Wright v. Experian Info. Solutions, Inc.

• Decision Date: 10 November 2015
• Docket Number: No. 14–1371.,14–1371.
• Citation: 805 F.3d 1232
• Parties: Gary A. WRIGHT, Plaintiff–Appellant, v. EXPERIAN INFORMATION SOLUTIONS, INC.; Trans Union LLC, Defendants–Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

805 F.3d 1232

Gary A. WRIGHT, Plaintiff–Appellant

v.EXPERIAN INFORMATION SOLUTIONS, INC.; Trans Union LLC, Defendants–Appellees.

No. 14–1371.

United States Court of Appeals, Tenth Circuit.

Nov. 10, 2015.

Peter R. Bornstein, Law Offices of Peter Bornstein, Greenwood Village, CO, appearing for Plaintiff–Appellant.

Nathaniel P. Garrett (Meghan E. Sweeney, with him on the brief), Jones Day, San Francisco, CA, appearing for Appellee Experian Information Solutions, Inc.

Martin E. Thornthwaite (Paul L. Myers, with him on the brief), Strasburger & Price, LLP, Frisco, TX, appearing for Appellee Trans Union LLC.

Before BRISCOE, MATHESON, and BACHARACH, Circuit Judges.

Opinion

MATHESON, Circuit Judge.

On May 27, 2009, the Internal Revenue Service (“IRS”) filed a notice of federal tax lien (“NFTL”) with the Pitkin County Recorder (the “Recorder”) in Colorado listing as name of taxpayer:

Attorneys Title Insurance Agency of

Wright Gary A Member

On May 8, 2009, Mr. Wright had sent a check to the IRS for the unpaid employment taxes underlying the lien.

The Recorder listed the lien on its indexing website as against Gary A. Wright in his personal capacity. Credit reporting agencies (“CRAs”) Experian Information Services, Inc. (“Experian”) and Trans Union LLC (“Trans Union”) received this information about the lien from their contractor, LexisNexis, and included it in their reports of Mr. Wright's credit history.

In 2011, Mr. Wright learned about the lien appearing in his credit reports. He sent letters to the CRAs disputing the lien, asserting (1) the IRS had withdrawn the lien because the taxes had subsequently been paid, and (2) the NFTL inaccurately stated the lien was assessed against him when it should have been assessed only against Attorneys Title Insurance Agency of Aspen (“ATA”). In response to these letters, the CRAs checked the information provided by Mr. Wright with LexisNexis and listed the lien on his credit report as released because it had been paid in full. The CRAs did not remove the lien entirely from Mr. Wright's credit report because the IRS treated it as released rather than withdrawn.

Mr. Wright brought suit in the district court under the Fair Credit Reporting Act (“FCRA”) and Colorado Consumer Credit Reporting Act (“CCCRA”), claiming the credit reports were inaccurate, the CRAs acted unreasonably in reporting the lien and responding to his letters, and the foregoing caused him to suffer damages.

The district court granted summary judgment to the CRAs, concluding they used reasonable procedures to prepare Mr. Wright's credit report and to reinvestigate in response to Mr. Wright's letters.

Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.

I. BACKGROUND

A. Factual History

1. The IRS Issued an NFTL Naming Mr. Wright and ATA, and Pitkin County Recorded It

On April 9, 2007, the IRS assessed $726.83 for ATA's nonpayment of its 2004 employment taxes. On May 27, 2009, the IRS filed the following NFTL with the Recorder:

Aplt. App. at 504.

ATA is a Colorado limited liability corporation that provides title insurance for real estate transactions. Mr. Wright is the manager, attorney, and registered agent for ATA.¹

The NFTL indicates the lien was for nonpayment of Form 941 employment taxes. Under “Residence,” the NFTL lists ATA's business address. It also lists only ATA's taxpayer identification number. After receiving the NFTL, the Recorder indexed the lien on its website as imposed against Mr. Wright in his individual capacity.

The IRS apparently informed Mr. Wright of the NFTL because on September 10, 2009, Mr. Wright sent a letter and an application to the IRS to withdraw the NFTL. In this letter, Mr. Wright stated he paid the taxes in full by a check dated May 8, 2009, before the NFTL was filed. On December 15, 2010, the IRS released the lien, but it did not withdraw it. A withdrawal would have required the IRS to erase the NFTL, “as if the withdrawn notice had not been filed,” and notify the CRAs of the erasure. 26 U.S.C. § 6323(j) ; see also 26 C.F.R. § 301.6323(j)–1. A release does not require either. See id. ; 15 U.S.C. § 1681c(a)(3) ; 26 C.F.R. § 301.6325–1.²

2. The CRAs Reported the Tax Lien, Mr. Wright Discovered the Report in 2011 and Disputed it in 2012, and the CRAs Reinvestigated and Revised the Report

On August, 26, 2009, LexisNexis, a contractor employed by CRAs Experian and Trans Union, collected the tax lien information from the Recorder's website and reported it to the CRAs. The CRAs included the lien in their reports of Mr. Wright's credit history.

In 2011, when Mr. Wright tried to refinance his home mortgage, he first became aware that his credit reports included reference to the tax lien. In July 2012, Mr. Wright sent a letter to the CRAs disputing their reports of the lien. He asserted the lien had been paid in full and the CRAs incorrectly attributed the lien to him in his personal capacity and should have attributed it only to ATA. Mr. Wright included with this letter the following documentation: a copy of the NFTL, his September 10, 2009 letter and application to the IRS for withdrawal of the lien, and the IRS's release of the lien.

Experian sent a description of Mr. Wright's dispute to LexisNexis. LexisNexis responded that the NFTL listed Mr. Wright as one of the taxpayers and updated the lien to “satisfied/released” based on the documentation Mr. Wright provided. Aplee. Supp. App. at 161. Trans Union sent the letter to a different contractor, Intelenet, which determined Mr. Wright's credit report should be updated to reflect a “Paid Federal Tax Lien.” Aplt. App. at 323. Neither CRA removed the lien from its report, but they changed their reports to show the lien had been released. They also sent Mr. Wright summaries of the results of their investigations. The summaries stated that if Mr. Wright disagreed with the results, he could add a statement to his credit report disputing its accuracy or contact the furnisher of the information, apparently the IRS.

In September 2012, Mr. Wright sent a second letter to the CRAs requesting them to remove the lien from his reports. He attached the same documentation as before. Experian did not perform a second investigation. It determined, based on LexisNexis's earlier investigation, that the lien against Mr. Wright was accurately reported. Experian sent a response to Mr. Wright suggesting he contact the furnisher of the information, apparently the IRS.

Trans Union requested LexisNexis to review the documentation. When LexisNexis reported the same result that Intelenet reached, Trans Union sent a summary of the investigation to Mr. Wright.

B. Procedural History

In December 2012, Mr. Wright sued the CRAs in federal district court, alleging negligent and willful violations of the FCRA and CCCRA. Mr. Wright alleged the NFTL showed the IRS imposed the tax lien only against ATA. He asserted claims against the CRAs under 15 U.S.C. § 1681e(b) and Colo.Rev.Stat. § 12–14.3–103.5 for failing to follow reasonable procedures to assure maximum possible accuracy in preparing the credit report that showed the lien was imposed against him. [Aplt. App. at 16.] He also asserted a claim under 15 U.S.C. § 1681i(a)(1) and Colo.Rev.Stat. § 12–14.3–106 for failing to reasonably reinvestigate his dispute.³ The FCRA uses the term “dispute” to describe a consumer's challenge to the accuracy of the information CRAs include in a credit report. See 15 U.S.C. § 1681i(a)(1). Mr. Wright also alleged he suffered economic damages and emotional distress.

The district court granted summary judgment to the CRAs, finding it “was reasonable to interpret the NFTL as extending to Plaintiff” and that the IRS “can issue [a tax lien] against both a business entity and its member.” Aplt. App. at 1397–98. The court held the CRAs' initial reporting of the lien and their reinvestigation into the dispute were both reasonable because “no additional procedure implemented by Defendants would have allowed them to more accurately determine the scope of the NFTL....” Aplt. App. at 1397.

II. DISCUSSION

Mr. Wright appeals, contending the district court should not have granted summary judgment to the CRAs because he raised genuine issues of material fact about the accuracy of the tax lien information on the reports and the reasonableness of the CRAs' procedures in reporting and reinvestigating this information. We affirm the district court's determination that Mr. Wright could not establish the CRAs employed unreasonable procedures in reporting and reinvestigating the tax lien information.

A. Standard of Review

“We review a district court's decision to grant summary judgment de novo, applying the same standard as the district court.” Lundstrom v. Romero, 616 F.3d 1108, 1118 (10th Cir.2010) (quotations omitted). Summary judgment is appropriate if “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “When applying this standard, we view the evidence and draw reasonable inferences therefrom in the light most favorable to the nonmoving party.” Doe v. City of Albuquerque, 667 F.3d 1111, 1122 (10th Cir.2012) (quotations omitted).

B. Reasonable Procedures under 15 U.S.C. § 1681e(b) and Colo.Rev.Stat. § 12–14.3–103.5

Mr. Wright's first claim is that the CRAs failed to use reasonable procedures in reporting the tax lien information in the first instance. Based on the legal requirements of the FCRA and CCCRA, we conclude the district court properly granted summary judgment on this issue.

1. Legal Background

The FCRA and the CCCRA require CRAs to employ reasonable procedures in preparing credit reports.

When CRAs initially report information, 15 U.S.C. § 1681e(b) requires:

Whenever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates.

Colo.Rev.Stat. § 12–14.3–103.5 similarly requires:

Whenever a consumer reporting agency

...