Opinion
5:23-CV-687-M-KS
08-01-2024
CHRISTOPHER JOHNSON, Plaintiff, v. EXPERIAN INFORMATION SOLUTIONS, Defendant.
MEMORANDUM & RECOMMENDATION
KIMBERLY A. SWANK UNITED STATES MAGISTRATE JUDGE
This pro se civil action is before the court on Defendant's motion to dismiss [DE #13], with Plaintiff having responded in opposition [DE #21]. Where this matter has been referred to the undersigned by the Honorable Richard E. Myers II, Chief United States District Judge, and the parties have not consented to the jurisdiction of the magistrate judge, Defendant's motion is undertaken pursuant to 28 U.S.C. § 636(b)(1)(B) for memorandum and recommendation. For the reasons explained below, it is recommended that Defendant's motion to dismiss be granted.
BACKGROUND
Christopher Johnson, acting pro se, initiated this action in state court on October 30, 2023, seeking to recover money damages from Local Government Federal Credit Union Financial Partners LLC (“LGFCU”) and Experian Information Solutions (“Experian”) for alleged violations of the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. §§ 1681 et seq. (Compl. [DE #1-3].) Plaintiff specifically asserts violations of § 1681i and § 1681s-2. (Id. at 2 ¶ 2.)
LGFCU and Experian timely removed the action to this court (Notice Removal [DE #1]) and, on January 8, 2024, moved to dismiss for failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6) (Mot. Dismiss [DE #13]; Mem. Supp. Mot. Dismiss [DE #14]). On January 29, 2024, Plaintiff responded in opposition to the motion to dismiss. (Pl.'s Resp. Opp'n Mot. Dismiss [DE #21].) Thereafter, Plaintiff voluntarily dismissed without prejudice his claims against LGFCU. (Notice Vol. Dismissal [DE #23].)
Plaintiff's claims stem from LGFCU's alleged inaccurate reporting as late six automobile loan payments from September 2021 through February 2022. (Compl. at 4 ¶ 11.) Plaintiff alleges that Experian failed to conduct a thorough investigation after Plaintiff submitted a dispute regarding the allegedly late payments via the federal Consumer Final Protection Bureau's website in April 2023. (Id at 4 ¶¶ 14-19). Plaintiff claims the payments should not have been reported as late because he received an “accommodation” from LGFCU pursuant to 15 U.S.C. § 1681s-2(a)(1)(F) due to “job loss & covid.” (Id. at 4 ¶ 12); see Mirable v. Bank of America, Natl Assoc., No. 23-CV-1719, 2024 WL 1250265, at *5 (N.D. Ill. Mar. 22, 2024) (explaining how the CARES Act amended the FCRA); Hafez v. Equifax Info. Servs., LLC, 666 F.Supp.3d 455, 457-58 (D.N.J. 2023) (same). Plaintiff has attached two documents to his complaint-an excerpt from an LGFCU magazine containing a column from LGFCU's Chief Executive Officer (Compl. at 6 (“Magazine Article)) and a March 10, 2022, letter addressed to Plaintiff from a financial services officer at LGFCU (Compl. at 10 (“March 2022 Letter”)-which Plaintiff contends support his claim that he received an accommodation from LGFCU.
D ISCUSSION
I. Standard of Review
Rule 12(b)(6) of the Federal Rules of Civil Procedure provides for dismissal of a complaint or any claims contained therein that fail to state a claim upon which relief can be granted. The intent of the rule is to test the sufficiency of a complaint. Edwards v. City of Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999). The court assumes the truth of all facts alleged in the complaint, Erickson v. Pardus, 551 U.S. 89, 94 (2007), and “draw[s] all reasonable inferences in favor of the plaintiff,” Ray v. Roane, 948 F.3d 222, 226 (4th Cir. 2020) (quoting King v. Rubenstein, 825 F.3d 206, 212 (4th Cir. 2016)).“‘The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims.'” Revene v. Charles Cnty. Comm'rs, 882 F.2d 870, 872 (4th Cir. 1989) (quoting Scheuer v. Rhodes, 416 U.S. 232, 236 (1974)). While pro se complaints should be liberally construed, they are not exempt from the “requirement that a pleading contain ‘more than labels and conclusions.'” Giarratano v. Johnson, 521 F.3d 298, 304 n.5 (4th Cir. 2008) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). However, a court does not “act as an advocate for a pro se litigant,” Gordon v. Leeke, 574 F.2d 1147, 1152 (4th Cir. 1978), nor is it required to “‘discern the unexpressed intent of the plaintiff[.]'” Williams v. Ozmint, 716 F.3d 801, 805 (4th Cir. 2013) (quoting Laber v. Harvey, 438 F.3d 404, 413 n.3 (4th Cir. 2006) (en banc)).
A complaint will survive a 12(b)(6) motion to dismiss only if it alleges facts that raise a right to relief above the speculative level. Twombly, 550 U.S. at 555. It need not contain detailed factual allegations, but it must give a defendant fair notice of what the claim is and the grounds upon which it rests. Id.; see also Fed.R.Civ.P. 8(a)(2) (requiring “a short and plain statement of the claim showing that the pleader is entitled to relief”). A “formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555. “While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations,” which are sufficient to raise a claim that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). Facial plausibility is more than “a sheer possibility that a defendant has acted unlawfully.” Id. at 678. It requires the plaintiff to articulate facts “that allow[ ] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id.
When evaluating the sufficiency of a complaint under Rule 12(b)(6), a court generally does not consider extrinsic evidence but only the complaint itself and any “documents attached or incorporated into the complaint.” Johnson v. United States Merit Systems Protections Board, 103 F.4th 984, 999 (4th Cir. 2024) (quoting Zak v. Chelsea Therapeutics Int'l, Ltd., 780 F.3d 597, 606 (4th Cir. 2015). See also Fed.R.Civ.P. 10(c) (“A copy of a written instrument that is an exhibit to a pleading is a part of the pleading for all purposes.”). A court “need not accept as true any allegations in the complaint . . . that are directly contradicted by the [attached] exhibits.” Norman v. Tradewinds Airlines, Inc., 286 F.Supp.2d 575, 581 (M.D. N.C. 2003) (citing Fayetteville Investors v. Commercial Builders, Inc., 936 F.2d 1462, 1465 (4th Cir. 1991)); see also Pendleton v. Jividen, 96 F.4th 652, 656 (4th Cir. 2024) (first citing Erickson v. Pardus, 551 U.S. 89, 94 (2007); and then citing Martin v. Duffy, 858 F.3d 239, 244 n.1 (4th Cir. 2017)) (explaining that “courts routinely look beyond what pro se litigants identify as their ‘complaint' and analyze the substance of any included documents in considering a motion to dismiss for failure to state a claim”).
II. Analysis
Among other things, the FCRA imposes duties on consumer reporting agencies regarding consumer credit information and duties on “furnishers” of consumer credit information, i.e. lenders that provide credit to consumers and who report information regarding that credit to consumer reporting agencies. See Saunders v. Branch Banking & Trust Co. of Virginia, 526 F.3d 142, 147-48 (4th Cir. 2008); Croft v. Bayview Loan Servicing, LLC, 176 F.Supp.3d 582, 587-88 (D.S.C. 2016) (explaining difference between consumer reporting agencies and furnishers of information to consumer reporting agencies under the FCRA).
Section 4021 of the Coronavirus Aid, Relief, and Economic Security Act (commonly known as the CARES Act), Pub. L. No. 116-136, 134 Stat. 281, 489 (2020), amended the FCRA to impose reporting obligations where furnishers of consumer credit offered consumers an “accommodation” during the COVID-19 pandemic. Mirabile, 2024 WL 1250265, at *5. “An accommodation includes any agreement to ‘defer 1 or more payments, make a partial payment, forbear any delinquent amounts, modify a loan or contract, or any other assistance or relief granted to a consumer' affected by COVID-19 during the covered period.” Id. (quoting 15 U.S.C. § 1681s-2(a)(1)(F)(i)(I)). Importantly, for purposes here, “[i]f a furnisher makes an accommodation and the consumer makes the payments (or is not required to make payments due to an accommodation), then the furnisher is obligated to ‘report the credit obligation or account as current.'” Id. (quoting 15 U.S.C. § 1681s-2(a)(1)(F)(ii)(I)).
A. Plaintiff's § 1681s-2(b) Claim
Claims brought pursuant to § 1681s-2(b) of the FCRA only apply to furnishers of information, not crediting reporting agencies. McDaniel v. Hunter Warfield, Inc., No. 5:23-CV-752-D, 2024 WL 1812135, at *4 (E.D. N.C. Apr. 25, 2024) (citing cases). A plaintiff bringing a § 1681s-2(b) claim must show “(1) the furnisher provided inaccurate information, and (2) after the furnisher received notification of a consumer dispute from a [consumer reporting agency], it failed to conduct a reasonable reinvestigation of its records to determine whether the information previously provided was incomplete or inaccurate.” Perry v. Toyota Motor Credit Corp., No. 1:18-CV-34, 2019 WL 332813 (W.D. Va. Jan. 25, 2019); see also Mirabile, 2024 WL 1250265, at *5. As Experian is a credit reporting agency, not a furnisher of consumer credit information, Plaintiff's § 1681s-2(b) claim should be dismissed pursuant to Rule 12(b)(6).
B. Plaintiff's § 1681i Claim
Claims brought pursuant to § 1681i of the FCRA are commonly known as reinvestigation claims. “[A] consumer who brings a § 1681i failure to reinvestigate claim must first show that his ‘credit file contains inaccurate or incomplete information.”' Hinton v. Trans Union LLC, 654 F.Supp.2d 440, 451 (E.D. Va. 2009) (quoting Thomas v. Trans Union, LLC, 197 F.Supp.2d 1233, 1236 (D. Or. 2002)), affirmed, 382 Fed.Appx. 256 (4th Cir. 2010).
Experian argues that Plaintiff's § 1681i claim should be dismissed because Plaintiff does not “plausibly allege any factual inaccuracy in [ ] reporting to sustain any claim under the FCRA.” (Mem. Supp. Mot. Dismiss at 4-6.) Experian contends that Plaintiff has failed to plausibly allege an inaccuracy regarding the disputed late payments because (i) Plaintiff does not dispute he made the payments late and (ii) the Magazine Article and March 2022 LFGCU Letter say nothing about an accommodation, thereby rendering Plaintiff's interpretation of these documents as “fanciful.” (Id. at 6.)
Plaintiff has plausibly alleged an inaccuracy in his credit report based upon the late payments. Plaintiff has expressly alleged that LGFCU offered him an accommodation pursuant to § 1681s-2(a)(1)(F). (Compl. at 4 ¶ 12 (alleging that Senior Loan Officer Kayla Smith of LGFCU “arranged a secondary accommodation with Plaintiff to bring the account back to current”), 11 (alleging in complaint submitted to Consumer Financial Protection Bureau that he received accommodations).) While the Magazine Article and March 2022 Letter do not expressly offer an accommodation to LGFCU members, these documents are not inconsistent with Plaintiff's factual allegations. Moreover, the March 2022 Letter also appears to contain a handwritten note indicating that someone-presumably Plaintiff-spoke with Kayla Smith of LGFCU about that letter. (March 2022 Letter.) If, as alleged in the complaint, Plaintiff received an accommodation from LGFCU, then the disputed late payments on Plaintiff's credit report may be inaccurate. See § 1681s-2(a)(1)(F)(ii); Mirabile, 2024 WL 1250265, at *5. Whether Plaintiff received such an accommodation is a factual issue that precludes dismissal pursuant to Rule 12(b)(6). Accordingly, Defendant's motion to dismiss the § 1681i claim should be denied.
C ONCLUSION
For the foregoing reasons, it is RECOMMENDED that Defendant's motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6) [DE #13] be GRANTED IN PART and DENIED IN PART as follows:
1. Defendant's motion to dismiss Plaintiff's § 1681s-2(b) claim should be GRANTED, and the claim should be DISMISSED for failure to state a claim upon which relief can be granted; and
2. Defendant's motion to dismiss Plaintiff's § 1681i claim should be DENIED.
The Clerk is DIRECTED to serve a copy of this Memorandum and Recommendation on each of the parties or, if represented, their counsel. Each party shall have until August 19, 2024, to file written objections to the Memorandum and Recommendation. The presiding district judge must conduct his or her own review (that is, make a de novo determination) of those portions of the Memorandum and Recommendation to which objection is properly made and may accept, reject, or modify the determinations in the Memorandum and Recommendation; receive further evidence; or return the matter to the magistrate judge with instructions. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b)(3); Local Civ. R. 1.1 (permitting modification of deadlines specified in local rules), 72.4(b), E.D. N.C. (May 2023).
A party that does not file written objections to the Memorandum and Recommendation by the foregoing deadline, will be giving up the right to review of the Memorandum and Recommendation by the presiding district judge as described above, and the presiding district judge may enter an order or judgment based on the Memorandum and Recommendation without such review. In addition, a party's failure to file written objections by the foregoing deadline may bar the party from appealing to the Court of Appeals from an order or judgment of the presiding district judge based on the Memorandum and Recommendation. See Wright v. Collins, 766 F.2d 841, 846-47 (4th Cir. 1985).