## Facts

- A plumbing and heating company employed an IT contractor who later became its comptroller and received access to the company’s computer systems and bank-account information.
- The comptroller allegedly initiated unauthorized ACH debits from the company’s bank accounts to pay down his personal credit-card balance at the same bank.
- The company claimed only its principals were authorized to direct ACH payments and that the comptroller’s access was limited to monitoring accounts.
- The alleged unauthorized transfers began in 2008, continued after the comptroller’s termination, and were discovered months later.
- The company sued, asserting (among other claims) that the bank, as the originating depository financial institution (ODFI), breached NACHA-related authorization warranties and acted negligently by processing the debits.

## Issues

1. Whether a commercial account holder whose account was debited is an intended third-party beneficiary who may sue an ODFI directly for breach of NACHA operating-rule warranties.
2. Whether the pleadings stated a Pennsylvania negligence claim against the ODFI for failing to prevent or detect unauthorized ACH debits initiated by the customer’s employee.
3. Whether the UCC Article 4A/NACHA framework displaces or limits common-law claims that would impose duties beyond the ACH allocation of rights and remedies.

## Decision

- The court granted the bank’s Rule 12(b)(6) motion and dismissed the NACHA-based breach-of-warranty claim.
- The court held the plaintiffs were not intended third-party beneficiaries of NACHA interbank warranties; any benefit to account holders was incidental.
- The court dismissed the negligence claim for failure to plead a cognizable duty owed by the ODFI to the debited account holder in this setting.
- The challenged counts against the bank were dismissed; the case continued as to other defendants and claims.

## Legal Principles

- NACHA operating rules function as contracts among participating financial institutions; ODFI warranties run to other network participants (e.g., RDFIs and operators), not to customers absent clear intent to confer enforceable rights.
- Under Pennsylvania third-party beneficiary doctrine, incidental benefits from an interbank contractual framework do not confer standing to sue for breach.
- Negligence requires a legally recognized duty; in ACH disputes governed by UCC Article 4A and NACHA rules, courts are reluctant to impose extra-contractual duties on banks that would alter the scheme’s risk allocation.
- Where a comprehensive statutory/contractual regime governs electronic funds transfers, common-law theories that effectively add remedies or obligations inconsistent with that regime may be unavailable.

## Conclusion

The court dismissed claims against the bank because NACHA authorization warranties were enforceable only within the ACH interbank framework and the plaintiffs failed to plead an independent common-law duty supporting negligence for employee-initiated unauthorized ACH debits.


Clinton Plumbing & Heating of Trenton, Inc. v. Ciaccio, No. 09-2751, 2010 WL 4224473 (E.D. Pa. Oct. 22, 2010)