A proposed class action claims Bank of America, N.A.; U.S. Bank National Association; and KeyCorp wrongfully refused to honor bonds issued by predecessors Rainier Bank and Seattle-First National Bank. According to the lawsuit, the four named plaintiffs were told by the defendants that their bonds were “worthless” despite the institutions being fully aware that they were obligated to pay the instruments as part of their acquisitions of Rainier and Seattle-First in the 1980s.
The case explains that the plaintiffs and proposed class members are owners of bank bonds, bills, certificates, time deposits, certificates of deposit (CDs) and multiple maturity non-negotiable time certificates of deposit issued by Rainier and Seattle-First. Sometime after the instruments were issued, Rainier was acquired by all three defendants and Seattle-First was acquired by Bank of America, the suit says.
Although the defendants were required as part of the acquisitions to honor the plaintiffs’ bonds, the four individuals were allegedly told upon attempting to redeem the instruments either that the funds had been “sent to unclaimed property” or that the bank was not responsible for paying the bonds. Both excuses were false, according to the case, as the banks never escheated the funds to the state of Washington and had inherited from their predecessors an obligation to pay the instruments.
The case notes that Bank of America, in particular, has been sued “at least four times” for its alleged failure to honor Rainier National Bank bonds, with one court ordering the bank to pay the beneficiary of the bond at issue.
This lawsuit looks to cover the following proposed class:
All individuals who acquired a bank bond, bill, certificate, time deposit, CD, and multiple maturity non-negotiable time certificate of deposit (“Bond”) from Seattle-First or Rainer Bank where the following conditions are met: (i) the Bond automatically renews unless redeemed or a notice of nonrenewal is provided by the issuer under the terms of the Bond; (ii) the owner or legal beneficiary has not redeemed the Bond; and (iii) the owner or legal beneficiary received no notification that the Bond was not being renewed, was abandoned, and/or had escheated to the State of Washington.