LOS ANGELES (Legal Newsline) - Your problems with scammers are not our fault, Walmart is telling a woman who filed a class action lawsuit against it over security measures.
The plaintiff, Risa Potters, is 73 years old and says she was directed by a scammer posing as a police officer to make deposits into Cash App accounts using barcodes supposedly linked to a court's bond account.
She says Walmart, which offers customers a way to deposit paper money into their Cash App accounts, facilitated these transfers without raising any red flags or informing her about the nature of these transactions.
Walmart filed a motion to dismiss on Feb. 23 in Los Angeles federal court, stating it sympathizes with the victims of fraud but Potters' theory of liability is wrong.
"Plaintiff does not allege he Walmart has any connection to the fraudster or the scam, nor does she allege that Walmart induced her to part with her money," the motion says.
"Instead she claims that Walmart is responsible because Walmart followed her instructions and processed her Cash App deposits as she request... Plaintiff's claims in this case - all premised on the notion that Walmart should have done more to protect her from the third party fraudster - are meritless and should be dismissed."
As to whether Walmart breached the implied covenant of good faith and fair dealing, it points out that there is no contract between the two parties that could have been breached. It also rejected her allegations of violation of several California consumer protection laws.
"Plaintiff is not a 'consumer' under the (California Legal Remedies Act) because she did not purchase a tangible good or service from Walmart," it says. "Her CLRA claim also rests on the assertion that Cash App deposits are an illegal' 'financial product,' a theory that has zero support in law."
The plaintiff alleges that Walmart and Cash App have been knowingly facilitating fraudulent financial transactions for years, exploiting the elderly and vulnerable individuals. Despite being subject to FTC orders and government investigations, the defendants have allegedly continued to ignore glaring flaws in their anti-fraud measures.
Walmart rejects this notion, saying it has beefed up its security protocol.
Sean Berkowitz of Latham & Watkins represents Walmart, while attorneys from Strange LLP represent the plaintiff.