A District Court judge in Pennsylvania has granted a defendant’s motion to dismiss a Fair Credit Reporting Act lawsuit, ruling that the plaintiff’s own allegations established the defendant conducted the very investigation she accused it of skipping.
The background: Last fall, the plaintiff obtained an automobile loan from a lender, which furnished information about the account to a credit reporting agency.
- The plaintiff noticed what she believed were errors in how the account was being reported and disputed the reporting. The lender verified the information as accurate. She disputed the reporting a second time, and the lender again verified it. At no point was the account marked as disputed.
- In December, the plaintiff filed suit in state court, alleging that both the credit reporting agency and the lender violated the FCRA. The defendants removed the case to federal court in early January, and the credit reporting agency settled, leaving only the claim against the lender.
- The lender argued the complaint offered nothing but legal conclusions without any supporting facts, and noted that its counsel twice asked before filing its motion whether the plaintiff wished to amend her complaint. She declined both times.
- One paragraph of the complaint referred to the defendant as “GLS,” a company that is not a party to the case, and referred to the plaintiff as “he,” leading the judge to conclude the paragraph was copied and pasted from another brief.
The ruling: Judge Gail A. Weilheimer of the District Court for the Eastern District of Pennsylvania granted the motion and dismissed the complaint with prejudice.
- Judge Weilheimer wrote that the allegations were circular: the plaintiff claimed the lender failed to investigate her dispute while simultaneously admitting the lender verified the disputed information as accurate, twice. Nothing in the complaint suggested the investigation was unreasonable. “The statute does not require the furnisher to agree with Plaintiff,” the judge wrote. “The furnisher’s obligation is to investigate and promptly report its findings, which, according to Plaintiff, it did.”
- The judge noted a furnisher’s duty to mark an account as disputed arises only when a dispute is potentially meritorious, meaning it identifies material inaccuracies. The complaint never identified a single inaccuracy in the reporting.
- Claims that the lender furnished false information in the first place failed as a matter of law, because consumers cannot privately sue furnishers over conduct that occurred before a credit reporting agency forwards a dispute.
- Attaching the word “willfully” to conclusory allegations was not enough to support statutory or punitive damages.
- Amending the complaint would be futile, the judge wrote, because stating a claim would require the plaintiff to completely reverse facts she had already pled. “This Court is unwilling to diminish our justice system by endorsing an action that would clearly encourage anything less than complete candor.”
