OPINION AND ORDER Patrice Chambers, on behalf of herself and all persons similarly situated, brings this action against HSBC Bank USA, N.A. alleging that HSBC improperly imposes fees for transactions involving insufficient funds in client accounts. In her complaint, Chambers asserts claims for breach of contract, breach of the covenant of good faith and fair dealing, unjust enrichment, and a violation of New York General Business Law §349. Pending before the Court is HSBC’s motion to dismiss the complaint in its entirety and with prejudice. See Doc. 18. For the reasons set forth below, HSBC’s motion to dismiss the complaint is GRANTED in part and DENIED in part. I. BACKGROUND A. Factual Background Chambers has a consumer checking account with HSBC. Her relationship with HSBC is governed by a written agreement titled “Rules for Consumer Deposit Accounts” (the “Rules”) and a written addendum titled “Terms & Charges Disclosure” (the “Disclosures”). Compl. Exs. B, A, respectively. According to these documents, if a customer does not have enough money in their account to cover a transaction, HSBC may pay the overdraft and charge the associated Insufficient Funds (“NSF”) fee. Compl. Ex. B at 3-4. The Disclosures provide that: “[f]or each withdrawal, check, electronic funds transfer or other item that overdraws your account,” HSBC will charge an NSF fee of $35. See Compl. Ex. A at 2 (emphasis added). The Rules define the term “item” as follows: An “item” includes checks, substitute checks, remotely created checks, withdrawal slips or other in-person transfers or withdrawals, service charges, electronic items or transactions, including withdrawals made from an Automated Teller Machine, everyday or recurring debit card transactions, pre-authorized payments or transfers, ACH transactions,1 telephone initiated transfers, online banking transfers or bill payment instructions, and any other instruments or instructions for the payment, transfer or withdrawal of funds including an image or photocopy of any of these. Compl. Ex. B at 3-4 (emphasis added). Chambers alleges that she authorized a payment to Santander Bank on May 17, 2019. Compl. 14. HSBC returned this payment because Chambers had insufficient funds in her account. Id. 15. Chambers was charged an NSF fee in connection with this transaction, which she concedes was an appropriate charge under the Rules and Disclosures. Id. On May 29, 2019, twelve days later, the payment Chambers initiated on May 17 was presented a second time to HSBC by Santander. Id. 16. The transaction was again returned to due to insufficient funds in Plaintiff’s account and she was again charged an NSF fee for the transaction. Id. Chambers also authorized a payment to Geico on June 21, 2019. Id. 19. This payment was returned due to insufficient funds and she was assessed an NSF fee, which she again concedes was appropriate. Id. 20. Six days later, on June 27, 2019, the payment was again presented by Geico to HSBC Bank. Id. 21. It was also returned due to insufficient funds, resulting in another NSF fee. Id. Chambers alleges that the second NSF fee assessed in connection with the Santander Bank and Geico transactions was improper. B. Procedural History On November 8, 2019, Chambers brought suit against HSBC, asserting claims for breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, and a violation of GBL §349. Doc. 1. On March 6, 2020, HSBC filed the instant motion to dismiss Chambers’ complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). Doc. 18. II. MOTION TO DISMISS THE COMPLAINT A. Legal Standard “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is facially plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556). The plaintiff must allege sufficient facts to show “more than a sheer possibility that a defendant has acted unlawfully.” Id. (citing Twombly, 550 U.S. at 556). However, this “flexible ‘plausibility standard’” is not a heightened pleading standard, In re Elevator Antitrust Litig., 502 F.3d 47, 50 n.3 (2d Cir. 2007) (quotation marks and citation omitted), and “a complaint…does not need detailed factual allegations” to survive a motion to dismiss, Twombly, 550 U.S. at 555. The question on a motion to dismiss “is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims.” Sikhs for Justice v. Nath, 893 F. Supp. 2d 598, 615 (S.D.N.Y. 2012) (quoting Villager Pond, Inc. v. Town of Darien, 56 F.3d 375, 378 (2d Cir. 1995)). “[T]he purpose of Federal Rule of Civil Procedure 12(b)(6) is to test, in a streamlined fashion, the formal sufficiency of the plaintiff’s statement of a claim for relief without resolving a contest regarding its substantive merits” or “weigh[ing] the evidence that might be offered to support it.” Halebian v. Berry, 644 F.3d 122, 130 (2d Cir. 2011) (internal quotation marks and citations omitted). Accordingly, when ruling on a motion to dismiss pursuant to Rule 12(b)(6), the Court accepts all factual allegations in the complaint as true and draws all reasonable inferences in the plaintiff’s favor. Nielsen v. Rabin, 746 F.3d 58, 62 (2d Cir. 2014); see also Twombly, 550 U.S. at 556 (“[A] well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable….”). However, the Court is not required to credit “mere conclusory statements” or “threadbare recitals of the elements of a cause of action.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 555). “For purposes of this rule, the complaint is deemed to include any written instrument attached to it as an exhibit or any statements or documents incorporated in it by reference.” Chambers v. Time Warner, Inc., 282 F.3d 147, 152 (2d Cir. 2002) (internal quotation marks and citations omitted). B. Analysis 1. Plaintiff Has Stated a Claim for Breach of Contract At the motion to dismiss stage, a breach of contract claim may be dismissed if a contract unambiguously authorizes the defendant’s alleged conduct. See MS Fed. Acquisition, LLC v. U.S. Bank Nat’l Ass’n, No. 14 Civ. 7794 (LTS), 2015 WL 4461740, at *3 (S.D.N.Y. July 21, 2015). If a material contractual term is ambiguous, however, dismissal is inappropriate because all contractual ambiguities must be resolved in favor of the plaintiff at this stage. See Subaru Distribs. Corp. v. Subaru of Am., Inc., 425 F.3d 119, 122 (2d Cir. 2005). To assess whether contractual language is ambiguous under New York law, courts in this Circuit examine whether the language “could suggest more than one meaning when viewed objectively by a reasonably intelligent person.” Law Debenture Trust Co. of N.Y. v. Maverick Tube Corp., 595 F.3d 458, 466 (2d Cir. 2010) (internal quotation marks omitted). Such person would be “cognizant of the customs, practices, usages and terminology as generally understood in the particular trade or business.” Id. (internal citation and quotation marks omitted). Here, Plaintiff and Defendant dispute whether HSBC’s conduct was authorized under the Rules and Disclosures because they disagree on the meaning of the term “item.” Plaintiff argues that each iteration of an attempted transaction is not a new “item” each time it is returned for insufficient funds and reprocessed, especially when Plaintiff took no action to resubmit it. Compl. 26. Further, Plaintiff argues that the term “item” has a well-understood industry meaning of referring to payments that follow an accountholder’s affirmative instruction for payment, as opposed to a merchant’s attempt to collect on that payment. Plaintiff’s Opposition to Defendant’s Motion to Dismiss, Doc. 26 at 7-8. Therefore, Plaintiff asserts that the term “item,” when viewed objectively by a reasonably intelligent person, would encompass all iterations of the same payment. In support, Plaintiff also notes that many of HSBC’s peer banks only assess one overdraft fee per attempted payment: For example, JP Morgan Chase explicitly states in its disclosures that it will charge a maximum of one NSF fee on an item if it is returned multiple times within a 30-day period. Doc. 26 at 7. Similarly, other banks that do employ multiple fee practices expressly disclose that they will assess more than one NSF fee on a single item. See Compl.
