A District Court judge in Delaware has granted a defendant’s motion to dismiss a lawsuit claiming it violated the Fair Credit Reporting Act and the Fair Debt Collection Practices Act while also denying the plaintiff’s motion to remand the case back to state court, pointing out a number of deficiencies in the plaintiff’s filing. The ruling reinforces that cases asserting only federal claims belong in federal court, even when plaintiffs attempt to argue that state law issues are in play.
The background: The plaintiff filed the lawsuit in Delaware state court, alleging that the defendant attempted to collect a debt without proper validation and violated both the FDCPA and the FCRA in how a tradeline was reported to consumer reporting agencies.
- According to the complaint, the plaintiff sent a dispute and validation demand related to a reported account and claimed the defendant failed to adequately validate the debt or provide documentation.
- The plaintiff also alleged that the reporting activity interfered with a pending mortgage application and sought damages as well as deletion of the tradeline from credit reports.
- The defendant removed the case to federal court and moved to dismiss the complaint. The plaintiff, in turn, asked the court to send the case back to state court, arguing the removal was improper and that state law protections were implicated.
The ruling: Judge Maryellen Noreika of the District Court for the District of Delaware found that the complaint failed to state a plausible claim under either statute.
- On the FDCPA claims, the judge noted that the plaintiff did not allege facts showing the defendant was acting as a debt collector under the statute, did not plead how validation was improper, and did not describe any specific prohibited collection conduct.
- On the FCRA claims, Judge Noreika pointed out that the complaint did not allege what information was inaccurate, why it was inaccurate, or when the plaintiff discovered the alleged inaccuracy. As the judge put it, the allegations were “deficient, and no violation of the FDCPA or the FCRA can be reasonably inferred without more.”
- The judge also rejected the attempt to remand the case to state court, noting that the complaint asserted only federal FDCPA and FCRA claims and did not actually plead any state law causes of action.
- The case was dismissed, though the plaintiff was given an opportunity to amend the complaint to try to cure the deficiencies.
