Daniel v. Concord Advice, LLC.
| Decision Date | 06 May 2020 |
| Docket Number | Case No. 8:19-CV-02978-T-02SPF |
| Parties | CAROL DANIEL, Plaintiff, v. CONCORD ADVICE, LLC., MICHAEL LUXENBERG, SPEEDY SERVICING, INC. and CLARITY SERVICES INC., Defendants. |
| Court | U.S. District Court — Middle District of Florida |
This matter is before the Court on Defendants Concord Advice, LLC and Michael Luxenberg's Motion to Dismiss. Dkt. 32. Plaintiff, Carol Daniel, filed a response. Dkt. 40. Defendants filed a reply. Dkt. 43. With the benefit of full briefing the Court denies in part and defers in part the Motion to Dismiss.
The Court discussed the factual background of this case at length in its prior order dated April 6, 2020. Dkt. 44. As such, the Court will only briefly review the facts as alleged by Plaintiff.
Plaintiff alleges that on September 1, 2017, Defendant Speedy Servicing1 requested a credit bureau report from Clarity2 regarding Plaintiff without having a loan application or request from Plaintiff. Dkt. 19 ¶ 236. Plaintiff alleges that this inquiry was done without her knowledge or permission in violation of the Fair Credit Reporting Act ("FCRA"). Plaintiff alleges that Defendant Michael Luxenberg, owner of Defendant Concord Advice, LLC, is the de facto owner of Speedy Servicing and is responsible for its conduct. Dkt. 19 ¶¶ 18-23. Defendant Luxenberg argues that these allegations are false and that neither he nor Concord are responsible for pulling credit reports, they merely provide IT and consulting services to Speedy. Dkt. 32 at 2.
A motion to dismiss because the plaintiff lacks standing is an attack on the district court's subject matter jurisdiction and is brought pursuant to Rule 12(b)(1). Doe v. Pryor, 344 F.3d 1282, 1284 (11th Cir. 2003). When defendants make a facial attack on subject matter jurisdiction the plaintiff receives similar safeguards to a challenge under Rule 12(b)(6). McElmurray v. Consol. Gov't of Augusta-Richmond Cty., 501 F.3d 1244, 1251 (11th Cir. 2007) (citation omitted)."Accordingly, the court must consider the allegations in the plaintiff's complaint as true." Id. (internal quotation omitted).
Under a motion to dismiss for lack of personal jurisdiction, plaintiffs have "the burden of establishing a prima facie case of personal jurisdiction over a nonresident defendant." Meier ex rel. Meier v. Sun Int'l Hotels, Ltd., 288 F.3d 1264, 1268-69 (11th Cir. 2002) (citation omitted). When "the defendant submits affidavits to the contrary, the burden traditionally shifts back to the plaintiff to produce evidence supporting jurisdiction unless those affidavits contain only conclusory assertions that the defendant is not subject to jurisdiction." Id. at 1269 (citation omitted). "Where the plaintiff's complaint and supporting evidence conflict with the defendant's affidavits, the court must construe all reasonable inferences in favor of the plaintiff." Id. (citation omitted).
To survive a Rule 12(b)(6) motion to dismiss, a plaintiff must plead sufficient facts to state a claim that is "plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation omitted). When considering a Rule 12(b)(6) motion, the Court accepts all factual allegations in the complaint as true and construes them in the light most favorable to the plaintiff. Pielage v. McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008) (citation omitted). Courts should limit their "consideration to the well-pleaded factual allegations, documents central to or referenced in thecomplaint, and matters judicially noticed." La Grasta v. First Union Sec., Inc., 358 F.3d 840, 845 (11th Cir. 2004) (citations omitted).
Defendants moved to dismiss Plaintiff's Amended Complaint on three grounds. First, that Plaintiff lacks standing to bring this FCRA claim. Second, that this Court lacks jurisdiction over the Defendants. Third, that Plaintiff has failed to sufficiently allege a claim under the FCRA. Each of these will be addressed in turn.
Defendants argue that the Plaintiff lacks standing to bring this FCRA claim because she has not alleged a concrete and particularized injury. Dkt. 32 at 14. Defendants argue that under the Supreme Court precedent in Spokeo, Plaintiff has failed to allege the constitutional minimum to obtain standing. Id. at 15; Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016)
To begin, plaintiffs have the burden of proving that they have Article III standing. Spokeo, 136 S. Ct. at 1547. To do that, plaintiffs must allege sufficient facts to establish that they "(1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision." Id. (citation omitted). "[A]t the pleading stage, [plaintiffs] must 'clearly ... allege facts demonstrating' each element." Id. (quotingWarth v. Seldin, 422 U.S. 490, 518 (1975)). "To establish injury in fact, [Plaintiff] must show that [she] suffered 'an invasion of a legally protected interest' that is 'concrete and particularized' and 'actual or imminent, not conjectural or hypothetical.'" Id. at 1548 (citation omitted). Under a facial attack to standing, as here, the allegations of the complaint must be accepted as true. See McElmurray, 501 F.3d at 1251 ().
Plaintiff bases her case on allegations the Speedy Servicing made a 'hard' credit inquiry about her credit information without her authorization and without a permissible purpose. Dkt. 19 at 33-34. Defendants argue that this is not a particularized or concrete injury. Dkt. 32 at 14. The Court disagrees.
"For an injury to be 'particularized,' it 'must affect the plaintiff in a personal and individual way.'" Spokeo, 136 S. Ct. at 1548. The Plaintiff was personally affected because it was her information that was allegedly requested without her authorization and it was her credit report that contained the allegedly improper 'hard' inquiry. This is a sufficiently particularized injury under Spokeo. Id.
In Spokeo, the Supreme Court determined that while an injury does not have to be tangible to be concrete, a "bare procedural violation" of the FCRA is insufficient to confer standing. Id. at 1549-50. Instead, to determine whether aninjury is sufficiently concrete to confer standing, the court must "consider whether [the] alleged intangible harm has a close relationship to a harm that has traditionally been regarded as providing a basis for a lawsuit in English or American courts," and determine whether Congress has elevated the intangible harm to the status of a legally cognizable injury. Id. at 1549.
The alleged harm here is sufficiently concrete to confer Article III standing. Plaintiff alleges that the 'hard' inquiry becomes part of her credit report, which is provided to other lenders, and lowers her credit score. Dkt. 19 ¶ 238. This lower credit score could result in her being denied a loan from another lender or having to pay a higher interest rate. The Eleventh Circuit has recognized that such economic harm is "a quintessential injury in fact." Pinson v. JPMorgan Chase Bank, N.A., 942 F.3d 1200, 1207 (11th Cir. 2019). The Eleventh Circuit has also recognized that reporting inaccurate information about a plaintiff's credit is closely related "to the harm caused by publication of defamatory information" which is itself a concrete injury. Id. At this stage the Court accepts the allegations in a plaintiff's complaint as true, as such Ms. Daniel's has adequately alleged a sufficient injury in fact to confer standing.
Even if Plaintiff has failed to sufficiently plead economic harm as a concrete injury, multiple courts, including the Middle District of Florida, have held that a violation of the FCRA's prohibition against using or obtaining consumer reportsfor an impermissible purpose is not the sort of "bare procedural violation" discussed in Spokeo. See, e.g., Marcus Forbes v. Concord Advice, LLC et al., No. 8:19-cv-02980-VMC-CPT, Dkt. 73 at 11 (M.D. Fla. Apr. 21, 2020); Nayab v. Capital One Bank (USA), N.A., 942 F.3d 480, 492-93 (9th Cir. 2019); Heagerty v. Equifax Info. Servs., LLC, No. 1:18-cv-1233-CAP, 2020 WL 1315712, at *5-6 (N.D. Ga. Mar. 19, 2020); Blumenfeld v. Regions Bank, 374 F. Supp. 3d 1165, 1168-69 (N.D. Ala. 2019). Instead, the FCRA conferred a substantive right and an allegation of infringement on that right is a concrete injury. Gause v. Med. Bus. Consultants, Inc., 424 F. Supp. 3d 1175, 1197-98 (M.D. Fla. Dec. 12, 2019). Thus, Plaintiff has sufficiently alleged an injury in fact, and she has Article III standing.
Next, Defendants argue that Plaintiff's claim should be dismissed for lack of personal jurisdiction. Dkt. 32 at 7. Defendants argue that this Court has neither general nor specific personal jurisdiction over Defendants. Id. at 7-12. Defendants further argue that they do not possess minimum contacts with the forum and that exercising jurisdiction over them would violate the traditional notions of fair play. Id. at 12-13. In her response, Plaintiff argues that there is specific personal jurisdiction over Defendants and that Defendants have the necessary minimum contacts with the forum. Dkt. 40 at 14.
To establish personal jurisdiction over a non-resident defendant, the Court's inquiry is two-fold: "(1) whether personal jurisdiction exists over the nonresident defendant . . . under Florida's long-arm statute, and (2) if so, whether that exercise of jurisdiction would violate the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution." Louis Vuitton Malletier, S.A. v. Mosseri, 736 F.3d 1339, 1350 (11th Cir. 2013) (citation omitted); see Sun Bank, N.A. v. E.F. Hutton & Co., 926 F.2d 1030, 1033 (11th Cir. 1991).
The first step in this analysis is to determine whether Plaintiff has sufficiently alleged a...
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