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Jackson v. Equifax Information Services LLC

United States District Court, M.D. Georgia, Macon Division

January 11, 2019




         Before the Court is Defendant U.S. Auto Credit Corporation's (“U.S. Auto”) Motion to Dismiss [Doc. 31] for lack of subject-matter jurisdiction and for failure to state a claim. For the reasons explained below, the Court DENIES this motion.


         The Court is obligated to dismiss any case in which it finds that it does not have subject-matter jurisdiction. Butler v. Morgan, 562, Fed.Appx. 832, 834 (11th Cir. 2014) (“A court must dismiss a complaint if it determines that jurisdiction is lacking.”). A challenge to subject-matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1) can be either facial or factual. See McElmurray v. Consol. Gov't of Augusta-Richmond Cty., 501 F.3d 1244, 1251 (11th Cir. 2007). Where, as in this case, the movant's motion is based on the plaintiff's failure to allege a basis for subject-matter jurisdiction, the challenge is facial. See Lawrence v. Dunbar, 919 F.2d 1525, 1529 (11th Cir. 1990). When considering a facial challenge to the Court's subject-matter jurisdiction, “a plaintiff is afforded safeguards similar to those provided in opposing a Rule 12(b)(6) motion-the [C]ourt must consider the allegations of the complaint to be true.” Id.

         A motion to dismiss under Rule 12(b)(6) tests the sufficiency of the allegations in a plaintiff's complaint. Acosta v. Campbell, 309 Fed.Appx. 315, 317 (11th Cir. 2009). A plaintiff's claims will survive a motion to dismiss if the complaint pleads “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). However, the Court need not accept as true “[t]hreadbare recitals of the elements of a cause of action” or “conclusory statements.” Iqbal, 556 U.S. at 678. Thus, to decide whether a complaint survives a motion to dismiss, district courts are instructed to use a two-step framework. See McCullough v. Finley, 907 F.3d 1324, 1333, (11th Cir. 2018). The first step is to identify the allegations that are “no more than mere conclusions.” Id. (quoting Iqbal, 556 U.S. at 679). “Conclusory allegations are not entitled to the assumption of truth.” Id. (citation omitted). After disregarding the conclusory allegations, the second step is to “assume any remaining factual allegations are true and determine whether those factual allegations ‘plausibly give rise to an entitlement to relief.'” Id. (quoting Iqbal, 556 U.S. at 679). The Court recounts the facts of this case below in light of this standard.


         This Fair Credit Reporting Act (“FCRA”) case arises out of Defendants U.S. Auto, Wells Fargo Bank, N.A. (“Wells Fargo”), and WebBank's (collectively “Furnisher Defendants”) allegedly inaccurate reporting of Plaintiff's credit information. [Doc. 25, at ¶ 7]. Plaintiff alleges that on March 30, 2018, he obtained credit disclosures from Defendants Equifax Information Services, LLC (“Equifax”) and Trans Union, LLC (“Trans Union”). [Id. at ¶15]. The Trans Union disclosure allegedly showed that Defendant U.S. Auto incorrectly reported a scheduled monthly payment of $498 despite Defendant U.S. Auto having charged off and closed the account. [Id. at ¶¶ 8 & 11]. Likewise, the Equifax disclosure allegedly showed that Defendant Wells Fargo incorrectly reported a scheduled monthly payment of $522 despite having charged off the account. [Id. at ¶ 9]. On April 2, 2018, Plaintiff allegedly obtained a credit disclosure from Defendant Experian Information Solutions, Inc. (“Experian”) which also included a scheduled monthly payment on an account that had been charged off, in this case by Defendant WebBank. [Id. at ¶10].

         Plaintiff maintains that, because Defendants Wells Fargo, U.S. Auto, and WebBank had charged off these accounts, he no longer had an obligation to make monthly payments on them. [Doc. 25, at ¶ 12]. Accordingly, in Plaintiff's view, the scheduled monthly payments should have been listed as zero dollars. [Id.]. After becoming aware of the allegedly inaccurate trade lines, Plaintiff allegedly sent letters to Defendants Trans Union, Equifax, and Experian, informing them of the perceived inaccuracy and requesting that they alter the trade lines to reflect a scheduled monthly payment of zero dollars. [Id. at ¶¶ 17-19]. Plaintiff maintains that Defendants Equifax, Trans Union, and Experian then forwarded these letters to the Furnisher Defendants so that they could investigate the alleged inaccuracies. [Id. at ¶ 20]. Plaintiff asserts that he did not receive Defendants Trans Union or Experian's investigation results by June 25, 2018, so he obtained additional credit disclosures from these Defendants which showed that they or the Furnisher Defendants had refused to report the scheduled monthly payment as zero dollars. [Id. at ¶ 22]. Similarly, Plaintiff asserts that he did not receive Defendant Experian's investigation results by July 26, 2018, so he obtained an additional credit disclosure from Defendant Experian which also showed that either Defendant Experian or Defendant WebBank failed or refused to report the trade line as Plaintiff requested. [Id. at ¶ 23]. In light of Defendants' refusal to alter their credit disclosures, Plaintiff filed this action against Defendants for negligent and willful violations of the FCRA alleging financial and emotional injuries. See [Doc. 25, at ¶¶ 24, 26, 33, 38, 45, 51, 57, 64, 71, 78, 85, 92 & 99].


         Defendant U.S. Auto raises two grounds for dismissal. First, U.S. Auto argues that Plaintiff has not alleged that he suffered an injury that would satisfy Article III's standing requirement. See [Doc. 31, at pp. 4-5]. See also Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016) (discussing standing as rooted in Article III's case or controversy requirement). Second, U.S. Auto argues that, even if Plaintiff has standing, his Amended Complaint [Doc. 25] fails to state a claim for which relief may be granted. See generally [Doc. 31]. The Court discusses these arguments in turn.

         I. STANDING (RULE 12(B)(1) MOTION)

         The Court finds that Plaintiff has sufficiently alleged an injury to satisfy Article III's standing requirement. In Spokeo, Inc. v. Robins, the Supreme Court held that for a plaintiff to have standing, he or she “must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the Defendant, and (3) that is likely to be redressed by a favorable judicial decision.” 136 S.Ct. at 1547. Defendant U.S. Auto argues that Plaintiff did not “sufficiently allege that U.S. Auto committed a statutory violation which resulted in any concrete, particularized, harm that Plaintiff was deprived of and which Congress sought to protect in enacting the FCRA.” [Doc. 31, at p. 5]. Simply put, Defendant U.S. Auto maintains that Plaintiff has not alleged that he suffered “an injury in fact.”[1] Spokeo, Inc., 136 S.Ct. at 1547. The Court disagrees.

         Plaintiff, in his Amended Complaint, makes several allegations that clearly satisfy the injury in fact requirement. For example, Plaintiff alleges that “[a]s a direct and proximate cause of U.S. Auto's willful failure to perform its duties under the FCRA, Plaintiff has suffered damages, mental anguish, suffering, humiliation, and embarrassment.” [Doc. 25, at ¶ 35]. Plaintiff further alleges that he “has suffered credit and emotional damages” as a result of the allegedly inaccurate trade lines including “undue stress and anxiety” and the inability to obtain “more favorable credit terms.” [Id. at 24].[2] Both types of injuries-emotional and credit-related-are compensable under the FCRA. See Thompson v. San Antonio Retail Merchs. Ass'n, 682 F.2d 509, 513 (5th Cir. 1982) (“Even when there are no out-of-pocket expenses, humiliation and mental distress do constitute recoverable elements of damage under the [FCRA].”); Moore v. Equifax Info. Servs. LLC, 333 F.Supp.2d 1360, 1365 (N.D.Ga. 2004) (“Plaintiff testified that he suffered humiliation and embarrassment as a result of Equifax's inaccurate credit report. Such damages for mental distress are recoverable under the FCRA even if the consumer has suffered no out-of-pocket losses.”) (internal citation omitted); Hickman v. Pa. Higher Educ. Assistance, No. 1:17-CV-0388-LMM-JFK, 2017 WL 8186732, at *4 (N.D.Ga. Sept. 27, 2017) (holding that allegation that plaintiff's creditworthiness was impacted by inaccurate credit disclosure was sufficient to satisfy injury in fact requirement for standing). Therefore, Plaintiff's allegations that he suffered these types of injuries are sufficient to satisfy the injury in fact requirement to give him standing to bring this claim.[3]Consequently, the Court denies Defendant U.S. Auto's Rule 12(b)(1) motion.


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