Boone v. T-Mobile U.S. Inc.

• Decision Date: 26 January 2018
• Docket Number: Civ. No. 17-378-KM-MAH
• Parties: DEAN BOONE, individually and on behalf of all others similarly situated, Plaintiff, v. T-MOBILE USA INC., Defendant.
• Court: U.S. District Court — District of New Jersey

DEAN BOONE, individually and on behalfof all others similarly situated, Plaintiff, v. T-MOBILE USA INC., Defendant.

Civ. No. 17-378-KM-MAH

UNITED STATES DISTRICT COURT FOR THE DISTRICT OP NEW JERSEY

January 26, 2018

OPINION

KEVIN MCNULTY, U.S.D.J.:

Plaintiff Dean Boone ("Boone") alleges that defendant T-Mobile USA Inc. ("T-Mobile") obtained his credit report through a "hard" credit inquiry without his consent. He brings a class action on behalf of himself and all others similarly situated for purported violations of the Fair Credit Reporting Act, 15 U.S.C. § 1681, et seq. ("FCRA") and the New Jersey Fair Credit Reporting Act, N.J. Stat. Ann. 56:11-28, et seq. ("NJ FCRA"). T-Mobile seeks to dismiss Boone's second amended complaint. (ECF no. 33). Boone opposes this motion and seeks leave to submit a third amended complaint. (ECF no. 36). T-Mobile opposes Boone's motion to amend. (ECF no. 39).

I. BACKGROUND¹

A. Factual History

Mr. Boone resides in Mahwah, New Jersey. (2AC ¶ 5). T-Mobile is a corporation that provides telephone and data services throughout the country. (2AC ¶ 6). Boone seeks to certify nationwide and New Jersey classes based on T-Mobile's purported violations of the FCRA and NJ FCRA.

On or about April 21, 2016, Boone went to a T-Mobile store in Paramus, New Jersey, and asked a T-Mobile employee about available cell phone plans and rates. (2AC ¶ 11). Boone made it clear that he did not want his credit report accessed if a "hard" credit inquiry would be required. (2AC ¶ 12). According to Boone, "hard" inquiries result in the disclosure of unauthorized personal information to T-Mobile and also lower the prospective customers' credit scores; "soft" inquiries, by contrast, involve less disclosure of information and do not affect credit scores. (2AC ¶ 21). The employee confirmed that T-Mobile would conduct a soft inquiry and not a hard inquiry. (2AC ¶ 15). Boone did not sign any agreement, did not agree to any services, and did not provide written consent for a hard inquiry. (2AC ¶¶ 16-17). Nonetheless, T-Mobile obtained his credit report through a hard credit inquiry. (2AC ¶ 17).

T-Mobile has "routinely and systematically" obtained such hard inquiries on prospective customers without a permissible purpose or written consent. (2AC ¶ 20). Those prospective customers form the putative classes.

B. Putative Class Action

Boone seeks to represent classes of prospective T-Mobile customers who, like him, were allegedly subject to improper hard credit inquiries. In his second amended complaint, Boone defines two putative classes of putative customers for whom T-Mobile conducted hard inquiries on "false pretenses":

¦ FCRA False Pretense Class: All persons within the United States who had a hard credit inquiry performed on his or her credit by [T-Mobile] who had not previously authorized a hard inquiry within the five years prior to the filing of the Complaint until the date of final judgment in this action. (2AC ¶ 27).

¦ NJ False Pretense Class: All persons within New Jersey who had a hard credit inquiry performed on his or her credit by [T-Mobile] who had not previously authorized a hard inquiry within the five years prior to the filing of the Complaint until the date of final judgment in this action. (2AC ¶ 28).

In his proposed third amended complaint, Boone proposes two additional classes of prospective customers for whom T-Mobile sought hard inquiry credit reports for an "impermissible purpose":

¦ FCRA Impermissible Purpose Class: All persons within the United States who had a hard credit inquiry performed on his or her credit by [T-Mobile,] who had not authorized a hard inquiry, thereby obtaining a persons' credit report without any permissible purpose, within the five years prior to the filing of the Complaint until the date of final judgment in this action. (3AC ¶ 27).

¦ NJ FCRA Impermissible Purpose Class: All persons within New Jersey who had a hard credit inquiry performed on his or her credit by [T-Mobile], who had not authorized a hard inquiry, thereby obtaining apersons' credit report without any permissible purpose, within the five years prior to the filing of the Complaint until the date of final judgment in this action. (3AC ¶ 29).²

As the titles suggest, any FCRA class would seek relief under the federal FCRA, while any NJ FCRA class would seek relief under the NJ FCRA. (2AC ¶¶ 38-51; 3AC ¶¶ 40-53).

C. Procedural History

On January 19, 2017, Boone filed a complaint against T-Mobile in this Court. (ECF no. 1). T-Mobile moved to dismiss the complaint on February 27, 2017. (ECF no 10). On March 17, 2017, Boone filed an amended complaint. (ECF no. 13). T-Mobile moved to dismiss the amended complaint on April 14, 2017. (ECF no. 19).

On June 15, 2017, Boone and T-Mobile attended a scheduling conference before the Honorable Michael A. Hammer. (Pl. Br. 4). At the scheduling conference, T-Mobile consented to Boone's filing a second amended complaint. (Pl. Br. 4).

Boone filed that second amended complaint on June 28, 2017. (ECF no. 31). On July 26, 2017, T-Mobile filed this motion to dismiss the second amended complaint for failure to state a claim and for lack of standing. (ECF no. 33). On August 24, 2017, Boone sought leave to file a third amended complaint. (ECF no. 36). T-Mobile, which this time did not consent (Pl. Br. 4), opposes that motion. (ECF no. 39).

II. LEGAL STANDARDS

A. 12(b)(1) Motion to Dismiss for Lack of Jurisdiction

Motions to dismiss for lack of subject matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1) may be raised at any time. Iwanowa v. Ford Motor Co., 67 F. Supp. 2d 424, 437-38 (D.N.J. 1999). "[B]ecause subjectmatter jurisdiction is non-waivable, courts have an independent obligation to satisfy themselves of jurisdiction if it is in doubt. See Mt. Healthy City Sch. Dist. Bd. of Educ. v. Doyle, 429 U.S. 274, 278 (1977). A necessary corollary is that the court can raise sua sponte subject-matter jurisdiction concerns." Nesbit v. Gears Unlimited, Inc., 347 F.3d 72, 76-77 (3d Cir. 2003).

Rule 12(b)(1) challenges may be either facial or factual attacks. See 2 Moore's Federal Practice § 12.30[4] (3d ed. 2007); Mortensen v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977). A facial challenge asserts that the complaint does not allege sufficient grounds to establish subject matter jurisdiction. Iwanowa, 67 F. Supp. 2d at 438. A court considering such a facial challenge assumes that the allegations in the complaint are true. Cardio-Med. Assoc., Ltd. v. Crozer-Chester Med. Ctr., 721 F.2d 68, 75 (3d Cir. 1983); Iwanowa, 67 F. Supp. 2d at 438. It "review[s] only whether the allegations on the face of the complaint, taken as true, allege facts sufficient to invoke the jurisdiction of the district court." Common Cause of Penn. v. Pennsylvania, 558 F.3d 249, 257 (3d Cir. 2009) (quoting Taliaferro v. Darby Twp. Zoning Bd., 458 F.3d 181, 188 (3d Cir. 2006)).

A factual attack, on the other hand, permits the Court to consider evidence extrinsic to the pleadings. Gould Elecs. Inc. v. United States, 220 F.3d 169, 178 (3d Cir. 2000), holding modified on other grounds by Simon v. United States, 341 F.3d 193 (3d Cir. 2003). Such a factual attack "does not provide plaintiffs the procedural safeguards of Rule 12(b)(6), such as assuming the truth of the plaintiff's allegations." CNA v. United States, 535 F.3d 132, 144 (3d Cir. 2008).

The burden of establishing federal jurisdiction rests with the party asserting its existence. [citing DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 342 n.3 (2006).] "Challenges to subject matter jurisdiction under Rule 12(b)(1) may be facial or factual." [citing Common Cause of Pa. v. Pennsylvania, 558 F.3d 249, 257 (3d Cir. 2009) (quoting Taliaferro v. Darby Twp. Zoning Bd., 458 F.3d 181, 188 (3d Cir. 2006)).] A facial attack "concerns 'an alleged pleading deficiency' whereas a factual attack concerns 'the actual failure of[a plaintiff's] claims to comport [factually] with the jurisdictional prerequisites.'" [citing CNA v. United States, 535 F.3d 132, 139 (3d Cir. 2008) (alterations in original) (quoting United States ex rel. Atkinson v. Pa. Shipbuilding Co., 473 F.3d 506, 514 (3d Cir.2007)).]

"In reviewing a facial attack, the court must only consider the allegations of the complaint and documents referenced therein and attached thereto, in the light most favorable to the plaintiff." [citing Gould Elecs. Inc. v. United States, 220 F.3d 169, 176 (3d Cir. 2000).] By contrast, in reviewing a factual attack, "the court must permit the plaintiff to respond with rebuttal evidence in support of jurisdiction, and the court then decides the jurisdictional issue by weighing the evidence. If there is a dispute of a material fact, the court must conduct a plenary hearing on the contested issues prior to determining jurisdiction." [citing McCann v. Newman Irrevocable Trust, 458 F.3d 281, 290 (3d Cir. 2006) (citations omitted).]

Lincoln Ben. Life Co. v. AEI Life, LLC, 800 F.3d 99, 105 (3d Cir. 2015) (footnotes omitted; case citations in footnotes inserted in text).

Since T-Mobile does not challenge the validity of any of Boone's factual claims as part of its motion, it brings a facial challenge. It argues that the allegations in the operative version of the complaint, even accepted as true, are insufficient to establish Boone's Article III standing, an FCRA claim, or a NJ FCRA claim. In reviewing facial challenges to standing, Courts "apply the same standard as on review of a motion to dismiss under Rule 12(b)(6)." Id.; see In re Horizon Healthcare Servs. Inc. Data Breach Litig., 846 F.3d 625, 632-33 (3d Cir. 2017); Petruska v. Gannon Univ., 462 F.3d 294, 299 n.1 (3d Cir. 2006).

B. 12(b)(6) Motion to Dismiss for Failure to State a Claim

Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint, in whole or in part, if it fails to state a claim upon which relief can be granted. The moving party bears the burden of showing that no claim...