Opinion
C. A. 2:20-cv-2780-BHH-MHC
04-30-2021
Juanita D. Wilson, Plaintiff, v. Wells Fargo Bank, N.A., Defendant.
REPORT AND RECOMMENDATION
MOLLY H. CHERRY UNITED STATES MAGISTRATE JUDGE
Plaintiff, proceeding pro se, filed this action, alleging that Defendant Wells Fargo Bank, NA. ("Wells Fargo") violated her rights under the Fair Credit Reporting Act (FCRA), 15 U.S.C. §§ 1681-1681x. ECF No. 1. Before this Court is a Motion to Dismiss ("Motion") filed by Wells Fargo pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. ECF No. 20. Plaintiff filed her Response in Opposition, ECF No. 23, and Wells Fargo filed a Reply, ECF No. 26. The Motion is ripe for review.
All pretrial proceedings in this case were referred to the undersigned United States Magistrate Judge pursuant to the provisions of 28 U.S.C. § 636(b)(1)(A) and (B) and Local Rule 73.02(B)(2)(g), D.S.C. This Report and Recommendation is entered for review by the District Judge. For the reasons set forth below, the undersigned recommends that the Motion be granted.
The facts, and all inferences therefrom, are construed in the light most favorable to Plaintiff for purposes of ruling on Defendants' Motion to Dismiss. See E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011).
Plaintiff alleges that Wells Fargo "is a national banking association" that "provid[es] personal and commercial banking services." ECF No. 1 at ¶ 3. She further alleges that "Wells Fargo is a 'furnisher' of consumer credit information as that term is used in Section 1681s-2 of the FCRA." Id.
In January 2015, Plaintiff accompanied her daughter to a Wells Fargo branch to be added as co-signer to a Wells Fargo Education Financial Services account. ECF No. 1 at ¶ 5. On January 6, 2015, Plaintiffs daughter obtained an education loan from Wells Fargo in the amount of $12,000, with Plaintiff co-signing the loan. Id. at ¶ 6. In August 2015, Plaintiff co-signed a second education loan with Wells Fargo in the amount of $12,000. Id. at ¶ 7. On March 15, 2019, Plaintiff made a final payment of $2,303.60 on the first loan, id. at ¶ 8, and a final payment of $4,403.30 on the second loan, id. at ¶ 9.
In September 2019, Plaintiff was denied a loan because of negative credit on her credit report. Id. at ¶ 10. According to Plaintiff, she was denied loan opportunities because of false reporting by Wells Fargo. Id. at ¶ 12. Plaintiff alleges that although she had paid both Wells Fargo loans in full, "both the accounts were negatively reported on her credit report," id. at ¶ 11, because Wells Fargo "failed to report Plaintiffs payment of the student education loans to [consumer reporting agencies] and reported incorrect and obsolete information," id. ¶ 27. Plaintiff experienced stress and anxiety "as a result of being denied credit and [a] loan because of the false reporting." Id. at ¶ 13.
Plaintiff alleges that she "specifically advised Experian on numerous occasions that a mistake had been made, provided all necessary information to Experian to support same, and requested the correction of Plaintiff s consumer file." Id. at ¶ 31. Plaintiff alleges that she waited for Wells Fargo to correct the wrong information that had been reported to the consumer reporting agency. Id. at ¶ 12. Plaintiff "trusted and believed that Wells Fargo would properly handle and quickly fix what seemed to be an easy matter to correct, and that her credit report would be updated accordingly by simply reporting correct information about the payments of student education loans to [the consumer reporting agency]." Id. at ¶ 14. However, "Plaintiff began to think that Wells Fargo had not conducted any investigations into her disputes at all, nor cared whether or not they were reporting and disseminating false and highly damaging information about her." Id. at ¶ 16. Plaintiff further alleges that if Wells Fargo conducted any investigations, "such 'investigations' were so shoddy as to allow objectively false and highly damaging information to remain in Plaintiffs credit file." Id. at ¶ 32. Plaintiff claims that she is unable to take advantage of credit opportunities because of the inaccurate reporting, id. at ¶ 19, and states that she has "avoided applying for credit" until the inaccurate information is corrected, id. at ¶ 20.
LEGAL STANDARD
"The purpose of a Rule 12(b)(6) motion is to test the sufficiency of a complaint." Williams v. Preiss-WalPat III, LLC, 17 F.Supp.3d 528, 531 (D.S.C. 2014); see Republican Party of N.C v. Martin, 980 F.2d 943, 952 (4th Cir. 1992) ("A motion to dismiss under Rule 12(b)(6) tests the sufficiency of a complaint; importantly, it does not resolve contests surrounding the facts, the merits of a claim, or the applicability of [affirmative] defenses."). Pursuant to Rule 8 of the Federal Rules of Civil Procedure, a pleading must contain "a short and plain statement of the claim showing that the pleader is entitled to relief," Fed.R.Civ.P. 8(a)(2), such that the defendant will have "fair notice of what the claim is and the grounds upon which it rests," Bell Ail. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotation marks omitted). "[T]he facts alleged 'must be enough to raise a right to relief above the speculative level' and must provide 'enough facts to state a claim to relief that is plausible on its face.'" Robinson v. Am. Honda Motor Co., 551 F.3d 218, 222 (4th Cir. 2009) (quoting Twombly, 550 U.S. at 555, 570). "The plausibility standard is not akin to a 'probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
When considering a Rule 12(b)(6) motion, the court is required to accept the allegations in the pleading as true and draw all reasonable factual inferences in favor of the party opposing the motion. E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011). Moreover, the court must evaluate "the complaint in its entirety, as well as documents attached or incorporated into the complaint." Id. at 448. The court may consider a document not attached to the complaint, so long as the document "was integral to and explicitly relied on in the complaint," and there is no authenticity challenge. Id. (quoting Phillips v. LCI Int'l, Inc., 190 F.3d 609, 618 (4th Cir. 1999)). "A complaint should not be dismissed as long as it provides sufficient detail about the claim to show that the plaintiff has a more-than-conceivable chance of success on the merits." Goldfarb v. Mayor & City Council of Bait, 791 F.3d 500, 511 (4th Cir. 2015) (internal quotation marks and brackets omitted).
Pro se pleadings are given liberal construction and are held to a less stringent standard than formal pleadings drafted by attorneys. Erickson v. Pardus, 551 U.S. 89, 94 (2007). However, principles requiring generous construction of pro se complaints do "not require courts to conjure up questions never squarely presented to them." Beaudett v. City of Hampton, 775 F.2d 1274, 1278 (4th Cir. 1985). Giving liberal construction does not mean that the court can ignore a pro se plaintiffs clear failure to allege facts that set forth a cognizable claim. See Weller v. Dept. o/Soc. Servs., City of Baltimore, 901 F.2d 387, 391 (4th Cir. 1990) ("Only those questions which are squarely presented to a court may properly be addressed."). Thus, even under this less stringent standard, a pro se complaint is still subject to summary dismissal. Estelle, 429 U.S. at 106-07.
DISCUSSION
Plaintiff filed her Complaint on July 30, 2020, alleging two causes of action under the FCRA: (1) a claim that Wells Fargo violated 15 U.S.C. § 1681c by "fail[ing] to report Plaintiffs payment of the student education loans to [consumer reporting agencies] and reporting] incorrect and obsolete information," ECF No.1 at ¶ 27; and (2) a claim that Wells Fargo violated 15 U.S.C. § 1681i(a)(1) by "failing to conduct a reasonable investigation into Plaintiff s disputes," id. at ¶ 33.
Wells Fargo moves to dismiss Plaintiffs Complaint in its entirety for failure to state a claim upon which relief can be granted. ECF No. 20. Upon review of the Complaint and the attachments thereto, the undersigned agrees that the Complaint should be dismissed pursuant to Rule 12(b)(6) for failure to state a claim.
Plaintiff references three exhibits in her Complaint, Exhibits A-C. ECF No. 1 at 4 (noting that Exhibit A is a copy of a check in the amount of $2,303.60, Exhibit B is a copy of a check in the amount of $4,403.30, and Exhibit C is a copy of Plaintiff s credit report from Experian). She attached Exhibits A and B to her Complaint but failed to attached Exhibit C. See Id. at 5-6. However, she attached her Experian credit report (dated September 9, 2019) to her Response to Wells Fargo's Motion. ECF No. 23-1 at 17-83. Because Plaintiff intended to attach the Experian credit report to her Complaint, and because the Experian credit report was integral to and explicitly relied on in the Complaint, the undersigned has considered that document for purposes of evaluating the Complaint. See Kolon Indus., Inc., 637 F.3d at 440. The undersigned has not, however, considered the remaining documents attached to Plaintiffs Response, which total approximately 203 pages. See ECF Nos. 23-1 at 1-16, 84-107; 23-2; 23-3.
I. The FCRA Framework
The FCRA seeks to "ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy." Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 52 (2007) (citing 15 U.S.C. § 1681). The FCRA "regulates the creation and the use of 'consumer report[s]' by 'consumer reporting agenc[ies]' for certain specified purposes, including credit transactions[.]" Spokeo v. Robins, 136 S.Ct. 1540, 1545 (2016) (citing 15 U.S.C. §§ 1681a(d)(1)(A)-(C) and 1681b). "To achieve its purpose, the FCRA places distinct obligations on three types of entities: consumer reporting agencies, users of consumer reports, and furnishers of information to consumer reporting agencies." Chipka v. Bank of America, 355 Fed.Appx. 380, 382 (11th Cir. 2009) (citing 15 U.S.C. §§ 1681b, 1681m, and 1681s-2); see Branch v. Fed. Home LoanMortg., No. 5:04-CV-859-BO, 2005 WL 8159344, at *3 (E.D. N.C. July 28, 2005).
The FCRA defines a consumer reporting agency as "any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports." 15 U.S.C. § 1681a(f). Although the FCRA does not define "furnisher" of information, "the term is understood as including any entity . . . that provides information about its customers to credit reporting agencies (CRAs), including information about a customer's payments on their accounts." Saunders v. Equifax Info. Servs., L.L.C., No. 3:05 CV 731, 2006 WL 2850647, at *1 (E.D. Va. Oct. 3, 2006), aff'dsub nom. Saunders v. Branch Banking & Tr. Co. of VA, 526 F.3d 142 (4th Cir. 2008).
"The term 'consumer report' means any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer's eligibility for (A) credit or insurance . . .; (B) employment purposes; or (C) and other purpose authorized under section 1681b of this title." 15 U.S.C. § 1681a(d)(1).
II. Plaintiff has failed to state a claim under Sections 1681c and 1681i of the FCRA.
Sections 1681c and 1681i of the FCRA apply only to consumer reporting agencies. See 15 U.S.C. § 1681c ("Except as authorized under subsection (b), no consumer reporting agency may make any consumer report containing the following items of information . . . .") (emphasis added); 15 U.S.C. § 1681i(a)(1) ("[I]f the completeness or accuracy of any item of information contained in a consumer's file at a consumer reporting agency is disputed by the consumer ... the agency shall . . . conduct a reasonable investigation to determine whether the disputed information is inaccurate ... or delete the item from the file.") (emphasis added). As such, courts routinely dismiss claims pursuant to §§ 1681c and 168 li alleged against defendants that are not consumer reporting agencies. See, e.g., Rich v. Stern & Assocs., P.A., No. 3:15CV451, 2016 WL 4480695, at *1 (W.D. N.C. Aug. 24, 2016) ("As [defendant furnisher's] duties pursuant to the FCRA are limited to § 1681s-2, Plaintiffs claims pursuant to §§ 1681b, 1681c, and 1681i must be dismissed."); Craighead v. Nissan Motor Acceptance Corp., 2010 U.S. Dist. LEXIS 132123, *13 (E.D. Va. Dec. 14, 2010) ("As to Plaintiffs claim pursuant to section 1681i(a)(1), that section applies to credit reporting agencies, not furnishers of information, such as Defendant.").
In this case, the Complaint does not allege that Wells Fargo is a consumer reporting agency. To the contrary, the Complaint expressly alleges that Wells Fargo is a "furnisher" under the FCRA. ECF No. 1 at ¶¶ 3, 24. In her Response, Plaintiff argues that in addition to being a furnisher, Well Fargo also is a credit reporting agency. ECF No. 23 at 2-3. However, the facts alleged in the Complaint do not support an inference that Wells Fargo is a consumer reporting agency or was acting as a consumer reporting agency when it reported information about Plaintiffs education loan payments. See 15 U.S.C. § 1681a(d)(2)(A)(i) (excluding from the definition of "consumer report" any "report containing information solely as to transactions or experiences between the consumer and the person making the report"); Smith v. First Nat'l Bank of Atlanta, 837 F.2d 1575, 1578 (11th Cir. 1988) (holding that a bank reporting information solely on its own experience with one of its customers was not acting as a "consumer reporting agency" within the meaning of the FCRA because it has not furnished a "consumer report" as that term is defined in the Act). Thus, because Sections 1681c and 1681i do not apply to a furnisher such as Wells Fargo, Plaintiff has failed to state a claim under these sections upon which relief can be granted.
III. Plaintiff has failed to state a claim under Section 1681s-2(b) of the FCRA.
The Complaint, liberally construed, may be attempting to assert a claim under Section 1681s-2(b) of the FCRA, which relates to furnishers of information. So construed, the Complaint still fails to state a plausible claim.
The FCRA provides no "private right of action for a credit furnisher's alleged failure to report accurate information." Harrell v. Caliber Home Loans, Inc., 995 F.Supp.2d 548, 554 n.4 (E.D. Va. 2014) (citation omitted). However, there is a private cause of action under § 1681s-2(b), which imposes duties on furnishers, upon receiving a dispute of accuracy from a consumer reporting agency, to conduct a reasonable investigation of the dispute, report its results to the consumer reporting agency, and modify or delete incorrect information. See Akalwadi v. Risk Mgmt. Alternatives, Inc., 336 F.Supp.2d 492, 509 (D. Md. 2004); see also 15 U.S.C. § 1681s-2(b); White v. Fannie Mae, No. CIV. A. 1:13-29923, 2014 WL 5442970, at *6 n.4 (S.D. W.Va. Oct. 24, 2014).
To prevail on a claim under § 1681s-2(b), a plaintiff must demonstrate that (1) she notified a consumer reporting agency of the disputed information, (2) the consumer reporting agency notified the furnisher of the dispute, and (3) the furnisher failed to investigate and modify the inaccurate information. See Alston v. Branch Banking & Tr. Co., No. GJH-15-3100, 2016 WL 4521651, at *6 (D. Md. Aug. 26, 2016); see alsoHobackv. Synchrony Bank, No. 6:19-cv-18, 2019 WL 2438794, at *2 (W.D. Va. June 11, 2019) ("The private right of action available to a consumer under the FCRA arises under § 1681s-2(b) once that consumer disputes incorrect information with a [consumer reporting agency] and that [consumer reporting agency ] informs the furnisher.") (emphasis added). As the Fourth Circuit has explained, "a furnisher's duty to investigate is not triggered until it receives notification of a dispute from a consumer reporting agency." Mavilla v. Absolute Collection Serv., Inc., 539 Fed.Appx. 202, 208 (4th Cir. 2013) (citing 15 U.S.C. § 1681s-2(b)(1)); Staffordv. Cross Country Bank, 262 F.Supp.2d 776, 784 (W.D. Ky. 2003) ("This means that a furnisher of credit information, such as the Bank, has no responsibility to investigate a credit dispute until after it receives notice from a consumer reporting agency.") (emphasis in original)).
Here, although Plaintiff alleges that she "specifically advised Experian on numerous occasions that a mistake had been made, provided all necessary information to Experian to support same, and requested the correction of Plaintiff s consumer file," Compl. at ¶ 31, Plaintiff does not allege any facts showing that Wells Fargo received notice of a dispute from Experian or any other consumer reporting agency, such as to establish the second prong of a § 1681s-2(b) claim. Thus, there is no allegation from which to infer that Wells Fargo's duties under § 1681s-2(b) were ever triggered. See Mavilla, 539 Fed.Appx. at 208. Therefore, the undersigned finds that Plaintiff has failed to state a claim under § 1681s-2(b) upon which relief can be granted.
Plaintiff asserts in her Response that she "initiated a dispute with Wells Fargo and was unsuccessful," and she suggests that this notice was sufficient to satisfy the notice requirement of a 1681s-2(b) claim because, she argues, Wells Fargo is a consumer reporting agency. ECF No. 23 at 4. As explained above, however, the facts alleged in the Complaint are not sufficient to allege that Wells Fargo is a consumer reporting agency. Moreover, notice of a dispute given by a consumer directly to the furnisher is not sufficient to trigger the furnisher's statutory duties under § 1681s-2(b). See 15 U.S.C. § 1681s-2(b)(1); Chiang v. MBNA, 620 F.3d 30, 30-32 (1st Cir. 2010) (finding a notice of disputed information provided directly by a consumer to a furnisher does not trigger a furnisher's investigation duties under the FCRA); Blick v. Wells Fargo Bank, N.A., No. 3:11-CV-00081, 2012 WL 1030137, at *9 (W.D. Va. Mar. 27, 2012) (dismissing FCRA claim where Complaint failed to allege that furnisher-defendant received notification from a credit reporting agency regarding plaintiffs' dispute), qff'd, 474 Fed.Appx. 932 (4th Cir. 2012).
Finally, Plaintiff argues in her Response that after she notified Experian of the disputed information, Wells Fargo was then notified by Experian of the dispute. ECF No. 23 at 5. However, this is a new allegation that does not appear in her Complaint and cannot be considered for purposes of ruling on the Motion. See Deas v. Prudential Ins. of Am., No. 2:17-CV-03016-DCN, 2018 WL 1993869, at *3 (D.S.C. Apr. 26, 2018) ("The court cannot consider these arguments on a motion to dismiss if they or the facts upon which they are based were not raised in the complaint[.]"); Chewning v. Ford Motor Co., 35 F.Supp.2d 487, 488 (D.S.C. 1998) ("It is also well-settled that a complaint cannot be amended by plaintiffs briefs in opposition to a motion to dismiss.") (citing Mylan Laboratories, Inc. v. Akzo, N.V., 770 F.Supp. 1053, 1068 (D. Md. 1991)).
After accepting the allegations in the Complaint as true and drawing all reasonable factual inferences from those allegations in favor of Plaintiff, the undersigned concludes that Plaintiff has failed to plead facts sufficient to state a claim under the FCRA upon which relief can be granted. Accordingly, the undersigned recommends that Plaintiffs Complaint be dismissed without prejudice.
Although Wells Fargo seeks dismissal with prejudice, the undersigned recommends dismissal without prejudice to afford Plaintiff an opportunity to amend her complaint. See Fed. R. Civ. P. 15(a) (leave to amend should be freely given when justice so requires); Deas, 2018 WL 1993869, at *3 (granting in part defendant's motion to dismiss and dismissing the case without prejudice, allowing plaintiff the opportunity to re-file her claim with a complaint that fully incorporates the facts and arguments she raises in her response to the motion to dismiss).
CONCLUSION
For the reasons set forth above, it is RECOMMENDED that Wells Fargo's Motion to Dismiss (ECF No. 20) be GRANTED with leave to amend her FCRA claim. The parties are referred to the Notice Page attached hereto.