[Code of Federal Regulations]
[Title 12, Volume 3]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 12CFR229.21]

[Page 535-536]
 
                       TITLE 12--BANKS AND BANKING
 
                   CHAPTER II--FEDERAL RESERVE SYSTEM
 
PART 229--AVAILABILITY OF FUNDS AND COLLECTION OF CHECKS (REGULATION CC)--Table of Contents
 
 Subpart B--Availability of Funds and Disclosure of Funds Availability 
                                Policies
 
Sec. 229.21  Civil liability.

    (a) Civil liability. A bank that fails to comply with any 
requirement imposed under subpart B, and in connection therewith, 
subpart A, of this part or any provision of state law that supersedes 
any provision of subpart B, and in connection therewith, subpart A, with 
respect to any person is liable to that person in an amount equal to the 
sum of--
    (1) Any actual damage sustained by that person as a result of the 
failure;
    (2) Such additional amount as the court may allow, except that--
    (i) In the case of an individual action, liability under this 
paragraph shall not be less than $100 nor greater than $1,000; and
    (ii) In the case of a class action--
    (A) No minimum recovery shall be applicable to each member of the 
class; and
    (B) The total recovery under this paragraph in any class action or 
series of class actions arising out of the same failure to comply by the 
same depositary bank shall not be more than the lesser of $500,000 or 1 
percent of the net worth of the bank involved; and
    (3) In the case of a successful action to enforce the foregoing 
liability, the costs of the action, together with a reasonable 
attorney's fee as determined by the court.
    (b) Class action awards. In determining the amount of any award in 
any class action, the court shall consider, among other relevant 
factors--
    (1) The amount of any damages awarded;
    (2) The frequency and persistence of failures of compliance;
    (3) The resources of the bank;
    (4) The number of persons adversely affected; and
    (5) The extent to which the failure of compliance was intentional.
    (c) Bona fide errors--(1) General rule. A bank is not liable in any 
action brought under this section for a violation of this subpart if the 
bank demonstrates by a preponderance of the evidence that the violation 
was not intentional and resulted from a bona fide error, notwithstanding 
the maintenance of procedures reasonably adapted to avoid any such 
error.
    (2) Examples. Examples of a bona fide error include clerical, 
calculation, computer malfunction and programming, and printing errors, 
except that an error of legal judgment with respect to the bank's 
obligation under this subpart is not a bona fide error.
    (d) Jurisdiction. Any action under this section may be brought in 
any United States district court or in any other court of competent 
jurisdiction, and shall be brought within one year after the date of the 
occurrence of the violation involved.
    (e) Reliance on Board rulings. No provision of this subpart imposing 
any liability shall apply to any act done or omitted in good faith in 
conformity with any rule, regulation, or interpretation thereof by the 
Board, regardless of whether such rule, regulation, or interpretation is 
amended, rescinded, or determined by judicial or other authority to be 
invalid for any reason after the act or omission has occurred.
    (f) Exclusions. This section does not apply to claims that arise 
under subpart C of this part or to actions for wrongful dishonor.
    (g) Record retention. (1) A bank shall retain evidence of compliance 
with the requirements imposed by this subpart for not less than two 
years. Records may be stored by use of microfiche, microfilm, magnetic 
tape, or other methods capable of accurately retaining and reproducing 
information.
    (2) If a bank has actual notice that it is being investigated, or is 
subject to an enforcement proceeding by an agency charged with 
monitoring that bank's compliance with the Act and this subpart, or has 
been served with

[[Page 536]]

notice of an action filed under this section, it shall retain the 
records pertaining to the action or proceeding pending final disposition 
of the matter, unless an earlier time is allowed by order of the agency 
or court.