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denying summary judgment as to damages because there was a question of fact as to whether defendant's actions were willful under the Act
Summary of this case from MINTER v. AAA COOK COUNTY CONSOLIDATION, INC.Opinion
IP01-1560-C-B/G
October 22, 2003
ENTRY ON PLAINTIFF'S REQUEST FOR SUMMARY JUDGMENT AND PLAINTIFF'S MOTION TO STRIKE DEFENDANT'S RESPONSE IN OPPOSITION TO PLAINTIFF'S REPLY
On March 26, 2003 this Court entered an order denying the Summary Judgment Motion of Defendant, Gregory Purvis ("Purvis") and setting a 30-day deadline for Purvis to respond to Plaintiff's, Lenoard Chester's ("Chester"), request that summary judgment be entered in his favor. Chester was allowed an opportunity to reply to any response that Purvis might choose to file. Since that time, Purvis has filed a response and Chester a reply. In addition, Purvis filed what he refers to as "Defendant's Response in Opposition to Plaintiff's Reply" and Chester seeks to strike the same.
In responding to the summary judgment motion filed by Purvis, Chester asked the Court to sua sponte enter summary judgment in his favor on the issue of Purvis' liability for improper use of Chester's credit report. Although, summary judgment in favor of Chester could have been considered without a specific counter-motion having been filed, we chose to reserve that question until such time as Purvis had an opportunity to respond to Chester's request for summary judgment.
First, Chester's Motion to Strike Defendant's Response in Opposition to Plaintiff's Reply is GRANTED. The March 26th entry did not provide for what amounts to a sur-reply by the Defendant and no leave of Court was sought prior to filing the same. Second, Chester's request that the Court enter summary judgment in his favor is GRANTED IN PART, for the reasons set forth below.
FACTS
The material facts in this Fair Credit Reporting Act ("FCRA") case are uncontested and are no different than those referenced in this court's earlier entry denying the summary judgment motion filed by Purvis. Chester was named as a representative of a putative class of plaintiff's in Hill v. PFS. Purvis was the attorney who represented PFS in that lawsuit. During discovery, Purvis took Chester's deposition, during which he was provided access to Chester's credit record, after Chester suffered an apparent lapse in memory with respect to certain collection actions initiated against him. Ms. Rebecca Pollard, an officer of PFS in attendance at the deposition, showed Chester's credit report to Purvis and "pointed out different items" on the report to Purvis. Purvis Dep., pp. 74-75. Purvis acknowledges that, during the deposition, he may have held the credit report in his own hands. Purvis Dep., p. 85. He also acknowledges that questions which he posed to Chester about his credit history may have been based solely on the credit report supplied by Ms. Pollard because there may not have been a public record which otherwise would have provided a foundation of knowledge for asking those questions. Purvis Dep., pp. 76-80, 85. In sum, Purvis acknowledges that he used some of the information he gathered from Chester's credit report to formulate questions for Chester during his deposition.
SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56c). A genuine issue of material fact exists if there is sufficient evidence for a reasonable jury to return a verdict in favor of the non-moving party on the particular issue. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Eiland v. Trinity Hosp., 150 F.3d 747, 750 (7th Cir. 1998).
On a motion for summary judgment, the burden rests on the moving party to demonstrate "that there is an absence of evidence to support the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). After the moving party demonstrates the absence of a genuine issue for trial, the responsibility shifts to the non-movant to "go beyond the pleadings" and point to evidence of a genuine factual dispute precluding summary judgment. Id. at 322-23, 106 S.Ct. 2548. "If the non-movant does not come forward with evidence that would reasonably permit the finder of fact to find in her favor on a material question, then the court must enter summary judgment against her." Waldridge v. American Hoechst Corp., 24 F.3d 918, 920 (7th Cir. 1994) (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 585-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986)); Celotex, 477 U.S. at 322-24, 106 S.Ct. 2548; Anderson, 477 U.S. at 249-52, 106 S.Ct. 2505).
Summary judgment is not a substitute for a trial on the merits, nor is it a vehicle for resolving factual disputes. Waldridge, 24 F.3d at 290. Therefore, in considering a motion for summary judgment, we draw all reasonable inferences in favor of the non-movant. Venters v. City of Delphi, 123 F.3d 956, 962 (7th Cir. 1997). If genuine doubts remain, and a reasonable fact-finder could find for the party opposing the motion, summary judgment is inappropriate. See Shields Enters., Inc. v. First Chicago Corp., 975 F.2d 1290, 1294 (7th Cir. 1992); Wolf v. City of Fitchburg, 870 F.2d 1327, 1330 (7th Cir. 1989).
As stated in the March 26th Entry, this case seems uniquely susceptible to summary judgment, at least with respect to the issue of liability, in that the material and essential facts are uncontested, making the issue before us a pure matter of law. There is no dispute as to the fact that Purvis used Chester's credit report during his deposition. The issue, therefore, is whether this use was protected or otherwise non-actionable. Either Purvis had a right to use Chester's credit report while deposing him, or he did not. If he did not, then he violated the Fair Credit Reporting Act, 15 U.S.C. § 1681(b)(a) and(f).
LIABILITY
In this round of briefing, Purvis asks the Court to find that a question of fact exists with respect to whether his use of the credit report during the deposition was legitimate under the Act. He claims in his brief and affidavit that his use of the credit report in the deposition was to assist in testing the strength of the underlying debt and its ability to be collected. However, there was no "underlying debt" in this action. The debt was the subject of a collection action in the state court. Admittedly, that action may have spawned the issues which form the basis of Chester's claim in this case, but we are at least one lawsuit removed from characterizing the debt as underlying this action. The unfortunate truth for Purvis is that none of the reasons he proffers as a basis for using the credit report in questioning Chester fall within the strict guidelines of 15 U.S.C. § 1681b.
The list of allowable reasons for using a credit report pursuant to 15 U.S.C. § 1681b(f) are those that are set out as acceptable bases for furnishing the reports in 15 U.S.C. § 1681b(a). Purvis asks the Court to find that his use of the credit report was in harmony with 15 U.S.C. § 1681b(a)(3)(A), which provides in pertinent part that a credit report can be provided (and hence used):
(3) To a person which it has reason to believe — (A) intends to use the information in connection with a credit transaction involving the consumer on whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer; . . .
However, the credit report was not used "in connection with a credit transaction," nor can it be said that this litigation involves "collection of an account." Purvis' contention that he was questioning Chester in part to determine the viability of collecting the debt and therefore to assess potential settlement positions in this litigation does not even remotely resemble what the statute sets forth as an acceptable use.
Purvis points to language in the Sixth Circuit decision in Duncan v. Handmaker, 149 F.3d 424, 428 (6th Cir. 1998), which states "[s]o long as the lawsuit involved the collection of a debt, the attorney is likely to procure the consumer report for a purpose analogous to those enumerated in § 1681b." We have a few problems with this holding as justification for Purvis' use of the report. First, it should be noted that the court in Duncan did not find that the attorney had procured the credit report in compliance with the statute when he obtained it for purposes of assisting with the defense of a negligence suit. Second, this lawsuit does not involve the "collection of a debt." And, finally, the suggestion that one could obtain a credit report for a use which is "analogous" to those enumerated in the statute does not comport with a strict interpretation of legislation which lists allowable circumstances and prefaces the list with the phrase "and no other." 15 U.S.C. § 1681b(a).
WILLFUL OR NEGLIGENT VIOLATION
Title 15 U.S.C. § 1681n addresses liability for wilful violations of the FCRA. Negligent violations of FCRA are covered by § 1681o. Chester argues that Purvis' violation was clearly intentional, based upon Purvis' admitted familiarity with FCRA and his experience as an attorney in the collections and credit area. Purvis rejoins that any violation was not intentional and at a minimum a question of fact exists in that regard. We agree that a question of fact exists as to whether the violation was intentional.
In order to establish an intentional violation under § 1681n, which allows for a potential punitive damage award, Chester must establish that Purvis "knowingly and intentionally committed an act in conscious disregard for the rights of others." Pinner v. Schmidt, 805 F.2d 1258, 1263-1264 (5th Cir. 1986). We think that Chester is far from establishing such intent at this point, but will not foreclose his ability to present more convincing evidence to that effect at trial. As faint a hope as that seems to be, we are not to substitute our judgment of the facts for that of the jury, so long as the evidence of record supports a not wholly unreasonable inference. Anderson, 477 U.S. at 248.
DAMAGES
Purvis also challenges Chester's claim of entitlement to an award of damages, arguing that Chester has come forward with no evidence of damages. Relying on Crable v. Trans Union, LLC., 259 F.3d 662 (7th Cir. 2001), he asks us to hold that there is no case or controversy or, at a minimum, there is a material question of fact precluding summary judgment in favor of Chester. We agree with the latter, not the former.
Crable, along with the Supreme Court's decision in Buckhannon Board Care Home, Inc. v. West Virginia Dept. of Health Human Resources, 531 U.S. 1004 (2001) supports the proposition that if plaintiff is unable to demonstrate damages sufficient to obtain some type of relief, there would be no entitlement to attorney fees regardless of a victory on the statutory violation. Further, Purvis contends, there is a strong chance of such an outcome here. However, in looking at this matter from the standpoint of whether Chester is entitled to summary judgment on damages, we can certainly say that at this point he has established no such entitlement, but it would be premature for the Court to shut off his ability to offer evidence of any damages he may have incurred This is an issue to be developed at trial.
CONCLUSION
As a matter of law, we hold that Defendant Purvis' use of Plaintiff Chester's credit report in connection with Chester's deposition in the PFS litigation was a violation of 15 U.S.C. § 1681b(f). Therefore, we GRANT IN PART Plaintiff's request for summary judgment. The trial on December 8, 2003 will address whether the violation was willful or negligent, whether or not Plaintiff incurred damages as a result of this violation and, if so, in what amount. Finally, Plaintiff's Motion to Strike Defendant's Response in Opposition to Plaintiff's Reply is GRANTED.
SO ORDERED