Lockard v. Equifax, Inc.

• Decision Date: 31 December 1998
• Docket Number: No. 97-8023,97-8023
• Citation: 163 F.3d 1259
• Parties: 12 Fla. L. Weekly Fed. C 348 William D. LOCKARD, Plaintiff-Appellant, v. EQUIFAX, INC., a Georgia Corporation, et al., Defendants, Baton Rouge General Medical Center, a Louisiana Corporation; Baton Rouge General Health Center, a Louisiana Corporation; Patient Financial Services, Inc., A Louisiana Corporation; Southern Credit Recovery, a Louisiana Corporation, Defendants-Appellees.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1259

163 F.3d 1259

12 Fla. L. Weekly Fed. C 348

William D. LOCKARD, Plaintiff-Appellant, v. EQUIFAX, INC., a Georgia Corporation, et al., Defendants,

Baton Rouge General Medical Center, a Louisiana Corporation;

Baton Rouge General Health Center, a Louisiana Corporation;

Patient Financial Services, Inc., A Louisiana Corporation;

Southern Credit Recovery, a Louisiana Corporation,

Defendants-Appellees.

No. 97-8023.

United States Court of Appeals,

Eleventh Circuit.

Dec. 31, 1998.

Bruce McCord Edenfield, Hicks, Maloof & Campbell, Atlanta, GA, L. Hunter Compton, Jr., Dominick, Fletcher, Yielding, Wood & Lloyd, Birmingham, AL, Neal P. Connor, Decatur, AL, H.J. Ferguson, Jr., Ferguson, Frost & Dodson, LLP, Birmingham AL, for Plaintiff-Appellant.

Marc S. Sacks, Kilpatrick Stockton, LLP, Atlanta, GA, for Equifax, Inc.

Thomas E. McCarter, Atlanta, GA, for Certified Bureau.

Donna Potts Bergeson, Hilary E. Buckley, Alston & Bird, Atlanta, GA, for Baton Rouge General Medical Ctr., Baton Rouge General Health Ctr., and Patient Financial Services, Inc.

Henry E. Scrudder, Jr., Tiffany Taylor Norman, Goldner, Sommers, Scrudder & Bass, Atlanta, GA, for Southern Credit.

Appeal from the United States District Court for the Northern District of Georgia.

Before EDMONDSON and HULL, Circuit Judges, and CLARK, Senior Circuit Judge.

CLARK, Senior Circuit Judge:

In this case, plaintiff-appellant William D. Lockard alleged that he was denied credit

because of outstanding debts on his credit report that he did not owe. He brought this suit in state court under the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681, and state law causes of action against numerous defendants. The defendants removed the case to federal district court, and the district court denied Lockard's motion to remand. The district court also denied Lockard's motion to amend his complaint against two of the defendants, denied his motion to transfer the case to Louisiana, and dismissed some of the defendants for lack of personal jurisdiction. The district court issued a final order pursuant to Federal Rule of Civil Procedure 54(b) for the dismissed defendants. Lockard raises four issues on appeal: the denial of his motion to remand, the denial of his motion to amend the complaint, the denial of his motion to transfer, and the dismissal of the defendants for lack of personal jurisdiction. We dismiss the appeal of the denial of the motion to amend the complaint for lack of jurisdiction, and affirm the district court's ruling on the other three issues.

FACTS

Lockard's wife was admitted to the Baton Rouge General Medical Center (BR Medical) twice for treatment in 1992. At the time of both admissions, Lockard and his wife were married but separated. For both admissions, Mrs. Lockard used her husband's insurance policy provided by Blue Cross/Blue Shield of Massachusetts (Blue Cross). Blue Cross paid the portions for which it was responsible, leaving balances of $1,523.75 for the first admission and $1,117.46 for the second.

When the first balance was not paid, BR Medical turned the account over to Southern Credit Recovery, Inc. (Southern Credit) for collection as a bad debt, listing appellant as the responsible party. Southern Credit mailed a computer tape containing information about this debt to Equifax, Inc. (Equifax) in Georgia. Months later, appellant sent Southern Credit a letter of dispute, stating he was not responsible for the debt. Southern Credit notified General Health Systems, Inc. (General Health), BR Medical's owner, about appellant's letter. General Health claimed that appellant was removed as the responsible party for the first balance.

When the second balance was not paid, BR Medical turned the account over to Certified Bureau of the South (Certified Bureau) for collection as a bad debt, again listing appellant as the responsible party. Lockard notified Certified Bureau that he was not responsible for the debt, and Certified Bureau claimed that it contacted Baton Rouge General Health Center (BR Health) about the dispute, received authorization to remove appellant as the responsible party, and informed the Credit Bureau of Baton Rouge, Inc. of the change. General Health, however, states that it knew nothing about the second account until this lawsuit.

In 1993, appellant's son was treated at Southwest Mississippi Regional Medical Center (SW Medical), and provided insurance information under appellant's Blue Cross policy. A dispute exists as to whether the son listed himself or appellant as the guarantor of payment, but after Blue Cross paid its portion, there was a balance of $64.01 which was not paid. The account was turned over to the Southwest Mississippi Regional Credit Services for collection.

Appellant brought this action in a Georgia state court seeking a permanent injunction and damages under the FCRA, and alleged various state law claims. He brought suit under the FCRA against Equifax, Equifax Credit Information Services (ECIS), and Certified Bureau, and brought state law claims of defamation, intentional infliction of emotional distress, invasion of privacy, negligence, and outrage against BR Medical, BR Health, Patient Financial Services, SW Medical, and Southern Credit. The defendants filed a joint notice of removal on the basis of federal question jurisdiction pursuant to 28 U.S.C. § 1441(b)-(c). After the defendants removed the case to federal court and filed motions to dismiss the complaint, appellant filed motions for abstention and remand, and a motion to amend the complaint.

The district court dismissed defendants SW Medical, BR Medical, BR Health, Patient Financial Services, Certified Bureau, and Southern Credit for lack of personal jurisdiction. The district court found that these defendants were not located in Georgia, were not registered or qualified to do business in Georgia, had never attempted to do business in Georgia including advertising or soliciting patients, and none owned, used, or possessed any real property in Georgia. None of the actions involving any of these defendants occurred in Georgia. Although Certified Bureau sent two letters to appellant's son in Georgia, and Southern Credit sent the computer tape to Equifax at an address in Georgia, the district court found that these contacts were too tenuous to satisfy the requirements of due process.

The district court also denied appellant's motion to amend the complaint to add two state law claims against Equifax and ECIS. The district court found that appellant had not offered an adequate explanation about his failure to comply with the planning report filed with the court, which provided that amendments to the pleadings should have been filed within 30 days of the planning report. The district court further noted the dismissal of the other defendants. The claims against Equifax and ECIS are outstanding; the district court certified the dismissal of BR Medical, BR Health, and Patient Financial Services pursuant to Fed.R.Civ.P. 54(b).

DISCUSSION

In his brief to this court, appellant concedes the dismissal of defendants BR Health and Patient Financial Services, and does not contest the district court's dismissal of Certified Bureau or SW Medical. Therefore, only appellant's claims against Equifax, ECIS, BR Medical, and Southern Credit are part of this appeal.

Denial of motion to remand

Appellant argues that the jurisdiction statement in the FCRA prohibits removal, and that his federal claims are intertwined with state law claims which are more appropriate for decision in a state court. Appellees contend that the statute allows a plaintiff a choice of forum but does not preclude removal, and that the presence of state law claims is not dispositive. Because the question is purely one of law, this court reviews de novo the district court's denial of a motion to remand. ¹

The subsection of the FCRA referencing jurisdiction reads as follows:

An action to enforce any liability created under this subchapter may be brought in any appropriate United States district court without regard to the amount in controversy, or in any other court of competent jurisdiction.... ²

An action brought in a state court can be removed to federal court under 28 U.S.C. § 1441(a) when a federal district court also has original jurisdiction unless Congress has expressly prohibited removal. ³ There are not many such prohibitions, and when Congress has decided that justifications exist to prohibit removal, it has made the prohibition clear by unambiguous language in the statute. ⁴

The issue here is whether Congress intended such a removal exception in § 1681p. There is no case law from any Circuit court on this issue. There are numerous The leading district court case finding that removal of FCRA cases is prohibited relied on cases interpreting similar language in the Fair Labor Standards Act ⁸ (FLSA) as a removal prohibition. However, only one Circuit court has issued an opinion as to whether Congress intended to prohibit removal of cases brought under the FLSA, and district courts are divided on the issue. ⁹

                district court decisions, but they are split.  Some district courts have held that removal to federal court is prohibited, 5 while other district courts have found that the plain language of the statute allows plaintiffs to initiate an action in state court but does not guarantee that they may keep it there. 6  We agree with the reasoning outlined in Haun v. Retail Credit Co. 7  concluding that the language in the FCRA does not provide evidence that Congress intended to preclude removal
                

Moreover, there is a difference in the language of the jurisdiction provisions of the FLSA and the FCRA. The FLSA states that a plaintiff can "maintain" an action in any other court of competent jurisdiction, whereas the FCRA states that suit "may be brought" in any other court of competent jurisdiction. This minor difference in language translates to more than a minor difference in...