## Facts

- Andrew Gale used a Hyde Park Bank debit card for a purchase in December 2001.
- The transaction was not debited from Gale’s checking account until April 2002, and the late posting allegedly caused an overdraft.
- Gale alleged the bank failed to make the electronic fund transfer in a “timely manner” under 15 U.S.C. § 1693h(a)(1).
- Gale also alleged the bank failed to provide required information and conduct an appropriate investigation under 15 U.S.C. § 1693f.
- The bank contended the delay was attributable to the merchant or interbank network and that it posted the charge within about 48 hours of receiving it.
- The district court dismissed under Rule 12(b)(6), reasoning the bank acted promptly once the transaction arrived and that the merchant/network caused the delay.
- Gale appealed.

## Issues

1. Whether dismissal under Rule 12(b)(6) was improper because the district court resolved contested facts and drew inferences against the plaintiff by crediting the bank’s explanation for the delay.
2. Whether the district court improperly relied on emails attached to the complaint as proof of the bank’s factual narrative without converting the motion to one for summary judgment.
3. Whether “timely manner” in 15 U.S.C. § 1693h(a)(1) could be treated as satisfied as a matter of law based on a claimed 48-hour posting period, despite disputed facts about when the bank received the transaction.

## Decision

- The Seventh Circuit vacated the dismissal and remanded for further proceedings.
- The court held the district court erred by adopting the bank’s version of when the transaction reached the bank and who caused the delay, rather than accepting Gale’s allegations and reasonable inferences in his favor.
- The court ruled that attaching the bank’s emails to the complaint did not concede the truth of the bank’s statements.
- If the district court wished to treat the emails as determinative evidence, it was required to convert the motion to summary judgment and follow the procedures for that posture.
- The court declined to resolve, on the pleadings, the meaning of “timely” under the EFTA or responsibility allocation among bank, merchant, and network.

## Legal Principles

- On a Rule 12(b)(6) motion, a court must accept the plaintiff’s factual allegations as true and may not resolve factual disputes or draw inferences against the plaintiff.
- A plaintiff’s attachment of an opposing party’s communications to a complaint does not, by itself, make the statements binding admissions of their truth.
- When a court relies on matters outside the pleadings (or treats attached materials as establishing disputed facts) to decide a Rule 12(b)(6) motion, it must convert the motion to summary judgment and provide appropriate procedural protections.
- The EFTA’s “timely manner” requirement in 15 U.S.C. § 1693h(a)(1) is not defined by the statute or regulations in a way that permits fact-bound disputes to be resolved at the pleading stage.

## Conclusion

The Seventh Circuit held that the complaint could not be dismissed by accepting the bank’s explanation for the delayed debit-card posting and treating attached emails as dispositive; contested timing and causation questions, and any resulting EFTA liability, had to be addressed through summary judgment or trial.


Gale v. Hyde Park Bank, 384 F.3d 451 (7th Cir. 2004)