Wells Fargo seeks to compel arbitrations – USA TODAY

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File photo taken in 2016 shows the Wells Fargo sign outside a bank branch in Miami, Florida. Reports indicate that more than 5,000 Wells Fargo employees have been fired as a result of a scandal involving employees that secretly set up new fake bank and credit card accounts in order to meet sales targets. (Photo by Joe Raedle/Getty Images) ORG XMIT: 668246071 ORIG FILE ID: 601081902(Photo: Joe Raedle, Getty Images)

Wells Fargo (WFC) has asked a federal court to dismiss a lawsuit filed by scores of customers over the bank’s unauthorized accounts scandal and compel them to resolve the disputes in private arbitration.

The San Francisco-based banking giant’s motion, filed in Utah as the Thanksgiving holiday neared, is aimed at the first putative class-action lawsuit filed after Wells agreed to pay $ 185 million in penalties and $ 5 million in customer reimbursement for opening as many as 2 million accounts without customers’ authorization. The bank also moved to dismiss the case.

Wells Fargo reached the settlement in September with the federal Consumer Financial Protection Bureau, the U.S. Comptroller of the Currency and city and county of Los Angeles. The agreement has sparked customer anger, as well as congressional and legal investigations of the banking giant.

Wells Fargo’s latest court motion is aimed at what it characterized as an “unwieldy” case that features 80 customer-plaintiffs and 17 legal causes of action against the bank.

“Plaintiffs agreed to arbitrate any disputes with Wells Fargo, including the claims they assert in this lawsuit,” the bank argued in a motion and legal memorandum. “Plaintiffs are judicially estopped from arguing otherwise, as a party ‘cannot rely on the contract, when it works to their advantage, and repudiate it when it works to their disadvantage.’”

The customers’ court complaint argued that Wells Fargo outpaced its competitors in the relative number of accounts opened per-customer by pressuring bankers and managers to meet escalating sales goals.

“Wells Fargo’s managers and bankers have for years engaged in unethical, and illegal practices called ‘gaming,’” the Utah court complaint argued. “Gaming consists of, among other things, opening and manipulating fee generating customer accounts through often unfair, fraudulent, and unlawful means, such as omitting signatures and adding unwanted secondary accounts to primary accounts without permission. Other practices utilized as part of these ‘gaming’ schemes have included misrepresenting the costs, benefits, fees, and/or attendant services that come with an account or product, all in order to meet sales quotas.”

In support of its legal argument for arbitration, Wells Fargo cited a September 2015 ruling in which a California federal court judge granted the bank’s motion to compel arbitration in a case filed by customers who also accused the bank of opening accounts without permission. U.S. District Court Judge Vince Chhabria dismissed that case in a ruling the customers appealed to the U.S. Circuit Court of Appeals for the Ninth Circuit.

However, court records show the California case was reopened, and joined with a similar lawsuit filed there, following this year’s Wells Fargo settlement.

Follow USA TODAY reporter Kevin McCoy on Twitter: @kmccoynyc

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