Opinion
8:20-cv-2285-JSM-SPF
10-29-2021
SIAN SHIPLEY, Plaintiff, v. HUNTER WARFIELD, INC., Defendant.
ORDER
JAMES S. MOODY, JR., UNITED STATES DISTRIC T JUDGE.
THIS CAUSE is before the Court upon Defendant's Motion for Summary Judgment (Dkt. 48), Defendant's Daubert Motion to Exclude Plaintiff's Experts (Dkt. 49), Plaintiff's Responses in Opposition (Dkts. 52, 53), and Defendant's Replies (Dkts. 56, 57). The Court, having reviewed the filings, record evidence, and being otherwise advised in the premises, concludes that the motion for summary judgment should be denied and the Daubert motion should be granted in part and denied in part.
BACKGROUND
Plaintiff Sian Shipley is a victim of identity theft. A fraudster used her information to enter a lease agreement with Camden Places in Atlanta, Georgia. The fraudster then failed to pay rent and was evicted. Camden assigned the debt to Defendant Hunter Warfield, Inc. for collection. Shipley claims that Hunter furnished derogatory information on the fraudulent rental account (referred to in the industry as “tradeline”) to each of the “Big Three” consumer reporting agencies (“CRAs” or “credit bureaus”): Equifax, Experian, and Trans Union. Shipley then disputed the tradeline directly with the CRAs.
Shipley further alleges that, after she disputed the accuracy and completeness of the tradeline to the CRAs, Hunter wrongly “verified” that the disputed, fraudulent tradeline should remain in Shipley's credit files in violation of the Fair Credit Reporting Act (“FCRA”). This significantly impacted Shipley's credit and caused her emotional distress, among other damages. The Court will discuss the facts in more detail in the context of its discussion of Hunter's motions. Notably, all facts are interpreted in a light most favorable to Shipley, the non-movant. The Court's analysis must begin with Hunter's Daubert motion because the admissibility of the experts' opinions impacts the summary judgment discussion. But, first, the Court turns to the FCRA provisions at issue.
DISCUSSION
I. The FCRA
The FCRA requires that credit reporting agencies and those entities that furnish information to them (“furnishers”), like Hunter, investigate any disputed information. Thus, when a consumer disputes information with a credit reporting agency, the agency must “conduct a reasonable reinvestigation to determine whether the disputed information is inaccurate.” 15 U.S.C. § 1681i(a)(1)(A). As part of this investigation, the agency is required to notify the furnisher that the consumer disputes the information. Id. § 1681i(a)(2). Upon receipt of this notice, the furnisher of the information must: (1) “conduct an investigation with respect to the disputed information”; (2) “review all relevant information provided by the consumer reporting agency” in connection with the dispute; and (3) “report the results of the investigation to the credit reporting agency.” Id. § 1681s-2(b)(1)(A)-(C).
Should the investigation determine that the disputed information is “inaccurate or incomplete or cannot be verified,” the furnisher must “as appropriate, based on the results of the reinvestigation promptly ... modify[,] ... delete [or] permanently block the reporting” of that information to consumer reporting agencies. Id. § 1681s-2(b)(1)(E). See generally Hinkle v. Midland Credit Mgmt., Inc., 827 F.3d 1295, 1301 (11th Cir. 2016).
“The ‘appropriate touchstone' for evaluating a furnisher's investigation under § 1681s-2(b) is ‘reasonableness.'” Felts v. Wells Fargo Bank, N.A., 893 F.3d 1305, 1312 (11th Cir. 2018) (quoting Hinkle, 827 F.3d at 1301-02). “[W]hat constitutes a ‘reasonable investigation' will vary depending on the circumstances of the case.” Id. “When a furnisher ends its investigation by reporting that the disputed information has been verified as accurate, the question of whether the furnisher behaved reasonably will turn on whether the furnisher acquired sufficient evidence to support the conclusion that the information was true.” Id. “When a furnisher reports that disputed information has been verified, the question of [the reasonableness of the investigation] ... will normally be reserved for trial.” Hinkle, 827 F.3d at 1303.
“Under 15 U.S.C. § 1681n(a), any person who willfully fails to comply with any requirement imposed under this subchapter is liable to the affected consumer for actual, statutory, or punitive damages.” Marchisio v. Carrington Mortg. Servs., LLC, 919 F.3d 1288, 1302-03 (11th Cir. 2019) (citing Collins v. Experian Info. Sols., Inc., 775 F.3d 1330, 1336 (11th Cir. 2015). “[R]eckless disregard of a requirement of [the] FCRA would qualify as a willful violation within the meaning of § 1681n(a).” Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 71 (2007); see also Harris v. Mexican Specialty Foods, Inc., 564 F.3d 1301, 1310 (11th Cir. 2009) (“A violation is ‘willful' for the purposes of the FCRA if the defendant violates the terms of the Act with knowledge or reckless disregard for the law.”). Recklessness means “conduct violating an objective standard: action entailing an unjustifiably high risk of harm that is either known or so obvious that it should be known.” Safeco, 551 U.S. at 68 (quotations omitted).
II. Hunter's Daubert Motion
A. Standard for Excluding Expert Testimony
Federal Rule of Evidence 702, which governs the admissibility of expert testimony, provides:
A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if: (a) the expert's scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or determine a fact in issue; (b) the testimony is based on sufficient facts or data; (c) the testimony is the product of reliable principles and methods; and (d) the expert has reliably applied the principles and methods to the facts of the case.
“‘[T]he task of ensuring that an expert's testimony both rests on a reliable foundation and is relevant to the task at hand' is assigned to the district court.” United Fire & Cas. Co. v. Whirlpool Corp., 704 F.3d 1338, 1341 (11th Cir. 2013) (quoting Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 597 (1993)).
In Rink v. Cheminova, Inc., 400 F.3d 1286 (11th Cir. 2005), the Eleventh Circuit explained:
To fulfil their obligation under Daubert, district courts must engage in a rigorous inquiry to determine whether: (1) the expert is qualified to testify competently regarding the matters he intends to address; (2) the
methodology by which the expert reaches his conclusions is sufficiently reliable as determined by the sort of inquiry mandated in Daubert; and (3) the testimony assists the trier of fact, through the application of scientific, technical, or specialized expertise, to understand the evidence or to determine a fact in issue. The party offering the expert has the burden of satisfying each of these three elements by a preponderance of the evidence.Id. at 1291-92 (internal quotation marks omitted).
In assessing the reliability of a scientific expert's testimony, district courts should consider the following four factors: (1) whether the expert's methodology has been tested or can be tested; (2) whether the theory or technique used by the expert has been subjected to peer review and publication; (3) whether there is a known or potential error rate of the methodology; and (4) whether the technique has been generally accepted in the relevant scientific community. United Fire & Cas. Co., 704 F.3d at 1341 (citing Daubert, 509 U.S.
at 593-94). “At the same time, the [Supreme] Court has emphasized that these factors are not exhaustive and are intended to be applied in a ‘flexible' manner.” Id. (quoting Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137, 141 (1999)).
With respect to experts with technical rather than scientific knowledge the Supreme Court in Kumho Tire concluded that:
Daubert's general holding-setting forth the trial judge's general “gatekeeping” obligation-applies not only to testimony based on “scientific” knowledge, but also to testimony based on “technical” and “other specialized” knowledge. See Fed. Rule Evid. 702. We also conclude that a trial court may consider one or more of the more specific factors that Daubert mentioned when doing so will help determine that testimony's reliability. But, as the Court stated in Daubert, the test of reliability is “flexible,” and Daubert's list of specific factors neither necessarily nor exclusively applies to all experts or in every case. Rather, the law grants a district court the same broad latitude when it decides how to determine reliability as it enjoys in respect to its ultimate reliability determination.526 U.S. at 141-42 (emphasis in original).
The objective of Daubert's gatekeeping requirement is to ensure “that an expert, whether basing testimony upon professional studies or personal experience, employs in the courtroom the same level of intellectual rigor that characterizes the practice of an expert in the relevant field.” Id. at 152. The gatekeeping role is “significant” because an “expert's opinion ‘can be both powerful and quite misleading.'” U.S. v. Frazier, 387 F.3d 1244, 1260 (11th Cir. 2004) (quoting Daubert, 509 U.S. at 595). Daubert also reminds litigants that “[v]igorous cross-examination, presentation of contrary evidence, and careful instruction on the burden of proof are the traditional and appropriate means of attacking shaky but admissible evidence.” 509 U.S. at 596.
B. Analysis
1. Evan Hendricks
Hunter moves to exclude Evan Hendricks, Shipley's expert on the issue of the reasonableness of Hunter's investigation into her disputes of the fraudulent rent tradeline. The Court begins with a discussion of Hendricks' expert report. “Since 1981, [Hendricks has] been Editor/Publisher of Privacy Times, a biweekly, Washington-based newsletter that reports on privacy and information law, including the [FCRA].” (Dkt. 49-1 at 32). Hendricks has “researched, written, edited and published many articles on Congressional and State legislative actions, judicial opinions, industry trends and actions, executive branch policies and consumer news as they related to the FCRA.” Id. He is also the author of a book on credit scoring and reporting. Id.
“Since the early 1990s, [Hendricks has] served as an expert witness in numerous FCRA cases and [has] been qualified by the federal courts.” Id. at 33. “As an expert witness, [he has] had the opportunity to read thousands of pages of deposition testimony by consumer reporting agency officials and by credit grantor personnel responsible for reporting data to [credit reporting agencies (CRAs)]. This is significant because CRAs and credit grantors do not openly discuss or publish information on their procedures and practices for handling personal data.” Id. In addition, Hendricks has “testified numerous times before Congress-always by invitation-on issues related to the collection, maintenance, security, use and disclosure of sensitive personal data, including credit reports and other financial information.” Id. at 31.
In his report, Hendricks opines, among other things, that:
• A well-known and long-standing cause of credit report inaccuracy is the furnishing of erroneous data by furnishers such as Hunter Warfield.
• Adding to the probability that Hunter would furnish inaccurate data was the fact that Plaintiff was a victim of identity theft. This is because the fraudulent data and tradeline generated by the fraudster were then furnished by Hunter to consumer reporting agencies (“CRAs” or “credit bureaus”) per Plaintiff's Social Security number (“SSN”) and name. This caused the derogatory data generated by the fraudster to be added to Plaintiff's credit bureau files.
• Hunter failed to adequately investigate the false, fraud-related data disputed by Plaintiff. Plaintiff's dispute information provided Hunter with solid evidence she was a victim of fraud, as well as a handy roadmap to investigate.
• But Defendant failed to give due regard to Plaintiff's dispute and the accompanying information, and essentially disregarded it. This was integral to Hunter's failures to conduct an adequate investigation, which was reasonably calculated to determine whether the disputed information was inaccurate or incomplete or fraudulent. Instead, Defendant engaged in its discredited version of the ACDV-exchange in which CRAs sent a notice of dispute to Hunter, and then, without conducting an adequate investigation, instructed [Transunion] and other CRAs to keep the fraudulent collection in Plaintiff's credit files.
• Hunter's so-called “investigation” was inadequate because it was not concerned with determining or reasonably calculated to determine whether the disputed
information was inaccurate, incomplete or fraudulent. In Plaintiff's case, for instance, after she disputed the Hunter collection was the result of fraud and therefore not hers, Hunter's practice/policy and/or procedure (“PPP”) was to check to see if it has documents from the client, including a “signed” lease. Hunter's decision to verify that the fraudulent debt was Plaintiff's responsibility was based on the existence of the client's “signed” lease. The problem with this is the client's supposedly “signed” lease did not actually include an actual or “wet” signature that could be compared to Plaintiff's signature.
• However, prior to completing any investigation, Hunter returned to CRAs “ACDVs” claiming to them, “23 - disputed information accurate.” This meant that Hunter was instructing the CRAs to keep the fraudulent, derogatory data in Plaintiff's credit files.
• Moreover, Plaintiff stated in her August 2020 dispute letter that she had never lived in any of the apartments whose collectors, liked Hunter, had reported collections to her CRA files. But Hunter never did anything to investigate this aspect of her dispute in relation to its collection, which was based on her having lived in an Atlanta, Georgia apartment, which she never had.
• Defendant's failures to adequately reinvestigate/investigate Plaintiff's dispute, which resulted in inaccurate, derogatory data remaining in Plaintiff's credit file, reflected its serious disregard for established standards of accuracy, and for fairness, and privacy.
• Defendant's inaccurate reporting damaged Plaintiff's [sic], by portraying her as wrongly having a collection with an unpaid balance of more than $8,000.
• It is well known in the field of credit reporting and credit scoring that victims of chronic credit report inaccuracy are subjected to and endure a common pattern of problems. This meant that the kinds of problems Defendant inflicted upon Plaintiff, which were consistent with those experienced by previous victims of chronic credit report inaccuracy, were or should have been foreseeable to Defendant.(Dkt. 49-1 at 2-3).
Hunter first challenges Hendrick's experience and methodology and seeks to exclude the entirety of his opinion. The Court disagrees that Hendrick is unqualified to testify about any portions of his opinion. Indeed, numerous federal district courts have concluded that “[g]iven Hendricks's extensive experience in [the credit reporting industry] and the nature of his testimony, which is based on his observations of issues with [credit reporting] procedures over several decades,” Hendricks's “proposed testimony is sufficiently reliable to pass scrutiny under Rule 702.” Anderson v. Equifax Info. Servs., LLC, No. 2:16-cv-2038-JAR, 2018 WL 1542322, at *4 (D. Kan. Mar. 29, 2018); see also Ma v. Equifax Info. Servs., LLC, 288 F.Supp.3d 1360, 1366-67 (N.D.Ga. 2017) (“Mr. Hendricks has accumulated a wealth of personal knowledge and experience in consumer credit reporting agency practices. Therefore, the Court finds that Mr. Hendricks's methods are sufficiently reliable, and that Defendant's objections go more towards the weight of Mr. Hendricks's testimony than to its admissibility.”).
As the Court's sister court recently explained: “Indeed, Hendricks' methodology of analyzing a data furnisher's policies and actions by comparing them to standard industry practices is reliable, so long as he is able to explain the basis for his knowledge of industry standards.” Brinkman v. Acct. Resol. Servs., No. 8:20-CV-2453-VMC-AAS, 2021 WL 4340413, at *5 (M.D. Fla. Sept. 23, 2021) (citing Valenzuela v. Equifax Info. Servs. LLC, No. cv-13-02259-PHX-DLR, 2015 WL 6811585, at *2 (D. Ariz. Nov. 6, 2015)) (noting that Hendricks' “method is simply an application of his experience with and understanding of the FCRA and the credit reporting industry to the facts at hand” and finding that, “[a]lthough his methods are not meticulously detailed for every conclusion, they can be understood and are reliable”); see also Malverty v. Equifax Info. Servs., LLC, No. 8:17-cv-1617-JDW-AEP, 2019 WL 5549146, at *2 (M.D. Fla. Oct. 28, 2019) (“Hendricks is allowed to testify about what additional measures Equifax could have taken to ensure the accuracy of Rennick's consumer report, both prior to and following the disputes. This could include whether Equifax's ‘procedures match industry standards if he discusses the basis for his knowledge of industry standards, explains how he applied his experience to the facts and how such application yields his opinion.'” (citation omitted)).
Any alleged flaws in Hendricks' methodology should be addressed during crossexamination. See Maiz v. Virani, 253 F.3d 641, 666 (11th Cir. 2001) (“Vigorous crossexamination, presentation of contrary evidence, and careful instruction on the burden of proof are the traditional and appropriate means of attacking [debatable] but admissible evidence.” (citations and internal quotation marks omitted)). Thus, the motion to exclude Hendricks is denied as to reliability.
However, the Court agrees with Hunter that portions of Hendricks' opinion will not assist the trier of fact. As stated above, expert testimony must also assist the trier of fact. Fed.R.Evid. 702. “By this requirement, expert testimony is admissible if it concerns matters that are beyond the understanding of the average lay person.” Frazier, 387 F.3d at 1262 (citation omitted). “[T]he court must ‘ensure that the proposed expert testimony is “relevant to the task at hand,” ... i.e., that it logically advances a material aspect of the proposing party's case.'” Allison v. McGhan, 184 F.3d 1300, 1312 (11th Cir. 1999) (citation omitted). “Proffered expert testimony generally will not help the trier of fact when it offers nothing more than what lawyers for the parties can argue in closing arguments.” Frazier, 387 F.3d at 1262-63 (citation omitted).
Hunter argues, in relevant part, that a number of Hendricks' opinions are impermissible legal conclusions. Hunter also argues that Hendricks should not be permitted to testify about how the inaccurate information damaged Shipley. The Court agrees with Hunter with respect to legal conclusions, types of available damages, and the extent of Shipley's damages.
With respect to legal conclusions, numerous district courts hold that “[n]o witness may offer legal conclusions or testify to the legal implications of conduct.” Dudash v. S.-Owners Ins. Co., No. 8:16-cv-290-JDM-AEP, 2017 WL 1969671, at *2 (M.D. Fla. May 12, 2017). Therefore, Hendricks may not testify as to whether Hunter's investigation was reasonable or provide any other legal conclusion. See Malverty, 2019 WL 5549146, at *3 (holding that Hendricks may not “testify about whether Equifax's existing procedures or conduct were unreasonable, reckless, inadequate, or offer any other legal conclusion”); Anderson, 2018 WL 1542322, at *6 (“Hendricks may reference FCRA and industry standards in testifying about the credit reporting industry, Defendant's conduct, and perceived issues with Defendant's processes and procedures. But in doing so, Hendricks must avoid expressing ultimate legal conclusions regarding the reasonableness of Defendant's procedures for ensuring maximum possible accuracy and conducting reinvestigations of credit report disputes.”).
Also, Hendricks may not testify about the damages Shipley incurred. See Malverty, 2019 WL 5549146, at *2 (“I agree with the reasoning of the courts that have excluded Hendricks' testimony on damages. There is no indication that he ever met Rennick, and any opinion on whether Equifax caused Rennick emotional distress would therefore be speculative. Moreover, any opinion about the types of damages that are common to plaintiffs in comparable circumstances would not assist the jury, as it will be instructed on the proper measure of damages.”); see also Brown v. Vivint Solar, Inc., No. 818CV2838T24JSS, 2020 WL 1479079, at *3 (M.D. Fla. Mar. 26, 2020) (“Accordingly, the Court grants Defendants' motion to the extent that Hendricks may not opine regarding Plaintiffs' emotional or physical damages or the emotional and physical damages that generally arise from FCRA violations.”).
The Court concludes that the rest of Hendricks' testimony will be helpful to the jury. “[U]nderstanding the inner workings of the credit reporting industry may require some specialized knowledge. And [ ] Hendricks's unique and specialized knowledge regarding credit reporting [ ] practices may help the jury contextualize and make sense of complicated information.” Ma, 288 F.Supp.3d at 1367; see also Anderson, 2018 WL 1542322, at *4 (“A layperson is likely not to have this detailed knowledge, and the Court finds that Hendricks's testimony regarding the nature of credit reports, FCRA standards, mixed files, and Defendant's ‘inner workings' would be helpful to the trier of fact in understanding both credit industry standards and Defendant's policies and procedures regarding mixed files.”). Accordingly, the motion with respect to Hendricks is granted in part and denied in part.
2. Dr. Stan Smith
Dr. Stan Smith, an economist, was retained to calculate Shipley's damages. Smith opines that Shipley suffered five types of damages as a result of Hunter's inadequate investigation: (1) the loss of credit expectancy; (2) additional auto-loan interest; (3) the loss of mortgage expectancy; (4) the value of time spent; and (5) the reduction in value of life (“RVL”), also known as loss of enjoyment of life or “hedonic damages.” Hunter moves to exclude Smith's opinion in its entirety but focuses most of its arguments on Smith's calculation of hedonic damages. In response, Shipley does not oppose Hunter's motion with respect to Smith's discussion of hedonic damages, so the motion is granted to this extent.
The Court concludes that Smith's opinions about the loss of credit expectancy, the additional auto-loan interest, and the loss of mortgage expectancy are reliable based on his extensive experience as an economist and his calculations of the interest rates Shipley would have received if her credit had not been negatively impacted by the fraudulent rent tradeline. These calculations would also be helpful to the jury. Hunter is free to challenge these amounts at trial, which implicates the weight of Smith's opinions, not the admissibility.
However, the Court will not permit Smith to testify about the value of Shipley's time trying to remedy Hunter's alleged inadequate investigation. Shipley may testify on this matter and the jury may calculate a number based on Shipley's testimony. Accordingly, the motion with respect to Smith is granted in part and denied in part.
III. Hunter's Motion for Summary Judgment
A. Standard of Review
Motions for summary judgment should be granted only when “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any show there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) (internal quotation marks omitted); Fed.R.Civ.P. 56(c). The existence of some factual disputes between the litigants will not defeat an otherwise properly supported summary judgment motion; “the requirement is that there be no genuine issue of material fact.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The substantive law applicable to the claimed causes of action will identify which facts are material. Id. Throughout this analysis, the court must examine the evidence in the light most favorable to the nonmovant and draw all justifiable inferences in its favor. Id. at 255.
Once a party properly makes a summary judgment motion by demonstrating the absence of a genuine issue of material fact, whether or not accompanied by affidavits, the nonmoving party must go beyond the pleadings through the use of affidavits, depositions, answers to interrogatories and admissions on file, and designate specific facts showing there is a genuine issue for trial. Celotex, 477 U.S. at 324. The evidence must be significantly probative to support the claims. Anderson, 477 U.S. at 248-49.
This Court may not decide a genuine factual dispute at the summary judgment stage. Fernandez v. Bankers Nat'l Life Ins. Co., 906 F.2d 559, 564 (11th Cir. 1990). “[I]f factual issues are present, the Court must deny the motion and proceed to trial.” Warrior Tombigbee Transp. Co. v. M/V Nan Fung, 695 F.2d 1294, 1296 (11th Cir. 1983). A dispute about a material fact is genuine and summary judgment is inappropriate if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson, 477 U.S. at 248; Hoffman v. Allied Corp., 912 F.2d 1379, 1383 (11th Cir.1990). However, there must exist a conflict in substantial evidence to pose a jury question. Verbraeken v. Westinghouse Elec. Corp., 881 F.2d 1041, 1045 (11th Cir. 1989).
B. Analysis
Hunter argues that its investigation into Shipley's credit dispute was reasonable as a matter of law. The record evidence, however, is heavily disputed on this issue. First, it is important to remember that the Eleventh Circuit instructs that the reasonableness of the furnisher's investigation is normally an issue for trial. Hinkle, 827 F.3d at 1303 (“When a furnisher reports that disputed information has been verified, the question of whether the furnisher behaved reasonably will turn on whether the furnisher acquired sufficient evidence to support the conclusion that the information was true. This is a factual question, and it will normally be reserved for trial.”).
Second, Hunter's main argument-that Shipley did not provide Hunter with all the information it requested from her, like a police report-was directly addressed by the Eleventh Circuit in Hinkle and disposed of as not being dispositive on the issue of the reasonableness of the furnisher's investigation:
Midland first argues that the act of sending a letter to Hinkle shifted the burden to Hinkle to substantiate her dispute. The letter in question stated that “[a]s part of our investigation ... it would be helpful to have a copy of any documentation you may have that supports your dispute.” Midland argues that when Hinkle failed to support her dispute by sending Midland a police report or a signed fraud affidavit, Midland was entitled to cease its investigation and inform the CRAs that the debts were accurate and had been “verified.” Although the failure to respond to a letter requesting assistance might be relevant to a jury's determination of whether Midland was entitled to report the debt as “verified”-as evidence, for example, that Hinkle's dispute was disingenuous-we are unprepared to say that it is dispositive at summary judgment. Midland cites nothing in the FCRA that permits a furnisher to shift its burden of “reasonable investigation” to the consumer in the case of a § 1681s-2(b) dispute.Id. at 1306.
Shipley also points out in her response that Hunter incentivized its employees to complete as many investigations as possible, which resulted in cursory reviews of disputed accounts. Hunter's corporate representative testified that it was Hunter's policy to process the ACDVs, i.e., automated credit dispute verifications, as quickly as possible. The employees that handled Shipley's dispute processed between 150 and 180 ACDVs per shift. Hendricks' opinion discusses the problems with this type of system, stating:
Defendant's operation of the ACDV-exchange occurred in a hurried, conveyor-belt like atmosphere. This conveyor-belt styled atmosphere is conducive to a dispute operator overlooking, missing or just “whiffing” on important information due to volume, speed or attention issues. This meant that in Plaintiff's case, Defendant failed to review or adequately review or consider quite relevant information, including that which was in its possession or which was readily available to it, which clearly supported Plaintiff's disputes. For example, one of Defendant's ACDV-dispute operators process approximately 150 disputes per day. With a 90-minute lunchbreak in a 9-hour day (7am - 4pm), that comes to approximately 20 disputes per hour - or an average of three minutes for each dispute. [Deposition of Marlenny Gomez, pgs. 13-14.] Another of Defendant's ACDV-dispute operators provide even more troubling details. She testified Defendant's ACDV-dispute operators process 26 E-OSCARs per hour, about 156 per day. Moreover, 50 percent of dispute operators' wages come from a “bonus” for exceeding the quota. A “top performer” processes 180 ACDV-disputes per day.(Dkt. 49-1 at 5).
Hunter's motion for summary judgment is also denied with respect to its argument that it did not cause Shipley any damages. Shipley seeks damages associated with her inability to obtain a mortgage. She also seeks damages related to a car loan that she obtained at a higher interest rate based on the fraudulent rent tradeline. Hunter disputes these damages because there were other derogatory marks on Shipley's credit, but this does not mean that Hunter's derogatory information had no impact on these credit-based decisions. For example, the record reflects that Shipley and her husband were informed that their mortgage preapproval was revoked after they found their “dream home” because of the prior issues with rental properties. Hunter may challenge these damages at trial.
In terms of emotional distress damages, Shipley presented evidence that the ongoing issues involving Hunter's inaccurate reporting permeated her life. She did not qualify for basic, low limit credit cards, lost the pre-approval of her mortgage loan, and was forced to use her parents to co-sign on an apartment lease for her family. Shipley explained that Hunter's conduct caused Shipley to seek therapy and medication to help her handle these issues. Again, at trial Hunter may argue that other factors contributed to Shipley's stress.
Finally, there is a triable issue on whether Hunter acted willfully as contemplated by the FCRA. See Hinkle, 827 F.3d. at 1307 (“But a reasonable jury could find that Midland either knowingly or recklessly reported debts as “verified” without obtaining sufficient documentation to support that determination.”). Shipley contends that Hunter's procedure of providing bonuses to employees for automatically verifying its reporting without first investigating credit bureau disputes is evidence of willfulness. Hunter also disregarded documents that substantiated Shipley's identity theft dispute. Based on this record, the Court cannot rule on this issue as a matter of law. Id. (“A reasonable jury could find that Midland adopted such a system with reckless disregard for the fact that it would result in perfunctory review in contravention of the FCRA. We therefore hold that a reasonable jury could find that Midland willfully violated § 1681s-2(b) when it reported the GE/Meijer and T-Mobile accounts as verified without obtaining sufficient documentation that the debts in fact belonged to Hinkle.”). Hunter's motion for summary judgment is denied in its entirety.
Accordingly, it is ORDERED AND ADJUDGED that:
1. Defendant's Daubert Motion to Exclude Plaintiff's Experts (Dkt. 49) is granted in part and denied in part.
2. Defendant's Motion for Summary Judgment (Dkt. 48) is denied.
DONE and ORDERED.