WILMINGTON, Del. — A Capital One Financial Corp. stockholder has sued 13 former Discover Financial Services directors and executives, alleging they failed for years to oversee regulatory compliance problems that ultimately cost the company hundreds of millions of dollars.
The double-derivative complaint, filed in Delaware Chancery Court by shareholder Stuart Swaziek, alleges the former Discover leaders breached their fiduciary duties and made misleading statements about the company’s compliance and risk controls, according to Law360.
The lawsuit is the latest chapter in litigation that began before Capital One acquired Discover. Swaziek was among shareholders who filed derivative litigation in 2023 against former Discover CEO Roger Hochschild and other directors and officers after the company disclosed problems involving its compliance systems and the misclassification of credit card accounts. Reuters reported at the time that Discover had agreed to strengthen its consumer compliance program and corporate governance under an FDIC consent order, while separately acknowledging that some card accounts had been incorrectly classified beginning around 2007.
Those problems later produced significantly larger regulatory costs. In April 2025, the Federal Reserve fined Discover $100 million for overcharging certain interchange fees from 2007 through 2023, while the FDIC imposed a separate $150-million civil penalty and ordered at least $1.225 billion in restitution to affected merchants, merchant acquirers and other intermediaries. Regulators said Discover had ended the practices and was working to repay affected parties.
Capital One completed its acquisition of Discover on May 18, 2025, after announcing the all-stock transaction at a value of $35.3 billion in 2024. Because former Discover shareholders received Capital One stock in the deal, Swaziek is now pursuing the claims on behalf of Capital One in what Law360 described as a double-derivative action seeking to hold the former Discover officials responsible for losses tied to the alleged oversight failures.