Bracken v. Fannie Mae Consumer Res. Ctr. Inc.

• Decision Date: 31 October 2014
• Docket Number: Civil Action No. 6:13-1983-TMC
• Court: U.S. District Court — District of South Carolina
• Parties: Joel Clay Bracken, Plaintiff, v. Fannie Mae Consumer Resource Center Inc., also known as Fannie Mae, also known as Federal National Mortgage Association, also known as FNMA Defendants.

Joel Clay Bracken, Plaintiff, v. Fannie Mae Consumer Resource Center Inc., also known as Fannie Mae,also known as Federal National Mortgage Association, also known as FNMA Defendants.

Civil Action No. 6:13-1983-TMC

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF SOUTH CAROLINA GREENVILLE DIVISION

October 31, 2014

ORDER

Joel Clay Bracken ("Bracken"), the plaintiff, proceeding pro se, brought this suit against the Federal National Mortgage Association ("Fannie Mae"), alleging that Fannie Mae violated the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681 et. seq., by obtaining his consumer report,¹ without his permission, on five different occasions.² (ECF No. 1). Pursuant to 28 U.S.C. § 636(b)(1)(A) and Local Rule 73.02(B)(2)(g), D.S.C., pre-trial matters have been referred to a magistrate judge. This case is now before the court on the magistrate judge's Report and Recommendation ("Report"), recommending that the court deny Bracken's amended in forma pauperis ("IFP") application and requiring him to submit the filing fee. (ECF No. 85). Bracken timely objected to the Report. (ECF No. 89). Also before the court is Fannie Mae's motion for summary judgment. (ECF No. 64). The parties have fully briefed the motion.³ For the reasonsthat follow, the court grants the defendant's motion for summary judgment, and declines to adopt the magistrate judge's recommendation regarding Bracken's IFP status.

I. Background

Bracken purchased land located at 3313 Lanewood Drive, Greenville, South Carolina 29607, in 2002 from Conseco Finance Servicing Corporation. (ECF No. 80, p. 4). To finance the purchase, Bracken borrowed $95,500 from Coastal Mortgage Services, Inc. (ECF No. 80, p. 4). Fannie Mae was not a party to either the land purchase contract or the financing contract. (ECF No. 80).

In October 2009, Bracken defaulted on the note.⁴ The property is currently in foreclosure proceedings in Greenville County. (ECF No. 84-1). Fannie Mae obtained Bracken's credit report from Equifax on December 27, 2011, March 27, 2012, June 26, 2012, December 25, 2012, and June 25, 2013.⁵ (ECF No. 1-2, p. 1). Bracken never consented to nor gave permission directly to Fannie Mae to obtain his credit report nor did the parties ever directly interact. (ECF No. 1-2, p. 1).

II. Motion for Summary Judgment

A. Legal Standard

Summary judgment is appropriate if, after reviewing the entire record in a case, the court is satisfied that no genuine issues of material fact exist and that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). An issue of fact is "genuine" if the evidenceis such that a reasonable jury could return a verdict for the plaintiff. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Issues of fact are "material" only if establishment of such facts might affect the outcome of the lawsuit under the governing substantive law. Id.

"The party moving for summary judgment has the [initial] burden of establishing that there is no genuine issue as to any material fact and that he is entitled to judgment as a matter of law." Catawba Indian Tribe of S.C. v. South Carolina, 978 F.2d 1334, 1339 (4th Cir. 1992). Thereafter, the party opposing summary judgment must come forth with "sufficient evidence supporting the claimed factual dispute," and cannot "rest upon the mere allegations or denials of his pleading." Anderson, 477 U.S. at 248 (quoting First Nat'l Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 288-89 (1968)). "Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Id. at 247. "Although the court must draw all justifiable inferences in favor of the nonmoving party, the nonmoving party must rely on more than conclusory allegations, mere speculation, the building of one inference upon another, or the mere existence of a scintilla of evidence." Dash v. Mayweather, 731 F.3d 303, 311 (4th Cir. 2013); see also Catawba Indian Tribe of S.C., 978 F.2d at 1339 ("The non-moving party 'must do more than simply show that there is some metaphysical doubt as to the material facts.'" (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986))); Williams v. Cerberonics, Inc., 871 F.2d 452, 459 (4th Cir. 1989) (stating that the plaintiff "presented no evidence to support her claim other than her own assertions" and set against the documentation, "no reasonable trier of fact could" find for her); Ross v. Commc'ns Satellite Corp., 759 F.2d 355, 365 (4th Cir. 1985), overruled on other grounds, 490 U.S. 228 (1989) ("Genuineness means that the evidence must create fair doubt; wholly speculative assertions will not suffice."). In sum, "[w]here the record taken as a wholecould not lead a rational trier of fact to find for the non-moving party, there is no 'genuine issue for trial.'" Matsushita Elec. Indus. Co, 475 U.S. at 587 (Cities Serv. Co., 391 U.S. at 289)).

B. Discussion

Bracken argues that Fannie Mae violated his privacy rights under the FCRA by obtaining Equifax credit reports without his permission and without a permissible purpose. (ECF No. 1, p. 5).

"Congress enacted the FCRA in 1970 to promote efficiency in the Nation's banking system and to protect consumer privacy." TRW Inc. v. Andrews, 534 U.S. 19, 23 (2001). Although the two goals may have tension, Congress permitted the furnishing of credit reports because "[c]onsumer reporting agencies have assumed a vital role in assembling and evaluating consumer credit and other information on consumers." 15 U.S.C. § 1681(a)(3). To protect consumers, the FCRA sought to have "consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and proper utilization of such information." 15 U.S.C. § 1681(b).

In addition to regulating and imposing liability on consumer reporting agencies, the FCRA also protects consumers from any person who receives a consumer report for an improper purpose. 15 U.S.C. § 1681b(f). The FCRA limits access to consumer reports for only certain "permissible purposes." See 15 U.S.C. § 1681b. One of the permissible grounds states that a

consumer reporting agency may furnish a consumer report . . . [t]o a person which it has reason to believe (A) intends to use the information in connection with a credit transaction involving the consumer on whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer.

15 U.S.C. § 1681b(a)(3)(A). The FCRA creates civil liability for willful or negligent noncompliance with its provision. 15 U.S.C. §§ 1681n, 1681o. "To prove willfulness under the [FCRA, Bracken] must 'show that the defendant knowingly and intentionally committed an act in conscious disregard for the rights of the consumer.'" Ausherman v. Bank of Am. Corp., 352 F.3d 896, 900 (4th Cir. 2003) (quoting Dalton v. Capital Associated Indus., 257 F.3d 409, 418 (4th Cir. 2001)).

Bracken makes two types of arguments as to why the court should not grant summary judgment.⁶ First, Bracken argues that an entity in the position of Fannie Mae cannot avail itself to the permissible purposes in 15 U.S.C. § 1681b. Second, Bracken argues that Fannie Mae, itself, cannot claim that it had a permissible purpose for obtaining his consumer report because it is not the owner of the note and mortgage.

i. Permissible Purposes

Bracken argues that an entity in Fannie Mae's situation cannot avail itself to the permissible purposes of 15 U.S.C. § 1681b because only consumer reporting agencies can claim a permissible purpose, and even if non-consumer reporting agencies could claim a permissible purpose, only those entities that directly interacted with the consumer could allege a permissible purpose. (ECF No. 80-1, p. 11-14). Section 1681b(a) states, in pertinent part:

Subject to subsection (c) of this section, any consumer reporting agency may furnish a consumer report under the following circumstances and no other:

(1) In response to the order of a court having jurisdiction to issue such an order, or a subpoena issued in connection with proceedings before a Federal grand jury.

(2) In accordance with the written instructions of the consumer to whom it relates.

(3) To a person which it has reason to believe—

(A) intends to use the information in connection with a credit transaction involving the consumer on whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer . . . .

15 U.S.C. § 1681b(a).

Bracken first argues that only consumer reporting agencies can avail themselves to the exception because the statutory text applies only to them and that Fannie Mae is not a consumer reporting agency. (ECF No. 80-1, p. 13-14). Fannie Mae is not a consumer reporting agency under the FCRA.

Although Fannie Mae is not a consumer reporting agency, Bracken is incorrect in his assertion that a creditor or a debt collector cannot avail itself to this provision. Section 1681b(f) states, in pertinent part, that: "[a] person shall not use or obtain a consumer report for any purpose unless (1) the consumer report is obtained for a purpose for which the consumer report is authorized to be furnished under this section." Person is defined as: "any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity." 15 U.S.C. § 1681a(b). Fannie Mae is a person under the definition. Because Section 1681b(f) states that a "person" must have an authorized purpose to obtain a consumer report and because Section 1681b(a) defines what an authorized purpose is under the statute, Fannie Mae as a "person" can claim a permissible purpose. See Padin v. Oyster Point Dodge, 397 F. Supp. 2d...