Michael Sliwa v. Sezzle, Inc.

I. BACKGROUND

Sezzle is a service that allows consumers to pay for purchases at a later date. Dkt. 1-2 (Compl.). ¶ 3. It is a “point-of-sale-loan” application. Id. ¶ 16. Sezzle “touts itself as a free service” and allows consumers to pay for purchases in installments with no interest. Id. ¶¶ 17, 21. If, however, a user is unable to pay for an installment, Case 2:22-cv-06093-DSF-MAA Document Filed 11/07/ Page 2 of Page ID #:401

Sezzle will cancel the account. Users must pay a ten-dollar reactivation fee to make a new purchase. Dkt. 29-1 (Lucas Decl.) ¶ 5. Sezzle warns users that if it is not able to process a payment, a fee will be added to the payment after a grace period. Compl. ¶ 24. Sezzle does not, however, warn that automatic installment charges may result in users incurring overdraft and insufficient funds fees (NSF fees) from their banks. Compl. ¶¶ 25-26. When a payment does not go through, Sezzle will sometimes try to re-process payments, which results in multiple NSF fees for users. Id. ¶ 32. For example, Sliwa made a purchase using Sezzle in December 2021. Over the next month, his bank charged him four separate $34 NSF fees for Sezzle’s…