
compensated on a time value of money basis.
24
THE VIDEOGRAPHER: Counsel, I think your
25
microphone is scratching. It may have been touching 02:10:59
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your jacket for a second.
2
MR. RIFFEE: Okay. Sorry. Could have
3
been my pen.
4
BY MR. RIFFEE:
5
Q. What circumstances they were in for 02:11:08
6
assessing the time value of money; what particular
7
circumstances would you need to assess to determine
8
that individual's time value of money calculation
9
or -- or the appropriate interest rate?
10
A. For one, I'd need to know did the person 02:11:22
11
lend the money, did the person borrow the money, for
12
whom and to whom or for what purpose, would be
13
amongst -- when in time the events occurred.
14
Q. Anything else? Any other circumstances
15
that you would need to assess to determine an 02:11:51
16
individual's time value of money?
17
A. Potentially.
18
Q. Potentially.
19
Can you think of any other circumstances
20
beyond whether -- to whom they went the money, 02:12:03
21
whether they borrowed money, when the events
22
occurred?
23
A. Well, those would be the starting points.
24
Q. Okay. Any other points beyond the
25
starting points? 02:12:15
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MS. CHAN: Objection. Asked and answered.
2
THE WITNESS: With that information, I'd
3
then figure out the next steps to take.
4
BY MR. RIFFEE:
5
Q. And what would be the -- the next steps to 02:12:25
6
take?
7
A. Depend upon the answer to -- to the
8
circumstances.
9
Q. Okay. If the individual did not borrow
10
money, what would be the next stape -- next step you 02:12:39
11
would take to determine the time value of money for
12
that particular individual?
13
A. I'd assess other possible events for which
14
the loss of access to funds was relevant.
15
Q. And those are going to vary from person to 02:13:03
16
person; right?
17
MS. CHAN: Objection. Argumentative.
18
THE WITNESS: Not necessarily.
19
BY MR. RIFFEE:
20
Q. Okay. So what other possible events for 02:13:15
21
which loss of access of funds might impact would you
22
consider to determine the time value of money for an
23
individual?
24
A. It could be any number of events. It
25
could be the level of indebtedness that the 02:13:34
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individual was not able to repay. It's -- I -- I'd
2
want to look at the circumstances, much in the same
3
way that I did here.
4
Q. Did you look at the individual
5
circumstances for any proposed class plaintiffs or 02:13:59
6
any proposed class members?
7
A. What I did was to look at the
8
circumstances of the class as a whole, which are
9
California consumers impacted by unemployment
10
insurance in the time frame of 2020 through 2022 02:14:18
11
generally and into 2023.
12
Q. And would you agree that the California
13
consumers impacted by unemployment insurance during
14
that time period, that their individual facts and
15
circumstances will vary from cardholder to 02:14:50
16
cardholder?
17
MS. CHAN: Objection. Vague.
18
THE WITNESS: Which is exactly why looking
19
at the characteristics of the population as a whole
20
allows an estimate -- an appropriate estimate to be 02:15:01
21
taken to ascertain the circumstances of a typical
22
cardholder and the typical circumstances and
23
expected outcomes to measure time value of money.
24
BY MR. RIFFEE:
25
Q. Did you review the circumstances of any 02:15:25
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proposed class members or any class plaintiffs or a
2
sample of such proposed class members or class
3
plaintiffs to assess whether their circumstances
4
were consistent with what you determined to be the
5
likely circumstances for California consumers 02:15:50
6
impacted by unemployment insurance during this
7
period?
8
A. My -- my focus was on the population of
9
consumers and analyzing what the expected impact on
10
the group as a whole would likely have been and how 02:16:05
11
best to measure that. It was my conclusion that
12
looking at an individual plaintiff or named
13
plaintiff would not put me in a position to draw a
14
reasonable extrapolation.
15
Q. All right. 02:16:18
16
So let's go to Exhibit 2, your first class
17
certification report. And I think you -- you
18
testified to this earlier, but I just want to
19
confirm.
20
So if you go to Paragraph 39 of that 02:16:47
21
report, on page 16 -- or, I'm sorry, Paragraph 44,
22
you note that you were using -- or "proposing two
23
alternative methodologies, as described in the
24
subsection below." Methodology 1 starts at
25
Paragraph 45, and then methodology 2 starts at 02:17:22
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as a means to potentially calculate consequential
2
damages in this case; is that right?
3
A. Yes.
4
Q. And you are no longer offering an opinion
5
or attempting to calculate later overdraft fees in 02:20:28
6
this case; is that right?
7
A. Yes.
8
Q. Okay. Why are you no -- why did you
9
decide to no longer include methodology 2 in your
10
affirmative report issued on March 4th? 02:20:41
11
A. I think there were several reasons,
12
including my understanding of the opinions that
13
would be expressed by Ms. East and Mr. Levine and my
14
discussion with counsel regarding my -- their
15
understanding of the tentative ruling in this 02:21:17
16
particular case, calling for more conservative
17
measure of damages as set forth in methodology 1.
18
Q. So you believe that methodology 1 is a
19
conservative measure of damages?
20
A. Yes. 02:21:33
21
Q. All right.
22
If you could turn to Paragraph 46 of
23
Exhibit 1. It's on page 19. Now I'm looking at the
24
wrong report.
25
THE COURT REPORTER: I'm sorry, I didn't 02:22:05
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hear you.
2
MR. RIFFEE: Disregard. I said, "Now I'm
3
looking at the wrong report."
4
BY MR. RIFFEE:
5
Q. All right. 02:22:09
6
I'm sorry. It's Paragraph 44. So you
7
write that you -- you determined the consequential
8
damages amount as a function of the claim denial
9
amount, the time the card -- cardholder could not
10
access the funds, and the applicable interest rate; 02:22:35
11
is that right?
12
A. Yes.
13
Q. And that's the same methodology -- you
14
applied that same methodology for the claim denial,
15
credit recision, and EMV chip classes to assess 02:22:45
16
consequential damages; is that -- is that correct?
17
A. Yes.
18
Q. And then for the applicable interest
19
rates, you used the 10 percent interest rate that
20
you say applied to judgments" -- or you say as it 02:22:55
21
applied to judgments in California and a 20 percent
22
interest rate that you say is consistent with your
23
experience studying unsecured consumer debt; is that
24
right?
25
MS. CHAN: Objection. 02:23:10
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THE WITNESS: That was one basis for
2
selecting a 20 percent APR, to model this scenario.
3
BY MR. RIFFEE:
4
Q. Okay. Let's focus on the claim denial
5
class right now. 02:23:22
6
Did you calculate consequential harm for
7
all the proposed claim denial class members that are
8
included in the Schedule 1 of your report?
9
A. Can you read back the question? I thought
10
there just was something -- 02:23:44
11
Q. Sure.
12
A. -- that didn't sound right to me.
13
Q. Yeah.
14
So was your intent to calculate
15
consequential damages for all the proposed members 02:23:50
16
of the claim denial class that are included in
17
Schedule 1 of your report?
18
A. Yes.
19
Q. Okay. And did you do that regardless of
20
how many days it took for the -- their claim to be 02:24:00
21
paid or repaid?
22
A. Yes.
23
Q. So even if Schedule 1 of your report
24
reflects that the total number of claim denial days
25
was ten or less, you still calculated consequential 02:24:16
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instead of the -- the claim amount; right?
2
A. Yes, with respect to the principal
3
amounts. Yes.
4
Q. Okay. And the consequential damages
5
amounts; right? 02:33:19
6
A. Well, for the account freeze class, I have
7
the cost of a delayed benefit payment as well, which
8
is what I was distinguishing in my last answer.
9
Q. Fair enough.
10
For the cost of inability of access to 02:33:30
11
frozen funds, and not the cost of delayed benefits
12
payments, it's the same calculation as you applied
13
for the claim denial amount, except that you're
14
doing it based on the -- a function of the account
15
balance, as opposed to the unauthorized transaction 02:33:50
16
claim amount; right?
17
A. True.
18
Q. Okay. Thank you.
19
Let's go ahead and take a -- actually,
20
if -- are you good to continue? 02:34:12
21
A. Okay.
22
Q. All right.
23
So we'll go to Paragraph 46. And at the
24
bottom of the page, you note that the first interest
25
rate, 10 percent, is consistent with the interest 02:34:35
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rate applied to judgements in California.
2
And what's the -- the basis for your
3
understanding that that's an interest rate that's
4
applied to judgments in California?
5
A. My familiar- -- familiarity with the 02:34:46
6
California Civil Code, my practicing in this area
7
for more than 20 years, and quite a number of jury
8
instructions that that's how this calculation is
9
employed.
10
Q. Do you intend to offer a legal opinion in 02:35:06
11
this case as to whether or not a 10 percent
12
California judgement rate is the appropriate rate to
13
be used here or that would apply to a claim brought
14
under EFTA?
15
A. No. I don't intend to offer any legal 02:35:20
16
opinions.
17
Q. At the top of page 20, still in Paragraph
18
46, you write that, "The 10 percent rate likely
19
understates the cost a consumer would have incurred
20
during that same period, including the cost of 02:35:37
21
increased borrowing, reduced consumption or the
22
inability to pay down existing debt, such as a
23
credit card" -- or "such as credit card debt."
24
How would a borrowing rate be a measure of
25
economic -- economic damages resulting from a 02:36:00
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BY MR. RIFFEE:
2
Q. Is it your opinion that a 20 percent APR
3
is a reasonable measure to measure a cost that an
4
individual incurs by reducing consumption?
5
MS. CHAN: Objection. Outside scope. 02:37:46
6
THE WITNESS: On that topic, I'm relying
7
upon the expertise of Ms. East and Mr. Levine.
8
BY MR. RIFFEE:
9
Q. Is it your opinion that an individual who
10
reduces consumption purely to reduce consumption of 02:38:04
11
nonessentials -- Netflix subscriptions, gym
12
memberships, things like that -- that that -- that a
13
20 percent APR interest rate is an appropriate
14
measure of consequential damages for the reduction
15
and consumption of -- of nonessential expenditures? 02:38:29
16
MS. CHAN: Objection. Assumes facts.
17
Argumentative. Outside the scope.
18
THE WITNESS: Based upon my analysis of
19
the circumstances of the class members and my
20
assessment of the harm incurred by the population of 02:38:47
21
impacted class members, as well as my understanding
22
of Ms. East and Mr. Levine's opinions, the -- this
23
would be a reasonable and conservative measure of
24
the harm incurred by those consumers.
25
BY MR. RIFFEE: 02:39:13
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Q. So a consumer who had a claim of $50
2
denied by the claim fraud filter and, as a result,
3
decided to -- to drop their online streaming
4
subscriptions, your opinion would be that 20 percent
5
APR is an appropriate measure of their consequential 02:39:27
6
damages?
7
MS. CHAN: Objection. Assumes facts.
8
Incomplete --
9
BY MR. RIFFEE:
10
Q. Is that your interpretation of -- sorry -- 02:39:31
11
Ms. Levine's -- or Mr. Levine's and Ms. East's
12
opinions?
13
MS. CHAN: Objection. Assumes facts.
14
Incomplete hypothetical. Outside scope.
15
THE WITNESS: Based upon my own analysis 02:39:44
16
of the circumstances of the class, as -- as well as
17
Ms. East, Mr. Levine's analysis of the circumstances
18
of the class as a whole, this is an appropriately
19
conservative and appropriate measure -- measurement
20
of the harm incurred by typical class members. 02:40:06
21
BY MR. RIFFEE:
22
Q. Even class members who reduced
23
their consumption simply to avoid nonessentials --
24
THE COURT REPORTER: Sorry, your
25
microphone is -- 02:40:15
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beginning of Media Unit 4. We are going back on the
2
record. The time is 3:00 p.m.
3
BY MR. RIFFEE:
4
Q. All right. Thank you. Welcome back
5
again. 03:00:56
6
If you could turn back to your report,
7
Exhibit 1, Paragraph 47, which is on page 20.
8
A. I'm there.
9
Q. Already there. Perfect.
10
In this paragraph you state, "I determined 03:01:06
11
the second interest rate based on my review of the
12
types of credit excessed" -- or "accessed by typical
13
consumers. Credit cards are the most widely used
14
form of consumer credit. As a result, I concluded
15
that the most likely sort of funds accessible to an 03:01:22
16
impact cardholder would have been increased credit
17
card utilization until the time the bank credited
18
their accounts for the claim."
19
So your -- this is -- this is the -- the
20
basis for the -- the 20 percent, the second interest 03:01:35
21
rate that you used to calculate consequential
22
damages in this case?
23
A. Yes.
24
Q. Okay. And did you select this rate
25
yourself or were you instructed to -- to use this 03:01:47
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rate by -- by counsel?
2
A. I selected this rate.
3
Q. Okay. And, again, you said -- you
4
concluded that this -- or you stated, "This is based
5
on my review of the types of credit accessed by 03:02:00
6
typical consumers" and that "the most likely source
7
of accessible funds was credit card utilization."
8
So this rate is meant to equate the -- the
9
interest rate or the APR applicable to credit cards;
10
right? 03:02:19
11
A. Yes, an -- an estimate of the cost of
12
borrowing the consumers incurred.
13
Q. Okay. And it's -- it's not meant to
14
equate to -- or to calculate the cost of reduced
15
consumption? 03:02:35
16
MS. CHAN: Objection.
17
THE WITNESS: It's not a direct
18
measurement of the cost of reduced consumption, but
19
it's a proxy for it based upon my understanding of
20
Ms. East and Mr. Levine's analyses. 03:02:53
21
BY MR. RIFFEE:
22
Q. Did you do anything to verify their
23
analysis which you believe would lead them to
24
conclude that a 20 percent APR is consistent also
25
with the reduction in consumption? 03:03:09
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A. Yes, because their analysis, in my view,
2
was consistent with -- with mine. Different studies
3
were -- were considered in terms of developing their
4
opinions, but my findings regarding the conditions
5
applicable to population of impacted cardholders 03:03:27
6
yielded similar results to their analyses.
7
Q. Okay. But your -- your analysis here and
8
your assumption here is based on the fact -- or your
9
belief that the most likely source of funds that was
10
used were -- was credit cards with a 20 percent APR; 03:03:44
11
right?
12
A. That the best estimate of the -- the costs
13
that consumers incurred is represented by the cost
14
of borrowing on a credit card, yes.
15
Q. Even if they never had a credit card, you 03:03:58
16
think the best estimate for a proposed class member
17
is still a 20 percent APR, based on the -- the
18
average available credit card interest rate at the
19
time?
20
MS. CHAN: Objection. 03:04:13
21
THE WITNESS: When I consider the
22
class-wide impact, in my view, that's the best
23
estimate or best way to estimate the cost of
24
borrowing incurred by the impacted cardholders.
25
BY MR. RIFFEE: 03:04:28
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BY MR. RIFFEE:
2
Q. Did you review that data or information
3
for any of the proposed class members?
4
MS. CHAN: Objection. Ambiguous.
5
THE WITNESS: What data? 03:08:25
6
BY MR. RIFFEE:
7
Q. The date at which their deposits occurred
8
or the individuals' biweekly payment from EDD -- did
9
you review that information for any of the proposed
10
class members? 03:08:39
11
A. Earlier today I described the efforts that
12
are underway to get information regarding the EDD
13
biweekly deposit information, which would have both
14
of those attributes, I would expect. But the
15
existing data available to me doesn't allow me to 03:08:53
16
conduct that analysis.
17
Q. In footnote 46 of your report, which
18
actually turns back to page 19, you write, "I
19
understand the selection of the appropriate interest
20
rate is ultimately an issue for the trier of fact to 03:09:13
21
determine."
22
Is it your opinion that 20 percent -- a
23
20 percent APR is the correct interest rate to apply
24
here to calculate consequential damages for the
25
proposed claim denial, credit rescission, account 03:09:28
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freeze, and EMV chip classes, or are you deferring
2
that to the -- to the trier of fact?
3
MS. CHAN: Objection.
4
THE WITNESS: It's slightly more
5
complicated than that. I will opine that this is a 03:09:43
6
reasonable way in which to determine an -- a rate
7
that would apply to this particular proposed class.
8
Ultimately, I think the trier of fact is going to
9
make a determination, and included in that
10
determination will be an assessment of Ms. East's 03:10:01
11
proposed interest rate, Mr. Levine's proposed
12
interest rate, and, I'm sure, evidence that the bank
13
will put on as well.
14
BY MR. RIFFEE:
15
Q. Okay. But is it your opinion that a 03:10:12
16
20 percent -- is the opinion you intend to offer in
17
your report and in this case that the 20 percent
18
APR -- that you believe that's the more appropriate
19
interest rate that should be used to calculate
20
consequential damages in this case, as opposed to 03:10:26
21
the 10 percent rate that you suggested in the other
22
alternative?
23
A. I haven't formed an opinion on which is
24
more appropriate. I think either can be used to
25
measure the impact. One is more conservative. 03:10:43
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My -- the overall purpose of my report was
2
to present a methodology to calculate damages and
3
consequential damages, and it's my understanding
4
that Ms. East's or Mr. Levine's proposed rates would
5
be used in the construct of my methodology. 03:11:04
6
Q. All right.
7
Back to Paragraph 47, at the second --
8
third sentence: "As a result, I concluded the most
9
likely source of funds accessible to an impacted
10
cardholder would have been increased credit card 03:11:28
11
utilization."
12
You say "most likely." You don't intend
13
to offer an opinion regarding whether any proposed
14
class member actually increased their credit card
15
utilization in this case, do you? 03:11:45
16
A. I don't intend to identify specific
17
cardholders that did, no.
18
Q. Okay. You just believe it was likely
19
based on the -- the sources cited in your report?
20
A. Correct. 03:11:55
21
Q. All right.
22
MR. RIFFEE: I'm going to introduce as
23
Exhibit 6 to your deposition, a document that I'm
24
handing to you now.
25
(Regan Deposition Exhibit 6 was marked for 03:12:10
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identification.)
2
BY MR. RIFFEE:
3
Q. Do you recognize this document?
4
A. Yes.
5
Q. Okay. I've handed you a document that's 03:12:29
6
titled "Credit Card Spending and Borrowing Since the
7
Start of the COVID-19 Pandemic," authored by Joanna
8
Stavins.
9
Is this a document that you have reviewed
10
before? 03:12:45
11
A. Yes.
12
Q. Is this a document that you cited in your
13
report and that you believe supports your opinions
14
that the most likely source of funds accessible to
15
an impacted cardholder would've been increased 03:12:54
16
credit card utilization?
17
A. This is one source of data that I
18
considered, yes.
19
Q. Okay. Do you see at the very beginning of
20
Ms. Stavins' report, on the first -- bottom of the 03:13:06
21
first page, she writes, "With the onset of the
22
COVID-19 pandemic in the United States in the spring
23
of 2020, consumers drastically reduced their
24
spending, including spending on credit cards. Both
25
current credit card spending and revolving unpaid 03:13:22
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balances carried over from previous billing periods
2
declined steeply."
3
And then it says, "Starting in the second
4
quarter of 2021, credit card spending increased
5
again." 03:13:36
6
Is this -- is that a statement that you've
7
seen before?
8
A. Yes.
9
Q. Okay. And did you consider the fact that
10
credit card spending was reported to have decreased 03:13:45
11
significantly the first year of the pandemic -- did
12
that at all factor into your opinion that the most
13
likely source of borrowing by the proposed class
14
members was on credit cards?
15
A. Yes, I did consider that. 03:13:59
16
Q. Okay. And then your opinion is that the
17
most likely source of borrowing by these proposed
18
class members was on credit cards, even though it's
19
been reported here and -- and in other sources
20
cited -- cited in your report that credit card 03:14:16
21
spending actually decreased for the first year of
22
the pandemic, when many of these proposed
23
cardholders were without funds?
24
A. Yes. I considered it in a variety of
25
ways. 03:14:28
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Q. Okay. How did you consider it?
2
A. Well, amongst other things, this is an
3
analysis of -- of all consumers. It's not targeted
4
to the consumers at issue in the class -- proposed
5
class. So you can't necessarily read into overall 03:14:39
6
trends when we're dealing with a specific subset of
7
consumers, including those that the bank's own
8
representatives describe as the most vulnerable of
9
all of their customers. So that's what you should
10
be looking at. 03:14:56
11
Second, as we see in the next paragraph,
12
that credit card spending increased again in the
13
second quarter of 2021, when a lot of the claims
14
activity at issue was present in our particular
15
proposed class. So that's -- strikes me as being 03:15:10
16
right on -- right on point to being -- using this as
17
a reasonable measurement.
18
And third, this indicates that during the
19
period of time in 2020, consumers were using
20
available funds to be able to reduce their credit 03:15:26
21
card revolving unpaid balances. So that's
22
consistent with avoiding the cost of interest,
23
similar to what I've measured. And consumers were
24
not able to do that when their funds were withheld
25
from them. 03:15:44
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Q. Okay. Did you review any of the proposed
2
class members' credit card balances -- revolving
3
balances to determine whether they, in fact, had
4
revolving balances at the time they were without
5
access to their funds? 03:15:59
6
A. I did not attempt to do an individual
7
analysis because I did not have data that would
8
allow me to make a reasonable extrapolation. So I
9
studied the characteristics of the population of
10
proposed class members and looked at the 03:16:09
11
information, including the studies and data that I
12
highlighted in Paragraphs 40 to 43 of Exhibit 1, in
13
reaching my conclusion that the cost of borrowing
14
was the most appropriate way to measure
15
consequential harm. And the most common way in 03:16:32
16
which consumers were borrowing during this period of
17
time was on a credit card, and I used a median
18
applicable credit card rate, all of which struck me
19
as an appropriate methodology to measure damages.
20
Q. And you also did not review any of the 03:16:56
21
proposed class members' credit card balances or --
22
or statements to determine whether they, in fact,
23
actually relied on a credit card or used credit
24
cards to cover any funds that they may not have been
25
able to access during this period; right? 03:17:13
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A. I did not review individual credit card
2
statement balances.
3
Q. And each of these studies -- none of them
4
are specific -- that you relied on in your report
5
and cited in your report, none of them are specific 03:17:24
6
to this particular set of proposed class members;
7
correct?
8
MS. CHAN: Objection. Ambiguous.
9
THE WITNESS: Actually, I think that, for
10
example, the Department of Labor study of 03:17:33
11
unemployment benefit recipients in California in
12
which -- I think it was 97 percent of consumers
13
surveyed said that those benefits were important to
14
be able to meet their then-current financial needs.
15
I think there was a CFPB study I cited reaching 03:17:53
16
similar conclusions, along with the bank's testimony
17
that these were vulnerable people that were
18
withdrawing their funds upon receipt. And that's
19
consistent with, for example, the study from the
20
Federal Reserve cited in Paragraph 42 of my report, 03:18:12
21
that the consequence of not having those funds
22
available was incurring costs of borrowing.
23
So those studies, I think, were targeted.
24
They were aligned with the specific class of people
25
that I'm trying to measure damages for. 03:18:29
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BY MR. RIFFEE:
2
Q. But you didn't take any steps to -- to
3
verify that those studies were, in fact, consistent
4
with what these proposed class members actually did;
5
correct? 03:18:43
6
MS. CHAN: Objection.
7
THE WITNESS: Given the -- the size of the
8
classes, including claim denial, I think it's --
9
it's well over a hundred thousand people. It was my
10
conclusion that studying the data about that type of 03:18:57
11
consumer at that moment in time would lead me to be
12
able to provide the best measurement of the type of
13
harm and the quantum of that harm experienced in
14
that period of time.
15
BY MR. RIFFEE: 03:19:13
16
Q. Did you review any data or evidence
17
regarding the proposed class members to assess their
18
actual income levels or credit histories at the time
19
they were without access to the funds in their
20
account? 03:19:39
21
A. No. What I did was to focus on things
22
such as median income levels and typical recipients
23
of EDD benefits during this period of time to get a
24
sense of the overall class characteristics, rather
25
than look at the -- the individuals for whom did not 03:19:58
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have sufficient data to -- to do the extrapolation
2
I've described.
3
Q. Okay. So you -- you don't know if my
4
particular cardholder in the proposed claim denial,
5
credit rescission, EMV chip or account freeze 03:20:16
6
classes actually increased their credit card
7
utilization or borrowed during the time that they
8
were unable to access funds, either their claim
9
amount or their account balance; right?
10
MS. CHAN: Objection. Misstates 03:20:29
11
testimony.
12
THE WITNESS: I understand that certain of
13
the class reps or individual plaintiffs did use
14
credit-card-related spending, but I did not -- did
15
not analyze that to reach my conclusions regarding 03:20:41
16
the harm suffered by the class as a whole.
17
BY MR. RIFFEE:
18
Q. What's the basis for your understanding
19
that certain class reps or plaintiffs actually used
20
their credit card? What -- what information did you 03:20:52
21
review or evidence did you review to form that
22
understanding?
23
A. My understanding was from counsel, that
24
individuals testified or described in discovery
25
responses the use of credit cards. I think 03:21:06
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Mr. Stango addresses certain class members that --
2
that did so.
3
Q. So it's based on your conversation with
4
counsel and your subsequent review of Mr. Stango's
5
report? 03:21:21
6
A. Correct. Because I had concluded that I
7
was not likely to extrapolate from a select number
8
of individuals to the class as a whole, but rather
9
study characteristics of the class.
10
Q. But you didn't review any individual 03:21:32
11
plaintiff or any proposed class member or any class
12
plaintiff or proposed class representative
13
plaintiff's discovery responses or deposition
14
testimony or any other documents or evidence they
15
produced prior to issuing this March 4 report; 03:21:47
16
right?
17
MS. CHAN: Objection. Asked and answered.
18
THE WITNESS: I'm not aware of -- aware of
19
evidence to indicate that the -- either the class
20
reps or named plaintiffs were selected because they 03:21:59
21
were representative of -- of the whole class. And
22
absent that information, I don't have a basis, nor
23
is that group of a size that would allow me to
24
reasonably extrapolate, on the contrary, a very
25
large class for which data can be analyzed and 03:22:16
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ascertained.
2
BY MR. RIFFEE:
3
Q. Well, that wasn't my -- my question is
4
simply, did you review any documents produced by the
5
class plaintiffs, as you identify them in 03:22:33
6
Paragraph 1 of your report, or any other proposed
7
class members or any other individual plaintiffs in
8
this case or their discovery responses or their
9
testimony prior to issuing this March 4th report?
10
A. For all the reasons I've given you in my 03:22:47
11
prior answers, I chose not to take that pathway
12
because I felt that other alternatives would result
13
in a better estimation of the type of harm
14
experienced by proposed class members.
15
Q. All right. 03:23:04
16
MR. RIFFEE: Let's mark Tab 27 as
17
Exhibit 7.
18
(Regan Deposition Exhibit 7 was marked for
19
identification.)
20
MR. RIFFEE: Thank you. 03:23:28
21
BY MR. RIFFEE:
22
Q. I'm handing you a document which has been
23
marked as Exhibit 7.
24
MS. LAMPO: Mm-hmm.
25
BY MR. RIFFEE: 03:23:35
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BY MR. RIFFEE: 03:27:48
21
Q. Okay. Do you know whether -- are you
22
aware that each of the other class plaintiffs that
23
you identified in Paragraph 1 of your report, and
24
other individual plaintiffs -- are -- are you aware
25
that they were asked the same interrogatory, or 03:27:59
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pro- -- they -- the same interrogatory was
2
propounded to them?
3
A. I'm not aware of the discovery process
4
that went back and forth.
5
Q. Because you didn't review any of the 03:28:09
6
interrogatory responses or any other discovery
7
concerning any of the individual class plaintiffs or
8
any of the other individual plaintiffs in this case;
9
correct?
10
MS. CHAN: Objection. 03:28:22
11
THE WITNESS: I focused my analysis on my
12
assessment of California consumers, on unemployment
13
insurance benefits during the time period in which
14
the claim denials and other wrongful actions are
15
alleged to have occurred. 03:28:36
16
BY MR. RIFFEE:
17
Q. Is it your opinion that the class
18
representatives that plaintiffs' counsel have
19
proposed that they believe are representative of the
20
class, that their actual experience is not an 03:28:46
21
important consideration or -- or check on your
22
analysis to assess whether your consequential harm
23
methodologies are consistent with the -- the classes
24
that they're purporting to represent?
25
MS. CHAN: Objection. 03:29:03
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THE WITNESS: I don't have an assessment
2
or whether it's important or not. I understand that
3
the class reps were not chosen to be representative
4
of the types of damages that consumers were
5
experiencing, which is why I've studied the 03:29:14
6
population of proposed class members much in the
7
same way that Ms. East and Mr. Levine have.
8
BY MR. RIFFEE:
9
Q. If you had a sample -- or if you have a
10
sample here of available set of proposed class 03:29:25
11
representatives and class members who have provided
12
discovery, do you think -- would it not impact your
13
opinion if you were to review their discovery
14
responses, their documents, and those discovery
15
responses and documents indicated that the majority 03:29:42
16
of them did not incur borrowing costs or interest
17
rates at the 20 percent APR that you've used to
18
calculate consequential damages?
19
MS. CHAN: Objection. Ambiguous. Assumes
20
facts. Incomplete hypothetical. 03:29:57
21
THE WITNESS: I'd have to look at the
22
responses to see how those responses indicated some
23
level of harm, and what the magnitude of harm would
24
be, and whether or not the cost of borrowing was a
25
reasonable representation of that level of harm. 03:30:15
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BY MR. RIFFEE:
2
Q. You haven't done that to date; right?
3
A. I understand that's a small population of
4
people, and I don't have a reasonable basis to think
5
that their circumstances are representative of the 03:30:31
6
class as a whole, which is much larger.
7
Q. Do you know if any particular cardholder
8
in plaintiffs' proposed classes even had a credit
9
card during the period when they were without access
10
to the claim amount or the funds in their account? 03:30:53
11
A. It's my understanding -- I think we just
12
went through this a few moments ago -- from -- from
13
counsel as well as from looking at Mr. Stango's
14
report that certain of the individuals did -- did
15
have credit cards during the time period. 03:31:10
16
Q. Are you aware that other individual
17
plaintiffs and certain class member -- or
18
class representatives testified that they did not
19
have a --
20
THE COURT REPORTER: Counsel, slowly. 03:31:18
21
MR. RIFFEE: I'm sorry.
22
BY MR. RIFFEE:
23
Q. Are you aware that other individual
24
plaintiffs or class plaintiffs testified that they
25
did not have a credit card during the pandemic or 03:31:27
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during the period when they were without access
2
to -- to certain funds?
3
MS. CHAN: Objection. Asked and answered.
4
THE WITNESS: I -- I am aware of that.
5
And my analysis doesn't necessitate that every 03:31:37
6
single class member had a credit card. My
7
assessment is that credit card borrowing was the
8
most common form of borrowing during the period of
9
time, and the cost of borrowing on a credit card is
10
an appropriate approximation of the consequential 03:31:53
11
harm experienced by class members.
12
BY MR. RIFFEE:
13
Q. Okay. But when your methodology is
14
calculating consequential damages for each proposed
15
class member, your methodology is necessarily 03:32:04
16
assuming that each of them incurred the same
17
interest rate of 20 percent APR, as if they had a
18
credit card; correct?
19
MS. CHAN: Objection.
20
THE WITNESS: It's assuming that 03:32:14
21
20 percent cost of borrowing is a median cost, which
22
necessarily understates the typical average cost,
23
because a mean, for example, would incorporate the
24
impact of outliers that borrowed on -- on payday
25
loans or other factors that we can observe in the 03:32:32
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economy.
2
So it doesn't -- my analysis doesn't
3
necessitate, again, that everyone had a credit card.
4
My analysis looks to the most common form of
5
borrowing. I think the data in several of these 03:32:43
6
reports indicate that over 75 percent of Americans
7
have credit cards, so it's very common form of
8
borrowing, and it represents a reasonable
9
approximation.
10
I selected 20 percent. I think we can see 03:33:00
11
that different types of consumers have higher rates.
12
I observed that Ms. Levine came to a very similar
13
answer -- Mr. Levine as well -- excuse me -- Mr. --
14
Ms. East and Mr. Levine came to very similar
15
answers. 03:33:21
16
BY MR. RIFFEE:
17
Q. Okay. Did you assess whether or not
18
75 percent of the -- or do you know the percentage
19
of the proposed class members who actually had and
20
utilized credit cards during this period? 03:33:31
21
A. I don't have that specific data point.
22
I'm relying upon data for large groups of consumers
23
indicating that con- -- credit cards were commonly
24
used. I think I cited some of the studies.
25
Q. And you said 20 percent APR is meant to be 03:33:48
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a mean, an estimate. So a mean necessarily means
2
that there are a -- many proposed class members who
3
would have had borrowing costs or interest rates
4
below the 20 percent APR; correct?
5
MS. CHAN: Objection. 03:34:05
6
THE WITNESS: I said it -- I said it was a
7
median, actually.
8
There were other outcomes that would have
9
been more expensive than the use of a credit card
10
rate, is what I was saying. 03:34:17
11
BY MR. RIFFEE:
12
Q. And there would also be outcomes that were
13
less expensive than the use of a credit card rate
14
too; correct?
15
A. Yes. And the median captures that. 03:34:23
16
Q. So you'd agree that when you're con- -- or
17
calculating consequential damages in Schedule 1 for
18
each of these proposed class members, your
19
calculations would provide consequential damages to
20
some number of individuals below that median who 03:34:39
21
actually had less or significantly less
22
consequential damage as a result of the point when
23
they were -- or during the period when they were
24
without access to the funds?
25
MS. CHAN: Objection. 03:34:56
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THE WITNESS: I don't know that any would
2
be significantly less. I think it's an appropriate
3
estimation to calculate class-wide damages in the
4
aggregate, and it's typical of a median -- median
5
class member on that basis. 03:35:14
6
BY MR. RIFFEE:
7
Q. And your belief -- are you offering a
8
legal opinion as to whether or not it's appropriate
9
to calculate class-wide damages in the aggregate --
10
aggregate? 03:35:28
11
A. No. I'm offering an economic opinion.
12
Q. All right.
13
If you go Paragraph 42 in your report, it
14
says that one of the bases for your consequential
15
harm opinion in your opinion that proposed members 03:35:45
16
had to turn to credit cards to cover --
17
THE COURT REPORTER: Counsel, if you can
18
slow down, please.
19
MR. RIFFEE: Sure.
20
BY MR. RIFFEE: 03:35:49
21
Q. Is your -- your opinion that proposed
22
class members had to turn to credit cards to cover
23
your expenses if your belief that the loss of this
24
replacement income was particularly impactful
25
because consumers who lost their job during the 03:36:00
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Q. Again, you have not reviewed any data for
10
these proposed class members showing what their wage 03:39:34
11
actually was prior to becoming unemployed, or what
12
their available savings or checking account or
13
alternative -- alternative income sources were at
14
the time they were without their funds; correct?
15
MS. CHAN: Objection. Asked and answered. 03:39:53
16
THE WITNESS: I have not reviewed specific
17
information for individual plaintiffs, but rather
18
I'm looking at the population of impacted
19
cardholders and gathering data to indicate what
20
their circumstances were in the moment that the harm 03:40:07
21
was incurred.
22
BY MR. RIFFEE:
23
Q. Okay. Do you agree that each of the
24
proposed class member's fact and circumstances would
25
be different? 03:40:18
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level prior to becoming unemployed regarding,
2
whether or not they had other credit card account,
3
regarding whether or not they had other checking or
4
savings accounts -- would it surprise you if that
5
information was not provided to Bank of America 03:48:11
6
as -- by EDD or as part of their participation in
7
the EDD program?
8
A. I don't know what information the bank
9
had.
10
Q. Okay. Do your consequential harm 03:48:21
11
methodologies and your proposed interest rates for
12
calculating consequential harm consider the
13
expansion of other COVID-era benefits that were
14
available to proposed class members and just
15
individuals as a whole? 03:48:41
16
MS. CHAN: Objection. Vague.
17
THE WITNESS: My analyses consider the
18
circumstances of the pandemic, the time frame at
19
which proposed class members experienced a harm. So
20
during that time period, I'm aware that there were 03:48:57
21
enhanced benefits, but, again, I'm looking to tailor
22
the analysis to the specific circumstances of the
23
proposed class members, including the information
24
we've gone through for a few minutes now that's laid
25
out in Paragraphs 40 to 43 of my report. 03:49:18
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BY MR. RIFFEE: 04:10:27
21
Q. Do you know if this plaintiff was deposed?
22
A. I do not.
23
Q. Okay. Did you review the deposition
24
testimony of any of the individual plaintiffs or
25
class representatives to assess whether or not they 04:10:35
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were actually harmed or had to pay any interest
2
whatsoever while they were without funds in their
3
accounts, or claims?
4
MS. CHAN: Objection. Asked and answered.
5
THE WITNESS: No, I did not. 04:10:46
6
MR. RIFFEE: All right. Let's go off the
7
record and take break.
8
THE VIDEOGRAPHER: Okay. This marks the
9
end of Media Unit 4. We are going off the record.
10
The time is 4:10 p.m. 04:11:00
11
(Short recess taken.)
12
THE VIDEOGRAPHER: This marks the
13
beginning of Media Unit 5. We are going back on the
14
record. The time is 4:26 p.m.
15
BY MR. RIFFEE: 04:26:52
16
Q. Thank you. Welcome back again.
17
A. Thank you.
18
Q. So your consequential harm -- or
19
consequential damages methodology, it assumes that
20
every proposed class member in the claim denial, 04:27:02
21
credit rescission, account freeze or EMV chip
22
classes borrowed at a -- or -- or was harmed in an
23
amount that equates to a 10 or 20 percent interest
24
rate for the full amount -- applied to the full
25
amount of their claim for their account balance; 04:27:23
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A. Approximately 10 to 15 days, something
2
like that.
3
Q. You think their credit card payment after
4
a bill is issued -- that they have 10 to 15 days to
5
submit a payment, on average? 04:36:40
6
A. I have to look -- I have to look at the
7
typical term, but I -- somewhere in that order of
8
magnitude. Maybe up -- 20-something days.
9
Q. Would you agree that if a consumer's
10
without access to -- to funds for a week, they may 04:36:54
11
choose to use a credit card as a substitute for
12
their funds, they would be able to make a credit
13
card payment as they ordinarily would when it came
14
due at the end of their billing cycle, once they
15
regained those funds, within a week? 04:37:15
16
MS. CHAN: Objection. Incomplete
17
hypothetical.
18
THE WITNESS: I'm sorry, can you say --
19
BY MR. RIFFEE:
20
Q. Yeah. 04:37:33
21
Would you -- from a -- from an economist's
22
perspective, if an individual was without funds for
23
one week and they choose to use a credit card in
24
that one week, not knowing if they were going to get
25
the funds get, then all of a sudden they get the 04:37:44
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funds back a week later, the but-for cause of any
2
interest that they may incur is not -- would not be
3
the fact they didn't have funds for a week, because
4
they would have had the funds in time to pay off
5
that credit card by the time the statement became 04:37:57
6
due?
7
MS. CHAN: Objection. Incomplete
8
hypothetical.
9
THE WITNESS: To the extent that the
10
consumer's balance wasn't revolving, that would 04:38:07
11
be -- that could be the case.
12
But my analysis doesn't assert that a
13
credit card was used in every transaction. It's
14
assuming that the most common form of borrowing was
15
on a credit card, and the cost of borrowing in that 04:38:21
16
situation was 20 percent.
17
BY MR. RIFFEE:
18
Q. Okay. But your analysis does assert that
19
every individual, even if they had -- were without
20
funds in their account for 30 days or less -- 04:38:34
21
without accounts for 2 weeks or less -- or funds in
22
their account for 2 weeks or less, less than a
23
typical credit card billing cycle, that your
24
methodology would calculate the but-for
25
consequential damages to be the 2-week period when 04:38:51
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they were without funds in their account; is that
2
correct?
3
A. Yes, because the consumer was harmed when
4
the bank withheld their funds during that period of
5
time. They might have borrowed on a credit card. 04:39:06
6
They might have reduced consumption or foregone some
7
other element that they did not choose to have to
8
encumber as a result of the harm that was incurred.
9
And I think that Dr. -- Ms. -- Ms. East
10
and Mr. Levine measure harm similarly. They -- they 04:39:20
11
indicate that the cost would be higher in those
12
particular circumstances.
13
So I think that the measurement of harm
14
during that period of time is -- is consistent with
15
doing so at 20 percent. 04:39:33
16
Q. But the methodology that you propose in
17
your report and that you use to calculate
18
consequential damages for each of the classes, other
19
than the customer service class, assumes that each
20
borrowed at a 20 percent interest rate; correct? 04:39:45
21
MS. CHAN: Objection.
22
THE WITNESS: As a way of measuring the
23
harm. There are other ways in which the harm could
24
have been incurred that were even more expensive,
25
based upon my analysis of Ms. -- Ms. East and 04:39:58
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Mr. Levine's analysis.
2
BY MR. RIFFEE:
3
Q. But the only way that you measure harm in
4
your methodology in your report is based on the
5
20 percent interest rate, which you equate to a 04:40:08
6
credit card -- or credit card utilization; correct?
7
MS. CHAN: Objection.
8
THE WITNESS: I measure it in that way as
9
an analog for the types of harm the consumers were
10
experiencing during the time of a claim denial, for 04:40:21
11
example.
12
BY MR. RIFFEE:
13
Q. Is it your opinion that every proposed
14
class member in the claim denial, credit rescission,
15
EMV chip classes -- that if they had a claim that 04:41:01
16
was denied for less than 30 days, that they could
17
not have paid off and that they incurred interest
18
charges because of that 30-day period when they were
19
without funds -- 30-day or less period when they
20
were without funds? 04:41:21
21
A. I've said this repeatedly: It doesn't
22
necessitate that they incurred credit-card-related
23
interest. It is a measurement of the harm incurred
24
by a class member during this period of time, using
25
the most common form of borrowing. 04:41:38
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There are other costs incurred that we've
2
discussed. If a consumer had to forego buying
3
groceries for a week or had to delay a medical
4
procedure, there -- there are costs attendant to
5
that, that this measurement can be used to quantify 04:41:59
6
the harm experienced by the consumer. And in that
7
regard, I'm relying upon the analysis of Ms. --
8
Ms. East and Mr. Levine.
9
Q. So you believe that your methodology is
10
also proposing the costs of -- of -- or your 04:42:14
11
consequential damages also calculate medical
12
expenses?
13
MS. CHAN: Objection. Misstates
14
testimony.
15
THE WITNESS: This is a conservative 04:42:20
16
measurement because those other types of instances
17
are associated with greater rates of harm. And so
18
this median credit card rate of interest
19
appropriately captures class-wide damages on an
20
aggregate basis. 04:42:40
21
MR. RIFFEE: All right.
22
Let's mark as Exhibit 10, Tab 13.
23
THE COURT REPORTER: 13?
24
MR. RIFFEE: Yes.
25
(Regan Deposition Exhibit 10 was marked 04:42:54
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So I would not say it's duplicative.
2
Q. So in the scenario where the claim denial,
3
credit rescission, and EMV chip classes were all
4
able to recover damages, would you agree that in
5
that scenario, the principal amount damages that you 06:34:50
6
calculated for the claim denial and credit
7
rescission classes would be duplicative of the EMV
8
chip principal amount damages and would need to be
9
de-duplicated?
10
MS. CHAN: Objection. 06:35:10
11
THE WITNESS: In the scenario that I think
12
you're conveying, yes. And that's why I describe
13
it, my approach, in that way.
14
BY MR. RIFFEE:
15
Q. Because it's based on the same claims that 06:35:19
16
are the subject of the principal amount for the
17
claim denial and credit recission classes; right?
18
A. Same claim but different alleged harm.
19
Q. Same principal amount balance based on the
20
claim amount, but different alleged harm; correct? 06:35:30
21
A. That's my understanding.
22
Q. So you're not proposing that if the claim
23
denial and EMV chip class members were able to
24
recover damages, they would be able to receive the
25
principal amount of their damages twice based on 06:35:43
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both their claim denial and EMV chip class --
2
A. I am not -- not make --
3
THE COURT REPORTER: Wait. Can you finish
4
the question, please?
5
MR. RIFFEE: We've done pretty good not 06:35:54
6
doing that today.
7
THE WITNESS: He -- he paused.
8
You done?
9
MR. RIFFEE: I was done.
10
THE COURT REPORTER: I didn't get the rest 06:36:07
11
of the question.
12
MR. RIFFEE: Classes, I think, was the
13
rest of the question. But I'll just restate it.
14
BY MR. RIFFEE:
15
Q. So I just want to confirm: You're not 06:36:11
16
com- -- proposing that if the claim denial and EMV
17
chip classes were both able to recover damages, that
18
they would receive the principal amount of their
19
damages twice, based on the denial of their claim;
20
correct? You would offset so you recovered once? 06:36:26
21
A. That's correct. If both classes or some
22
combination of two classes were awarded.
23
Q. And the same would be the case for the
24
credit rescission proposed class and the EMV chip
25
class; is that right? 06:36:40
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A. That's correct.
2
Q. Are there any other proposed class damages
3
that your methodology would calculate damages that
4
you think would need be disaggregated or
5
de-duplicated if multiple proposed classes were 06:36:53
6
awarded damages?
7
A. The -- the ones that come to mind I'd
8
have -- I'd have to look at are in the claim denial
9
class. If one card alias ID has multiple claims
10
that are overlapping in the same period, then need 06:37:17
11
to look at the interest accumulation periods to make
12
sure they're not over- -- if they're overlapping.
13
Q. Have you attempted to do that, sitting
14
here today, or does your Schedule 1 of your report
15
attempt to do that de-duplication of consequential 06:37:34
16
damages or interest award for a person who had
17
multiple claims?
18
A. I have -- all the data is in Schedule 1 to
19
do it. I haven't carried out the calculation until
20
an award is made, because I'd need to understand the 06:37:51
21
terms of an award.
22
Q. So, for example, in the table under
23
Paragraph 50 of your report for the claim denial
24
class, where you calculate the cost of inability to
25
access UI funds, that number does not reflect 06:38:14
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HIGHLY CONFIDENTIAL
CERTIFICATE OF REPORTER
I, Hanna Kim, a Certified Shorthand
Reporter, do hereby certify:
That prior to being examined, the witness
in the foregoing proceedings was by me duly sworn to
testify to the truth, the whole truth, and nothing
but the truth;
That said proceedings were taken before me
at the time and place therein set forth and were
taken down by me in shorthand and thereafter
transcribed into typewriting under my direction and
supervision;
I further certify that I am neither
counsel for, nor related to, any party to said
proceedings, not in anywise interested in the
outcome thereof.
Further, that if the foregoing pertains to
the original transcript of a deposition in a federal
case, before completion of the proceedings, review
of the transcript [X] was [] was not requested.
In witness whereof, I have hereunto
subscribed my name.
Dated:
June 4, 2025.
fl
Hanna Kim, CLR, CSR No. 13083
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Case 3:21-md-02992-GPC-MSB Document 591-26 Filed 10/17/25 PageID.41362
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