A District Court judge in Virginia has granted a defendant’s motion to dismiss claims it violated the Fair Credit Reporting Act and the Fair Debt Collection Practices Act over how a debt was being reported to the credit reporting agencies, concluding the plaintiff failed to allege sufficient facts to support any of the violations he asserted.
The background: The plaintiff accused the defendant, a debt collection company, of inaccurately reporting a charged-off account to a credit reporting agency and failing to investigate disputes regarding the debt. He claimed the account was “inaccurate, unverifiable, and incomplete” and said he submitted multiple disputes, including a written validation request and a complaint through the Consumer Financial Protection Bureau’s consumer complaint portal.
- He also alleged that when he later called the defendant, a representative told him the company’s internal system listed him as “deceased,” which he argued caused further damage to his credit and emotional distress.
- The plaintiff filed suit under several provisions of the FCRA and FDCPA, asserting the defendant failed to conduct a reasonable investigation into his dispute, improperly continued collection activity, and made false or misleading representations in connection with collecting the debt.
The ruling: Judge Norman K. Moon of the District Court for the Western District of Virginia dismissed all claims with prejudice, finding the plaintiff’s allegations conclusory and unsupported by facts required to state a viable claim.
- On the FCRA claim, Judge Moon noted that to sue a furnisher under section 1681s-2(b), a plaintiff must allege that a credit reporting agency notified the furnisher of the dispute. The complaint did not allege this. Instead, the plaintiff claimed he notified the defendant directly through a validation request and a CFPB complaint. The judge wrote that this “misunderstands the statute,” explaining that notice must come from a consumer reporting agency, not the consumer. Because the plaintiff failed to plead this essential element, the FCRA claim failed.
- The Court also rejected the FDCPA validation claim because the plaintiff did not allege he disputed the debt within the 30-day statutory period. Without a timely dispute, the defendant had no duty to verify the debt. The judge further noted that according to the plaintiff’s own exhibits, the defendant ceased communication and returned the account to the creditor once his dispute was received.
- The plaintiff’s FDCPA misrepresentation claim also fell short. Although the plaintiff argued that being told he was marked “deceased” violated section 1692e, the Court held that he did not allege the statement was made in connection with attempting to collect a debt. Even more, the Court found that the “least sophisticated consumer” could not reasonably be misled into believing he was actually dead, remarking that the standard protects naïve consumers but not those who make “bizarre or idiosyncratic interpretations.”
