MEMORANDUM OPINION AND ORDER

ANN MONTGOMERY, District Judge

I. INTRODUCTION

Defendant Sherman Financial Group LLC's ("Sherman") Motion to Dismiss or Alternatively for Summary Judgment [Docket No. 32] was argued before the undersigned United States District Judge on April 30, 2004. Plaintiff Bradley Malm ("Plaintiff") asserts claims under the Fair Debt Collection Practices Act ("FDCPA") and the Fair Credit Reporting Act ("FCRA"), and additionally maintains a claim for credit defamation. For the reasons explained below, Sherman's Motion is denied in part and granted in part.

II. BACKGROUND

Plaintiff and Cheryl Malm divorced in July 1996. Corrected Am. Compl. ¶ 9. Plaintiff learned of the Best Buy card's existence in April 1998 after he tried to obtain a motorcycle loan. Id. ¶ 10. Ms. Malm had failed to make payments on the card, and the Household account tradeline was listed on Plaintiff's credit report under the "Adverse Account Information" section. See Trans Union Credit Report of 03/31/03 (Goolsby Aff. Ex. J). Both Plaintiff and his ex-wife informed Household that Plaintiff should not be listed on the account. See Household collection notes at 04/09/98 entry, 10/10/00 entry (Goolsby Aff. Ex. C). Plaintiff also contacted Best Buy about the mistake, but was told that the Household account would remain on his credit report until either he or his ex-wife paid the balance due. Corrected Am. Compl. ¶ 11.

In March 2000, Plaintiff obtained a copy of his credit report and noticed that the Household account tradeline was absent.Id. ¶ 12. Consequently, he believed that his ex-wife had paid off the account. Instead, the debt had been discharged as the result of Cheryl Malm filing for Chapter 7 bankruptcy during this period. Id. ¶¶ 12-13.

Credit agencies began contacting Plaintiff about the Household account starting in October 2000, and he contested the debt with them. Id. ¶¶ 14-15. Sherman acquired the Best Buy credit card debt from Household on November 20, 2000. Id. ¶ 15; Sherman collection notes (Goolsby Aff. Ex. D). Plaintiff disputed his responsibility for the account with Sherman on several occasions, and requested a copy of the Best Buy credit card application multiple times. See Malm Aff. ¶¶ 1-4, 6; Letter from Malm to Scott of 07/30/01 (Corrected Am. Compl. Ex. 2). In July 2002, Plaintiff also contested the Best Buy debt with Receivables Management Solutions ("RMS"), a collection agency that attempted to recover the account for Sherman. Malm Aff. ¶ 5; Letter from Malm to Dunham of 07/22/02 (Malm Aff. Ex. A). He asked RMS for a copy of the Best Buy application but never received one. Id.

In November 2002, Plaintiff disputed the Household and Sherman tradelines on his credit report with Defendant Trans Union LLC ("Trans Union") and other credit reporting agencies. See Request for Investigation Form (Rossman Aff. Ex. 1). In response, Trans Union sent Sherman a Consumer Dispute Verification Form ("CDV"). See CDV Form (Rossman Aff. Ex. 2). Part one of the CDV requires Sherman to "[c]heck the corresponding Same box for each item that is identical to your records." Id. (emphasis in original). It explains additionally, "[i]f any of this information on the left is incorrect, write the corrections in the boxes on the right." The information to be verified includes Plaintiff's name, current and previous addresses, social security number and date of birth. Under the "Consumer States/Comments" section, the CDV says "Not his/hers," and states further "Provide complete ID." Id. Sherman completed the CDV and confirmed that the data about Plaintiff matched Sherman's records. Id.

The Household and Sherman tradelines remained on Plaintiff's credit reports through the spring of 2003, and Plaintiff continued to request their removal. Trans Union Credit Report of 03/31/03 (Goolsby Aff. Ex. J). Defendant Experian Information Solutions, Inc. ("Experian") removed the Sherman tradeline in April 2003, and Trans Union deleted it in June 2003. Experian Correction Summary (Corrected Am. Compl. Ex 8); Corrected Am. Compl. ¶¶ 25-26. Plaintiff initiated litigation on July 29, 2003.

Sherman made Plaintiff an offer of judgment ("Offer") under Rule 68 on November 6, 2003, offering to pay Plaintiff $1001, plus attorney fees and costs for Plaintiff's FDCPA claim, if Plaintiff dismissed all of its claims against Sherman. Sherman Offer of Judgment of 11/06/03 ¶¶ 1-3 (Rossman Aff. Ex. 3). Plaintiff did not respond to Sherman's offer, and Sherman subsequently filed the present Motion.

III. DISCUSSION

Sherman now moves for dismissal, or alternatively, for summary judgment. Because both Sherman and Plaintiff rely on materials outside of the pleadings, the Court treats this motion as one for summary judgment. See Fed.R.Civ.P. 12(b).

A. Summary Judgment Standard

Federal Rule of Civil Procedure 56(c) provides that summary judgment shall issue "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 judgment as a matter of law." Fed.R.Civ.P. 56(c); see Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). On a motion for summary judgment, the court views the evidence in the light most favorable to the nonmoving party. Ludwig, 54 F.3d at 470. The nonmoving party may not "rest on mere allegations or denials, but must demonstrate on the record the existence of specific facts which create a genuine issue for trial." Krenik v. County of Le Sueur, 47 F.3d 953, 957 (8th Cir. 1995).

B. Plaintiff's FDCPA Claim

Sherman argues that Plaintiff's FDCPA action fails as a matter of law because Plaintiff rejected its Rule 68 Offer of November 2003, which Sherman contends would have mooted the FDCPA claim. In Sherman's view, Plaintiff had no stake remaining in the FDCPA claim and the Court lacked subject matter jurisdiction over the matter. Plaintiff asserts that the Offer did not moot the FDCPA action because it required him to dismiss all of his claims against Sherman, but limited compensation to the FDCPA claim.

Rule 68 authorizes a defendant to make an offer of judgment to an adverse party allowing the court to enter judgment in the plaintiff's favor. See Fed.R.Civ.P. 68. While not specified in Rule 68, "many courts have held that a valid offer of judgment that would satisfy a plaintiff's entire claim for relief eliminates the controversy between the parties and leaves nothing for the court to resolve, effectively mooting the action and removing jurisdiction." Jones v. CBE Group, Inc., 215 F.R.D. 558, 562 (D. Minn. 2003) (Doty, J.); see also Rand v. Monsanto Co., 926 F.2d 596, 598 (7th Cir. 1991); Zimmerman v. Bell, 800 F.2d 386, 390 (4th Cir. 1986); Abrams v. Interco Inc., 719 F.2d 23, 32-34 (2d Cir. 1983). Because there is no actual case or controversy to adjudicate, courts lack subject matter jurisdiction over claims mooted by Rule 68 offers of judgment, where the plaintiff no longer has an interest in the litigation.See U.S. Const. Art. III

§ 2 (limiting judicial power to cases or controversies);United States Parole Comm'n v. Geraghty, 445 U.S. 388, 395 (1980) (holding same); Powell v. McCormack, 395 U.S. 486, 496 (1969) (deeming an action moot when a party no longer has a stake in the matter).

Sherman's Rule 68 Offer did not render Plaintiff's FDCPA claim moot under this standard. Sherman correctly states that its Offer of $1001, plus attorney fees and costs for Plaintiff's FDCPA claim, constitutes the maximum statutory recovery for violations of the FDCPA. See 15 U.S.C. § 1692k; Offer ¶¶ 1-2. Consequently, Sherman's Offer would have mooted Plaintiff's FDCPA claim had it required dismissal of that claim only. See Jones, 215 F.R.D. at 562. However, acceptance of the offer required Plaintiff to dismiss all of his claims, including those asserted under FCRA and state law. See Offer ¶¶ 1, 3. Sherman's Offer did not render the FDCPA claim moot because it did not satisfy Plaintiff's entire claim. Therefore, dismissal of Plaintiff's FDCPA claim is not warranted.

Sherman also argues that the statute of limitations bars Plaintiff's FDCPA claim. FDCPA actions must be filed within one year of an alleged violation. See 15 U.S.C. § 1692k. Plaintiff filed his initial Complaint on July 29, 2003, and filed the Amended Complaint on November 21, 2003, adding his FDCPA claim. See Compl. at 1[Docket No. 1]; Am. Compl. at 1 [Docket No. 25]. Thus, the allegedly unlawful activity underlying Plaintiff's FDCPA claim must have occurred on or after July 29, 2002, given the one year statute of limitations period. See 15 U.S.C. § 1692k.

Based on the allegations in the Corrected Amended Complaint, the statute of limitations does not prohibit Plaintiff's FDCPA claim. Sherman stresses that according to the Corrected Amended Complaint, Sherman "continued its illegal collection campaign until August 2001," and that these activities form the basis of Plaintiff's FDCPA claim. See Corrected Am. Compl. ¶ 17. Thus, in Sherman's view, Plaintiff should have filed his FDCPA claim by August 2002. However, the Corrected Amended Complaint states that Sherman's "fail[ure] to report the Plaintiff's dispute to the credit reporting agencies" constitutes the FDCPA violation, and that this behavior continued through March 2003. See id. ¶ 18. Because Plaintiff asserted his FDCPA claim before March 2004, it is not time-barred. See 15 U.S.C. § 1692k. Therefore, Sherman's Motion for Summary Judgment is denied as to Plaintiff's FDCPA claim.

B. Plaintiff's FCRA Claim

Sherman also moves for summary judgment on Plaintiff's claim for violation of the FCRA, arguing that it complied with the FCRA's requirements. Under the FCRA, entities that furnish information to consumer reporting agencies, called furnishers, must investigate disputed accounts after receiving notice from consumer reporting agencies. See 15 U.S.C. § 1681s-2(b)(1). Upon being given notice as described in § 1681i(2)(A), furnishers must: (1) investigate the disputed information; (2) review all relevant information provided by the consumer reporting agency; (3) report the results of the investigation to the consumer reporting agency; and (4) report conclusions that the information was incomplete or inaccurate to other consumer reporting agencies to which the furnishers provided information. Id. While the FCRA does not specify the type of investigation required, courts presented with this issue have held that § 1681s-2(b)(1) compels furnishers "to conduct a reasonable investigation of their records to determine whether the disputed information can be verified." Johnson v. MBNA Am. Bank, N.A., 357 F.3d 426, 431 (4th Cir. 2004); see also Olwell v. Med. Info. Bureau, No. Civ. 01-1481, 2003 WL 79035, at *5 (D. Minn. Jan. 7, 2003) (Tunheim, J.). To meet this standard, furnishers may need to consult underlying documents such as account applications, rather than simply reviewing data in computerized customer information systems. Johnson, 357 F.3d at 431.

Plaintiff argues that the question of whether Sherman's investigative procedures were reasonable creates issues of fact best left to the jury. He also asserts that Sherman should have reviewed a copy of the credit card application to determine if the account actually belonged to Plaintiff. However, § 1681s-2(b) does not require furnishers to investigate disputes until they receive notice from a consumer reporting agency. See 15 U.S.C. § 1681i(a)(2)(A), 1681s-2(b)(1). Therefore, the Court must first decide whether Sherman received sufficient notice from Trans Union before analyzing the reasonableness of Sherman's investigation.

The CDV form Trans Union sent to Sherman does not identify the basis of Plaintiff's dispute concerning the Best Buy card. The instructions on the CDV ask Sherman to verify Plaintiff's name, address, previous address, social security number and birth date, and to confirm other basic account information. See CDV form. Additionally, the CDV form states "Not his/hers. Provide complete ID," in a box labeled "Consumer States/Comments." Id. The CDV form does not specify that Plaintiff believed the account belonged to his ex-wife only, or that she forged his signature to open it. Consequently, unlike the furnisher in Johnson who received specific notice about the consumer's dispute, Sherman was not given a complete explanation of Plaintiff's concerns. See Johnson, 357 F.3d at 429 (holding that furnisher received notice of the specific dispute from statements "Consumer states belongs to husband only" and "Was never a signer on account. Was an authorized user"). Sherman merely learned that Plaintiff disputed the account in some way, and that Trans Union requested confirmation of Plaintiff's background data.

Sherman's investigation under § 1681s-2(b) was reasonable given the cursory notice it received concerning Plaintiff's dispute. Following the instructions on the CDV form, Sherman verified that Plaintiff's personal information matched its records, and updated the account balance. See CDV form. Sherman apparently did not review the actual application. The cryptic "Not his/hers" did not notify Sherman that additional inquiry was necessary. Id. While specific notice of Plaintiff's concerns could have compelled Sherman to conduct a more thorough review, thus creating an issue of "reasonableness" for the jury, a more rigorous investigation was not required here based on the superficial notice that Trans Union provided. See 15 U.S.C. § 1681s-2(b)(1); Johnson, 357 F.3d at 431 (holding that § 1681s-2(b)(1) requires furnishers to investigate disputes only after receiving adequate notice);Young v. Equifax Credit Info. Servs., Inc., 294 F.3d 631, 640-41 (5th Cir. 2002) (holding same). Therefore, summary judgment is granted on Plaintiff's FCRA claim.

C. Plaintiff's Credit Defamation Claim

Finally, Sherman moves for dismissal of Plaintiff's state law claim for credit defamation, arguing that the FCRA preempts this cause of action. The preemption doctrine, derived from the Supremacy Clause of the United States Constitution, "may be either express or implied, and is compelled whether Congress' command is explicitly stated in the statute's language or implicitly contained in its structure and purpose." Fidelity Fed. Sav. Loan Ass'n v. De la Cuesta, 458 U.S. 141, 152-53 (1982) (internal quotation omitted).

The FCRA contains two seemingly overlapping sections that restrict state law claims against furnishers. FCRA's original preemption section, § 1681h(e), limits liability for defamation, invasion of privacy, and negligence to instances where "false information [was] furnished with malice or willful intent to injure . . . [the] consumer." 15 U.S.C. § 1681h(e). Thus, plaintiffs who show that information was provided with "knowledge that it was false or with reckless disregard of whether it was false or not" may bring claims under § 1681h(e). See Thornton v. Equifax, Inc., 619 F.2d 700, 705 (8th Cir. 1980). Congress added a second preemption provision in 1996, which states that "[n]o requirement or prohibition may be imposed under the laws of any State with respect to any subject matter regulated under . . . section 1681s-2 of this title, relating to the responsibilities of persons who furnish information to consumer reporting agencies. . . ." 15 U.S.C. § 1681t(b)(1)(F), Pub.L. No. 104-208, § 2419, 110 Stat. 3009-452 (1996). The terms of this second preemption section are absolute. Id.

While no circuit court has addressed the issue, numerous district courts have attempted to reconcile these two apparently conflicting sections. See McCloud v. Homeside Lending, 309 F. Supp.2d 1335, 1340-42 (N.D. Ala. 2004); Jeffrey v. Trans Union, L.L.C., 273 F. Supp.2d 725, 726-28 (E.D. Va. 2003); Mattice v. Equifax, Civil No. 03-1060, 2003 WL 21391679, at *1-*4 (D. Minn. June 13, 2003) (Kyle, J.); Gordon v. Greenpoint Credit, 266 F. Supp.2d 1007, 1012-13 (S.D. Iowa 2003); Yutelser v. Sears Roebuck Co., 263 F. Supp.2d 1209, 1211-12 (D. Minn. 2003) (Frank, J.); Aklagi v. NationsCredit Fin. Servs. Corp., 196 F. Supp.2d 1186, 1194-96 (D. Kan. 2002); Hasvold v. First USA Bank, 194 F. Supp.2d 1228, 1239 (D. Wyo. 2002); Jaramillo v. Experian Info. Solutions, Inc., 155 F. Supp.2d 356, 362-63 (E.D. Pa. 2001) (reconsideration granted in part). These courts have reached three different results. First, some have held that § 1681t(b)(1)(F) completely subsumes § 1681h(e) because it provides absolute preemption and was added after § 1681h(e).See Hasvold, 194 F. Supp.2d at 1239; Jaramillo, 155 F. Supp. at 363. However, this interpretation voids § 1681h(e), and thus contradicts the general mandate that courts should consider statutes as a whole to avoid nullifying specific provisions.See United States v. Campos-Serrano, 404 U.S. 293, 301 n. 14 (1971); State Highway Comm'n v. Volpe, 479 F.2d 1099, 1111-12 (8th Cir. 1973) (stating that courts should look to the whole statute when interpreting a particular section). Consequently, the Court declines to adopt this approach.

Other district courts have determined that § 1681t(b)(1)(F) does not preempt common law tort claims, but have reached this conclusion for two different reasons. One group concluded that § 1681t(b)(1)(F) applies to state statutes only, and that § 1681h(e) pertains to common law torts. See McCloud, 309 F. Supp.2d at 1341-42; Jeffrey, 273 F. Supp.2d at 726-28. Another group decided that § 1681h(e), as a specific preemption clause, trumps the more general language of § 1681t(b)(1)(F). Gordon, 266 F. Supp.2d at 1012-13;Yutelser, 263 F. Supp.2d at 1211-12. Under either rationale, plaintiffs who overcome § 1681h(e)'s malice/willful intent standard may pursue common law actions. Id.; see also McCloud, 309 F. Supp.2d at 1341-42; Jeffrey, 273 F. Supp.2d at 726-28. These views are somewhat strained, however, because § 1681t(b)(1)(F) does not specify that it relates to statutes only. See 15 U.S.C. § 1681t(b)(1)(F). Further, as these interpretations greatly minimize § 1681t(b)(1)(F)'s applicability, they run afoul of the "whole statute" approach outlined above, and thus will not be followed by the Court. See Campos-Serrano, 404 U.S. at 301 n. 14; Volpe, 479 F.2d at 1111-12.

Finally, some courts have applied a temporal formula to FCRA's preemption sections based on § 1681t(b)(1)(F)'s absolute immunity for "any matter regulated by section 1681s-2 . . . relating to the responsibilities of [furnishers]. . . ." 15 U.S.C. § 1681t(b)(1)(F); see Mattice, 2003 WL 21391679, at *1-*4;Aklagi, 196 F. Supp.2d at 1194-96. Under this rationale, § 1681t(b)(1)(F) preempts any state law claims based on a furnisher's actions after receiving notice of a dispute, because furnishers then have a duty to investigate under § 1681s-2. See id. However, § 1681h(e) governs preemption of state law claims premised on a furnisher's behavior before receipt of notice, because at that point § 1681s-2 is not implicated. Id.; see also 15 U.S.C. § 1681h(e). The Court finds the temporal approach the most convincing of these three options because it follows the "whole statute" analysis and does not render either section superfluous.

Adoption of the temporal approach leads to the conclusion that § 1681t(b)(1)(F) preempts Plaintiff's credit defamation action because Plaintiff bases his claim entirely on Sherman's actions after it received notice of the disputed account. Plaintiff alleges that Sherman continued reporting the erroneous Best Buy account even after Plaintiff told them that the account was not his. See Corrected Am. Compl. ¶¶ 16-17, 19, 21; Letter from Malm to Scott of 07/30/01 (Corrected Am. Compl. Ex. 2); see also Malm. Aff. ¶¶ 1, 3-4. Additionally, Plaintiff avers that Sherman failed to send Plaintiff a copy of the card application despite his request, and that Sherman conducted a superficial investigation of the disputed account after obtaining the CDV form from Trans Union. Corrected Am. Compl. ¶¶ 17, 21; see also Malm Aff. ¶¶ 2-3. All of these allegations involve Sherman's behavior after Plaintiff explained his concerns, at a time when Sherman was required to comply with § 1681s-2's requirements. Because § 1681t(b)(1)(F) precludes imposition of any state law on matters regulated under § 1681s-2, the FCRA preempts state tort actions premised on a furnisher's post-notice conduct. See 15 U.S.C. § 1681t(b)(1)(F). Therefore, Sherman's Motion for Summary Judgment is granted on Plaintiff's credit defamation claim.

IV. CONCLUSION

1. Defendant Sherman's Motion to Dismiss or Alternatively for Summary Judgment [Docket No. 32] is DENIED as to Plaintiff's FDCPA claim;

2. Defendant Sherman's Motion to Dismiss or Alternatively for Summary Judgment is GRANTED as to Plaintiff's FCRA and credit defamation claims;

3. Counts III and IV of Plaintiff's Corrected Amended Complaint [Docket No. 26] are DISMISSED WITH PREJUDICE as to Defendant Sherman.