Hammoud v. Equifax Info. Servs., LLC, 21-2859
| Docket Number | 21-2859 |
| Decision Date | 04 November 2022 |
| Citation | 52 F.4th 669 |
| Parties | Ahmed HAMMOUD, Plaintiff-Appellant, v. EQUIFAX INFORMATION SERVICES, LLC, Defendant, Experian Information Solutions, Inc., Defendant-Appellee. |
| Court | U.S. Court of Appeals — Sixth Circuit |
ARGUED: Youssef H. Hammoud, HAMMOUD LAW, P.C., Santa Ana, California, for Appellant. Christopher A. Hall, JONES DAY, Chicago, Illinois, for Appellee. ON BRIEF: Youssef H. Hammoud, HAMMOUD LAW, P.C., Santa Ana, California, David A. Chami, PRICE LAW GROUP, APC, Scottsdale, Arizona, for Appellant. James Joseph, JONES DAY, Detroit, Michigan, for Appellee.
Before: COLE, BUSH, and NALBANDIAN, Circuit Judges.
COLE, J., delivered the opinion of the court in which BUSH and NALBANDIAN, JJ., joined. NALBANDIAN, J. (pp. 676-80), delivered a separate concurring opinion.
Mohamad and Ahmed Hammoud—father and son, respectively—filed Chapter 7 bankruptcy petitions just over a year apart using the same attorney. Both petitions contained their similar names, identical address, and—mistakenly—Ahmed's social security number. Although the attorney corrected the social security number on Mohamad's bankruptcy petition the day after it was filed, Experian Information Solutions, Inc. failed to catch the amendment and erroneously reported Mohamad's bankruptcy on Ahmed's credit report for nine years.
In 2019, Ahmed sued Experian and Equifax Information Services, Inc., alleging that each had violated § 1681e(b) of the Fair Credit Reporting Act by failing to "follow reasonable procedures to assure maximum possible accuracy" of his reported information. 15 U.S.C. § 1681e(b). Equifax and Ahmed settled. The remaining parties—Experian and Ahmed—cross-moved for summary judgment, and the district court granted Experian's motion. We agree with the district court that Ahmed has standing to bring this action, but also agree that he cannot establish that Experian's procedures were unreasonable as a matter of law. We therefore affirm.
Ahmed Hammoud filed a Chapter 7 bankruptcy petition through his attorney, Kurt Thornbladh, on September 28, 2009. The petition listed: his name as "Ahmed M. Hammoud"; his address as 8465 Berwyn in Dearborn Heights, Michigan; and his social security number as ending in 7409. The bankruptcy court discharged his bankruptcy on January 5, 2010.
Mohamad Hammoud—Ahmed's father—filed a joint bankruptcy petition with his wife, Sanaa M. Hammoud, on October 11, 2010. Thornbladh also served as their counsel. Mohamad's petition listed: his name as "Mohamad Hammoud," with an alternative name of "Ahmed Mohamad Hammoud"; his address as 8465 Berwyn in Dearborn Heights, Michigan; and his social security number as ending in 7409. This social security number, however, was inaccurate; the last four digits of Mohamad's number are 4341.
The day after Thornbladh filed Mohamad's bankruptcy petition, he realized that he had included Ahmed's social security number rather than Mohamad's. So, Thornbladh filed a "Statement of Social Security Number" to correct the error on Mohamad's petition.
Despite the quick correction, the mistake had already been conveyed to Experian through its data collector, LexisNexis. Experian contracts with LexisNexis to obtain public records regarding consumer bankruptcies. Every day, LexisNexis supplies Experian with a summary of information contained in these records, and Experian then uses automated systems to match that information with a specific consumer file. For a record to be matched to a consumer, however, the social security number must be an exact match. Because of that, Experian's algorithms paired the mistaken social security number in Mohamad's bankruptcy petition with Ahmed's credit file. By the time Mohamad was granted a discharge in 2012, the court's order contained only Mohamad's corrected social security number—not his son's. Consequently, Experian updated Mohamad's credit file to reflect the discharge, but not Ahmed's. As a result, Experian reported an unresolved October 2010 bankruptcy on Ahmed's credit report for nine years.
Ahmed first learned that his father's bankruptcy petition was linked to his credit file in 2015 or 2016. In June 2016, Thornbladh prepared a letter on Ahmed's behalf to alert Experian of the error and request a correction. But due to a miscommunication between Ahmed and Thornbladh, the letter was never sent, and Experian was not notified of the inaccuracy.
Nearly three years later, Ahmed was in the process of completing a loan application to refinance his home. As part of the application, he again obtained his credit report in May 2019 and noticed that Experian had erroneously reported two bankruptcies on his credit file. His September 2019 report also showed that two creditors—Advantage Credit Incorporated and SettlementOne/Mortgage Center—had inquired about his credit history, and that Experian had shared information with them. Rather than complete the refinancing process, Ahmed withdrew his application because his loan officer informed him that he would be unable to secure an automated loan approval due to the undischarged bankruptcy listed on his credit report. Ahmed also decided against pursuing a manual underwriting process because it would have resulted in additional documentation, fees, and delays.
On August 13, 2019, Ahmed sent a letter to Experian disputing the October 2010 bankruptcy recorded on his credit report and demanding a sum in settlement. Experian removed Mohamad's bankruptcy filing from Ahmed's credit history on August 28, 2019.
Ahmed sued Experian and Equifax in November 2019. He alleged that both had violated § 1681e(b) of the Fair Credit Reporting Act by failing to follow "reasonable procedures to assure maximum possible accuracy" of Ahmed's credit history. See 15 U.S.C. § 1681e(b). Ahmed and Equifax settled.1 Experian, however, moved to dismiss the claim for lack of subject matter jurisdiction, and then moved for summary judgment two weeks later. Ahmed cross-moved for summary judgment. Ultimately, the district court denied Experian's motion to dismiss, denied Ahmed's motion for summary judgment, and granted Experian's motion for summary judgment. Hammoud v. Experian Info. Sols., Inc. , No. 19-13262, 2021 WL 5106366, at *14 (E.D. Mich. July 23, 2021). Ahmed appealed.
Before reaching the merits, we must assess whether Ahmed has Article III standing. We review a district court's standing determination de novo. Pedreira v. Ky. Baptist Homes for Children, Inc. , 579 F.3d 722, 728–29 (6th Cir. 2009).
To satisfy Article III's requirements, Ahmed must show: (1) that he "suffered an injury in fact that is concrete, particularized, and actual or imminent"; (2) "the injury was likely caused by the defendant"; and (3) the injury "would likely be redressed by judicial relief." TransUnion LLC v. Ramirez , ––– U.S. ––––, 141 S. Ct. 2190, 2203, 210 L.Ed.2d 568 (2021) (citing Lujan v. Defs. of Wildlife , 504 U.S. 555, 560–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) ). The evidence required to sustain these elements corresponds "with the manner and degree of evidence required at the successive stages of the litigation." Lujan , 504 U.S. at 561, 112 S.Ct. 2130. At trial, for example, controverted facts must be "supported adequately by the evidence[.]" Id. But at summary judgment, it is enough that a plaintiff has "set forth by affidavit or other evidence specific facts" supporting each element. Id. (internal quotation marks omitted); see also McKay v. Federspiel , 823 F.3d 862, 867 (6th Cir. 2016).
At this stage of the litigation, Ahmed has satisfied each element of standing. As to the first and third elements, the Supreme Court clarified just last term that disclosing inaccurate information in a credit report to a third party constitutes a redressable injury sufficient to confer Article III standing. See TransUnion , 141 S. Ct. at 2208–09. Viewing the facts in the light most favorable to Ahmed—as we must on summary judgment, see McKay , 823 F.3d at 866–67 —he has sufficiently demonstrated a cognizable injury. The parties agree that the inaccuracy on his credit report was published to a third party. (See, e.g. , Reply Br. at 17; Recording of Oral Arg. at 17:01–17:16 (counsel for Experian conceding that record of the inaccurate information was published to a mortgage company).) And information in the record supports the same. (See Mortgage Center Notes, R. 50-26, PageID 723 (loan officer noting Ahmed's credit report shows "two chapter 7 [bankruptcies] within 8 years").) Accordingly, elements one and three are met.
The more difficult question concerns the second element of standing—whether Ahmed put forth evidence at summary judgment to demonstrate Experian caused his injury. Although Experian concedes both SettlementOne/Mortgage Center and Advantage Credit Incorporated accessed Ahmed's credit information, it claims the contents of a consumer report can vary, so it is possible that another credit reporting agency—Equifax, for example—could have been responsible for the disclosure. Experian asks us to construe this uncertainty against Ahmed and conclude he failed to carry his burden on standing. But doing so would contravene Lujan ’s command that the "evidence required" to support standing changes throughout the course of litigation. See 504 U.S. at 561, 112 S.Ct. 2130. Again, at the summary judgment stage, we must "consider the evidence in the light most favorable" to Ahmed and "draw all reasonable inferences in [his] favor"—even as to a subject-matter-jurisdictional inquiry such as standing. See McKay , 823 F.3d at 866–67 ; see also Lujan , 504 U.S. at 561, 112 S.Ct. 2130.
Viewing the facts in the light most favorable to Ahmed, his cognizable injury was fairly traceable to Experian's actions. The record reveals SettlementOne/Mortgage Center knew Ahmed's credit report showed "two chapter 7 [bankruptcies] within 8 years," (Mortgage Center Notes, R. 50-26, PageID 723), and...
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