16.  Plaintiffs bring this action on behalf of themselves and all others similarly  situated pursuant to Fed. R. Civ. P. 23. This action satisfies the numerosity,  commonality, typicality, adequacy, predominance and superiority requirements of  Rule 23.   18.  Plaintiffs reserve the right to modify or amend the definition of the proposed  Class before the Court determines whether certification is appropriate.   19.  Excluded  from  the  Class  is  Flagstar Bank,  its  parents,  subsidiaries,  affiliates, officers and directors, any entity in which Flagstar Bank has a  controlling interest, all customers who make a timely election to be excluded,  governmental entities, and all judges assigned to hear any aspect of this litigation,  as well as their immediate family members.   20.  The members of the Class are so numerous that joinder is impractical. The  Class consists of thousands of members, the identity of whom is within the  knowledge of and can be ascertained only by resort to Flagstar Bank’s records.   22.  There are numerous questions of law and fact common to the Class and  those common questions predominate over any questions affecting only individual  Class members.   24.  Other questions of law and fact common to the Class include:  a.  The proper method or methods by which to measure damages,  and   b.  The declaratory relief to which the Class is entitled.   26.  Plaintiffs  are  committed  to  the  vigorous  prosecution  of  this  action  and   have retained competent counsel experienced in the prosecution of class actions.   27.  A class action is superior to other available methods for the fair and efficient  adjudication of this controversy.  Since the amount of each individual Class  member’s claim is small relative to the complexity of the litigation, and due to the  financial resources of Flagstar Bank, no Class member could afford to seek legal  redress individually for the claims alleged herein.  Therefore, absent a class action,  the Class members will continue to suffer losses and Flagstar Bank’s misconduct  will proceed without remedy.   29.  Flagstar Bank is in the business of providing its customers with a variety of  banking services.  One of the services provided by Flagstar Bank for customers  who open a checking account is the ability to make electronic withdrawal  transactions. For example, a customer has the ability, through an electronic check,  to pay a bill online through funds in the customer’s Flagstar Bank checking  account. As a result, Flagstar Bank is notified instantaneously when the transaction  is processed, and has the option to accept or decline transactions at such time.   30.  Based upon information and belief, Flagstar Bank employs sophisticated  software to automate its overdraft system. This program maximizes the number of  overdrafts, and thus, the amount of overdraft fees charged per customer.   32.  Plaintiffs and all members of the Class maintain or maintained a checking  account with Flagstar Bank. The  terms  of  Flagstar Bank’s checking  accounts   are contained in standardized account holder agreements, presented to its  customers on a “take it or leave it” basis, drafted and imposed by Flagstar Bank,  which was the party of vastly superior bargaining strength, and thus constitute  agreements of adhesion. A representative copy of the “Terms and Conditions and  Disclosure Guide” (the “Deposit Agreement”), covering customers maintaining  accounts in Michigan, which is 37 pages long, single-spaced and in small font, is  attached as Exhibit B.   33.  The Deposit Agreement states that (“We process checks and similar items  second–in the order in which they are received for the business day on which they  are processed.” (p. 9, emphasis added).   35.  In an effort to maximize overdraft revenue, Flagstar Bank manipulates and  reorders debit transactions from highest to lowest during given periods of time.   Flagstar Bank’s reorders transactions for no reason other than to increase the  number of exorbitant overdraft fees it can charge. This practice violates numerous  consumer protection laws and the covenant of good faith and fair dealing in the  Flagstar Bank Deposit Agreement.   36.  In addition, Flagstar Bank misleads its customers regarding its reordering  practices.  Instead of unequivocally telling its customers that it will reorder debits  from highest to lowest, the Bank states in its contract that they process checks in  the order in which they are received for the business day on which they are  processed. This  statement  is deceptive  and/or  unfair  because  it  is,  in  fact,   Flagstar Bank’s practice  to  always reorder  debits  from highest to lowest.  Flagstar Bank’s practices thus violate the covenant of good faith and fair dealing  implied in the Bank Deposit Agreement as well as the consumer protection laws of  Michigan.   38.  Notwithstanding the instantaneous nature of these electronic debit  transactions, under Flagstar Bank’s posting system, it fails to post charges in the  order in which they are assessed or received. Flagstar Bank developed a policy and  employs a practice whereby account charges and debits are posted to its customers’  accounts out of chronological order for the sole purpose of maximizing the number  of overdraft transactions and, therefore, the amount of overdraft fees charged to its  customers.   39.  Instead of processing such transactions in chronological order, Flagstar Bank  processes them starting with the largest debit and ending with the smallest debit, so  as to generate the largest possible number of overdrafts and the greatest possible  amount of overdraft fees.     41.  Flagstar Bank’s policy and practice of posting charges from largest to  smallest, rather than chronologically, or from smallest to largest, is specifically  designed to maximize the generation of overdraft fees by triggering overdraft fees  for account charges that would not otherwise result in such fees.   42.  Flagstar Bank enforces an unconscionable policy whereby charges assessed  are posted to customers’ accounts in a non-chronological order, from highest to  lowest, and are held  for  multiple  days  and  then  batched  together,  to  maximize   the  number  of  overdraft transactions  and fees. Flagstar Bank’s processing  practices substantially increase the likelihood that customers’ smaller charges will  result in multiple overdraft fees.  The practices provide Flagstar Bank with  substantially higher service fee revenues than it would otherwise achieve absent  these practices.   44.  Flagstar Bank actively  promotes  the  convenience of  its electronic   debiting,  but  fails  to  provide  customers  with  accurate  balance  information.  When customers execute account transactions, they generally do not have access to  an accurate balance register or balance information.   45.  Flagstar Bank provides inaccurate balance information to its customers  through its electronic network. In certain cases, Flagstar Bank informs its  customers that they have a positive balance when, in reality, they have a negative  balance, despite the Bank’s actual knowledge of outstanding debits and  transactions.   46.  Even when Flagstar Bank has actual knowledge of outstanding transactions  which  have  already  created  a  negative  balance  in  a  customer’s  account,  it   encourages  the customer  to  incur  more  overdraft  charges  by  approving— rather  than  prudently  declining— subsequent debit card purchases and other  electronic transactions.    48.  At the time its electronic checks are used, Flagstar Bank is able to determine,  almost instantaneously, whether there are sufficient funds in a customer’s account  to cover that particular transaction. The  Bank  has  the  technological capability to  decline transactions (which it does when a pending transaction would exceed a pre-  determined, overdraft tolerance limit for the account), or notify customers at that  very moment that  the  particular  debit transaction  would  result  in  an  overdraft.  Flagstar Bank could give  customers  the  option  to  decline  the  transaction  to   avoid  incurring  the  overdraft  fee,  but  it does  not  do  so  because  it  seeks  to   maximize  the  amount  of  revenue  generated  through  its assessment of overdraft  fees.   50.  Flagstar Bank fails to make Plaintiffs and Class members aware that they  can opt out of its overdraft scheme upon request, thereby avoiding any overdraft  fees from being charged.  F.  Flagstar Bank’s Overdraft Policies and Practices Are Contrary to Best  Practices   51.  By engaging in the conduct described herein, Flagstar Bank has failed to  follow the list of “best practices” for overdraft programs set forth in the “Joint  Guidance on Overdraft Protection Programs” (“Joint Guidance”) issued by the  United States Department of the Treasury, the Office of the Comptroller of the  Currency, the Board of Governors of the Federal Reserve System, the Federal  Deposit Insurance Corporation, and the National Credit Union Administration  (collectively, the “Agencies”). A copy of the Joint Guidance is attached as Exhibit  C. These “best practice” recommendations include: “Provide election or opt-out of  service.  Obtain affirmative consent of consumers to receive overdraft protection.   Alternatively, where overdraft protection is automatically provided, permit  consumers to ‘opt-out’ of the overdraft program and provide a clear consumer  disclosure of this option.”   70 F.R. 9127-01,  9132.   53.  The Joint Guidance also advises banks to “[a]lert customers before a  transaction triggers any fees. When consumers attempt to withdraw or transfer  funds made available through an overdraft protection program, provide a specific  consumer notice, where feasible, that completing the withdrawal may trigger the  overdraft fees.” 70 F.R.D. 9127, 9132. The Joint Guidance further advises that  “[t]his notice should be presented in a manner that permits consumers to cancel the  attempted withdrawal or transfer after receiving the notice.” Id.   54.  Similarly, the list of “best practices” recommended in “Overdraft Protection:  A Guide for Bankers,” issued by the American Bankers Association, includes  offering customers the option of “opting out” of any overdraft programs, and  informing customers, before they access funds, that a particular transaction will  cause them to incur an overdraft fee. A copy of “Overdraft Protection: A Guide for  Bankers” is attached as Exhibit D.   57.  Flagstar Bank’s wrongful overdraft policies and practices described above  harmed Plaintiffs and members of the Class. The following allegations regarding  certain of the named  plaintiffs  are  made  for  purposes  of  illustrating  the  harm   and  damage  sustained  by Plaintiffs  and  members  of  the  Class  as  a  result  of   Flagstar Bank’s wrongful  overdraft policies and practices.   58.  Plaintiff James Lossia Jr. is a current or former checking account customer  of Flagstar Bank.   59.  On or about March 2, 2015, Mr. Lossia had a balance in his Flagstar Bank  Checking account of approximately $3,925.99. Mr. Lossia attempted to make the  following electronic check debit transactions from his account on the same day in  the following order:  (1) $100.00 to DISCOVER DC PYMNTS DCIINTNET  (2) $185.71 to BARCLAYCARD US - CREDITCARD  (3) $200.00 to DISCOVER DC PYMNTS DCIINTNET  (4) $200.00 to CHASE - EPAY.  87.  Plaintiffs and Flagstar Bank have contracted for bank account deposit,  checking, ATM and debit card services, as embodied in Flagstar Bank’s Deposit  Agreement and related documentation.   88.  Under the laws of Michigan, where Flagstar Bank does business, good faith  is an element of every contract pertaining to the assessment of overdraft fees.  Whether by common law or statute, all such contracts impose upon each party a  duty of good faith and fair dealing. Good faith and fair dealing, in connection with  executing contracts and discharging performance and other duties according to  their terms, means preserving the spirit—not merely the letter—of the bargain. Put  differently, the parties to a contract are mutually obligated to comply with the  substance of their contract in addition to its form. Evading the spirit of the bargain  and abusing the power to specify terms constitute examples of bad faith in the  performance of contracts.   90.  Flagstar Bank has breached the covenant of good faith and fair dealing in the  Deposit Agreement through its overdraft policies and practices as alleged herein.   91.  Plaintiffs and the Class have performed all, or substantially all, of the  obligations imposed on them under the Deposit Agreement.   92.  Plaintiffs  and  members  of  the  Class  have  sustained  damages  as  a   result of Flagstar Bank’s breach of the covenant of good faith and fair dealing.  93.  Plaintiffs repeat paragraphs 1 through 92 above.   95.  Considering the great business acumen and experience of Flagstar Bank in  relation to Plaintiffs and the Class, the great disparity in the parties’ relative  bargaining power, the  inconspicuousness and incomprehensibility of the contract  language at issue, the oppressiveness of the terms, the commercial  unreasonableness of the contract terms, the purpose and effect of the terms, the  allocation of the risks between the parties, and similar public policy concerns,  these provisions are unconscionable and, therefore, unenforceable as a matter of  law.   96.  The imposition of overdraft charges which exceed the amount overdrawn  (e.g., the imposition of a $36 charge on an overdraft of less than $36) is itself  unconscionable. Such charges are not reasonably related to the Bank’s cost of  covering the overdraft and/or its risk of nonpayment (where the Bank pays the  overdraft), or to the Bank’s cost of returning the item unpaid (where the Bank does  not pay the overdraft).   97.  Plaintiffs  and  members  of  the  Class have  sustained  damages  as  a  result  of Flagstar Bank’s unconscionable policies and practices as alleged herein.  98.  Plaintiffs repeat paragraphs 1 through 97 above.   A.  Flagstar Bank   Breach of Contract and Breach of the Covenant of Good Faith and Fair  Dealing   Unconscionability  