Gorman v. Wolpoff & Abramson, Llp

• Decision Date: 23 June 2006
• Docket Number: No. C 04-04507 JW.,C 04-04507 JW.
• Citation: 435 F.Supp.2d 1004
• Court: U.S. District Court — Northern District of California
• Parties: John GORMAN, Plaintiff, v. WOLPOFF & ABRAMSON, LLP, et al., Defendants.

435 F.Supp.2d 1004

John GORMAN, Plaintiff, v. WOLPOFF & ABRAMSON, LLP, et al., Defendants.

No. C 04-04507 JW.

United States District Court, N.D. California, San Jose Division.

June 23, 2006.

Craig Alan Hansen, John C. Gorman, Gorman & Miller, San Jose, CA, for Plaintiff.

Tomio B. Narita, Jeffrey A. Topor, Wineberg, Simmonds & Narita LLP, San Francisco, CA, for Defendants.

ORDER GRANTING DEFENDANT MBNA'S MOTION FOR SUMARY JUDGMENT; GRANTING DEFENDANT WOLPOFF & ABRAMSON'S MOTION FOR SUMMARY JUDGMENT; DENING DEFENDANT WOLPOFF & ABRAMSON'S REQUEST FOR FINDING OF BAD FAITH; SETING HEARING ON ORDER TO SHOW CAUSE RE: RULE 11 SANCTIONS

WARE, District Judge.

I. INTRODUCTION

John Gorman ("Gorman" or "Plaintiff') alleges libel and violations of various state and federal fair credit reporting and debt collection statutes against MBNA and MBNA's attorney, Wolpoff & Abramson, ("Wolpoff," collectively "Defendants"). MBNA and Wolpoff each filed a Motion for Summary Judgment. On June 5, 2005, the Court held a hearing on Defendants' Motions. Based on the papers filed to date and the statements of counsel at the hearing, the MBNA's Motion for Summary Judgment is GRANTED, Wolpoffs Motion for Summary Judgment is GRANTED and Request for Finding of Bad Faith is DNIED.

II. BACKGROUND

Gorman is an attorney and a former holder of a MBNA Visa credit card. (Second Amended Complaint, Docket Item No. 41, "SAC" at ¶¶ 1, 4.) "In or about January and February 2003," Gorman disputed the legitimacy of credit card charges from "Four Peaks Entertainment" ("Four Peaks") that were posted to his account. (SAC ¶ 7, 8.) According to Gorman, Four Peaks shipped defective equipment that could not be successfully installed, and a Four Peaks installer damaged Gorman's roof. (SAC ¶ 7). Upon receiving written notification from Gorman, MBNA temporarily removed the charges, but later reposted them and refused to remove them again. (SAC ¶ 8.) MBNA retained Wolpoff & Abramson, a law firm that handles debt collection cases, to initiate legal action against Gorman. (SAC ¶¶ 2, 9.) According to the SAC, MBNA and Wolpoff placed "at least several hundred telephone calls" to Gorman regarding his alleged debt. (SAC ¶ 10.) Gorman provides a single example of receiving multiple telephone calls during a dinner party at his residence on August 14, 2003 where he asked the caller to cease calling, but the calls continued. (SAC ¶ 10.)

In Spring of 2004, Gorman discovered that MBNA "falsely reported" to various credit reporting agencies that he was delinquent on his obligations to MBNA, without reporting that the debt was "disputed." (SAC ¶¶, 12.) Gorman alleges that on May 6, 2004, he notified Equifax, Trans Union, and Experian (collectively, "CRAs") in writing that the information provided by MBNA was mistaken. (SAC ¶ 12.) The CRAs subsequently informed him that MBNA would not make any changes or corrections, and MBNA did not inform the CRAs that the alleged debt was disputed. (SAC ¶ 12.) Gorman also alleges that he wrote to MBNA on September 15, 2004, requesting that it correct the information, but MBNA did not take any corrective action. (SAC ¶ 12.)

On May 4, 2005, the Court dismissed Gorman's First Amended Complaint, but granted leave to amend as to particular allegations. The SAC alleges causes of action for libel and violations of the Fair Credit Reporting Act ("FCRA") 15 U.S.C. §§ 1681n, 16810 against Defendant MBNA. The SAC also contains a cause of action for violations of the Fair Debt Colloction Practices Act ("FDCPA") §§ 1692c, 1692d against Defendant Wolpoff. MBNA and Wolpoff each move for summary judgment.

III. STANDARDS

Summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R.Civ.P. 56(c). The purpose of summary judgment "is to isolate and dispose of factually unsupported claims or defenses." Celotex v. Catrett, 477 U.S. 317, 323-324, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

The moving party "always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any' which it believes demonstrate the absence of a genuine issue of material fact." Id. at 323, 106 S.Ct. 2548. If this burden is met, the moving party is then entitled to judgment as a matter of law when the non-moving party fails to make a sufficient showing on an essential element with respect to which the nonmoving party bears the burden of proof at trial. Id. at 322-23, 106 S.Ct. 2548.

The non-moving party "must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). The non-moving party cannot defeat the moving party's properly supported motion for summary judgment simply by alleging some factual dispute between the parties. To preclude the entry of summary judgment, the non-moving party must bring forth material facts, i.e., "[f]actual disputes that are irrelevant or unnecessary will not be counted." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The opposing party "must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

The court must draw all reasonable inferences in favor of the non-moving party, including questions of credibility and of the weight to be accorded particular evidence. Masson v. New Yorker Magazine, Inc., 501 U.S. 496, 520, 111 S.Ct. 2419, 115 L.Ed.2d 447 (1991) (citing Anderson, 477 U.S. at 255, 106 S.Ct. 2505); Matsushita, 475 U.S. at 588, 106 S.Ct. 1348; T.W. Elec. Serv. v. Pac. Elec. Contractors, 809 F.2d 626, 630 (9th Cir.1987). It is the court's responsibility "to determine whether the `specific facts' set forth by the nonmoving party, coupled with undisputed background or contextual facts, are such that a rational or reasonable jury might return a verdict in its favor based on that evidence." T.W. Elec. Serv., 809 F.2d at 631. "[S]ummary judgment will not lie if the dispute about a material fact is `genuine,' that is if the evidence is such that a reasonable, jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248, 106 S.Ct. 2505. However, "[w]here the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no `genuine issue for trial.'" Matsushita, 475 U.S. at 587, 106 S.Ct. 1348.

IV. DISCUSSION

A. FCRA Claims

Because there is no private right of action under § 1681s-2(a), Nelson v. Chase Manhattan Mortgage Corp., 282 F.3d 1057, 1059 (9th Cir.2002), Gorman's § 1681n and § 16810 claims survive summary judgment only if Gorman can base them on willful and negligent violations of § 1681s-2(b). See Gorman v. Wolpoff &amp Abramson, 370 F.Supp.2d 1005, 1012 (citing Nelson). Unlike § 1681s-2(a) which imposes a "duty of furnishers of information to provide accurate information," § 1681s-2(b) is directed to the "duties of furnishers of information upon notice of dispute." In relevant part, § 1681s-2(b) provides:

After receiving notice pursuant to section 1681i(a)(2) of this title of a dispute with regard to the completeness or accuracy of any information provided by a person to a consumer reporting agency, the person shall —

(A) conduct an investigation with respect to the disputed information;

(B) review all relevant information provided by the consumer reporting agency pursuant to section 1681i(a)(2) of this title;

(C) report the results of the investigation to the consumer reporting agency;

(D) if the investigation finds that the information is incomplete or inaccurate, report those results to all other consumer reporting agencies to which the person furnished the information and that compile and maintain files on consumers on a nationwide basis; and

(E) if an item of information disputed by a consumer is found to be inaccurate or incomplete or cannot be verified after any reinvestigation under paragraph (1), for purposes of reporting to a consumer reporting agency only, as appropriate, based on the results of the reinvestigation promptly —

(i) modify that item of information;

(ii) delete that item of information; or

(iii) permanently block the reporting of that item of information.

The SAC contains a conclusory allegation that "[o]n information and belief, MBNA ... [was] notified by the various credit reporting agencies of the existence of plaintiff's dispute yet failed to conduct a complete and sufficient investigation." (SAC ¶ 12.)

The record indicates MBNA conducted an investigation of the initial Four Peaks charge, (Decl. of Kristin Lepley in Support of Mot. for Summ. J. by Def. MBNA, Docket Item No. 53 ("Lepley Decl.") at ¶ 5-15), as well of each of Gorman's four disputes received from the CRAB (Lepley Decl. ¶ 17-20.) MBNA received a customer dispute form from TransUnion dated May 13, 2004 regarding Gorman's account which read "Claims company will change. Verify all account information." (Lepley Decl., Exh. 2.) By declaration, Ms. Lepley, a compliance officer in the customer assistance department of MBNA (Lepley Decl. ¶ 1), stated that MBNA reviewed its account notes for Gorman's account and determined that MBNA had not agreed to delete any charges or to modify the account information in any way. MBNA found that there were some minor differences such as birthdate and address information between MBNA and TransUnion's records, and MBNA submitted this information to TransUnion along with additional delinquency information concerning Gorman's account. (Lepley Decl. ¶ 17.) MBNA received three other customer dispute forms: (1) from Experian, dated May 18,...