Harroff v. Experian Info. Servs.
| Decision Date | 03 September 2019 |
| Docket Number | Case No. 2:18-cv-2154-KJD-GWF |
| Parties | SUSAN HARROFF, Plaintiff, v. EXPERIAN INFORMATION SERVICES, INC., Defendant. |
| Court | U.S. District Court — District of Nevada |
Presently before the Court is Defendant Experian Information Solutions, Inc.'s Motion for Judgment on the Pleadings (#11). Plaintiff Susan Harroff responded and alternatively moved for Leave to File Amended Complaint (#19) to which Experian replied (#20).
Susan Harroff's complaint arises from an Experian credit report ("Experian Report") dated May 8, 2018. The Experian Report showed that Harroff's Bank of America account had been "charged off" multiple times from September 2016 through December 2016, and again from January 2017 through August 2017. ECF No. 1, ¶ 9. A "charge off consists of a credit reporting agency ("CRA") treating an account receivable as a loss or expense because payment is unlikely. CHARGE OFF, Black's Law Dictionary (11th ed. 2019).
On or about June 21, 2018, Harroff disputed Experian's reporting of her Bank of America account in a "Dispute Letter." That letter claimed that the credit information provided by Bank of America and featured in the Experian Report was inaccurate. ECF No. 1, ¶ 10. Specifically, Harroff disputed the multiple charge-off notations listed on the Experian Report. Harroff also requested that if Experian did not make the changes identified in the Dispute Letter that Experian include a notice on her credit report stating that the account was disputed. Id. at ¶ 21. Upon receiving this Dispute Letter, Experian timely notified Bank of America of this dispute based on its mandated statutory duty pursuant to Section 1681i(a)(2)(A). Id. at ¶ 11. Experian was then required to investigate the disputed information on Harroff's consumer report and report the results of that investigation to the consumer reporting agency if the investigation found the information to be incomplete or inaccurate. 15 U.S.C. § 168li. Experian determined that the multiple charge-off notations were accurate and decided not to remove them from Harroff's report.
On or about July 11, 2018, Harroff received a "reinvestigation" report from Experian, Report No. 3422-7662-53 ("Experian Reinvestigation"). ECF No. 1, ¶ 14. Experian indicated that Harroff's disputed account had been researched and "Updated." Id. Harroff believes that Experian's "reinvestigation" also qualified as a purported disclosure of all information in the consumer's file pursuant to Section 1681g. Regardless, Experian did not remove the multiple charge off notations, which all appeared in the Experian Reinvestigation. Nor did Experian update Harroff's credit report to reflect her dispute.
In November of 2018, Harroff brought this suit. She alleged that Experian violated multiple sections of the Fair Credit Reporting Act (FCRA) when it (1) failed to remove the multiple charge-offs listed on her Experian Report, (2) failed to conduct a reasonable reinvestigation of those charge-offs , (3) failed to review all relevant information Harroff provided in her Dispute Letter, and (4) failed to verify the multiple charge-off notations in connection with her credit reports. Harroff alleges that Experian's continued reporting of the multiple charge off notations was willful and inaccurate, entitling her to statutory damages under 15 U.S.C. § 1681n. Finally, Harroff claims that she suffered actual damages, including fear of credit denials, transportation costs, lost time, stress, and aggravation. See 15 U.S.C. § 1681o.
On December 12, 2018, Experian moved for Judgment on the Pleadings (#11) and to Stay Discovery (#12). Harroff objected to Experian's motion and claims that she has adequately pleaded facts to support each alleged FCRA violation. Alternatively, Harroff requests leave toamend her complaint "in the event the Court grants any part of Experian's Motion." (#19 at 1). The parties' motions are fully briefed, and the Court now turns to their merits.
After the pleadings are closed—but early enough not to delay trial—a party may move for judgment on the pleadings. Fed. R. Civ. P. 12(c). A motion for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c) is "functionally identical" to a Federal Rule of Civil Procedure 12(b)(6) motion to dismiss for failure to state a claim. Dworkin v. Hustler Magazine, Inc., 867 F.2d 1188, 1192 (9th Cir. 1989). Judgment on the pleadings is proper when, taking all the allegations in the non-moving party's pleadings as true, the moving party is entitled to judgment as a matter of law. See Ventress v. Japan Airlines, 486 F.3d 1111, 1114 (9th Cir. 2009). However, the court is not required to accept legal conclusions cast in the form of factual allegations if those conclusions cannot reasonably be drawn from the facts alleged. See Clegg v. Cult Awareness Network, 18 F.3d 752, 754-55 (9th Cir. 1994).
A properly pled complaint must provide "[a] short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). While Rule 8 does not require detailed factual allegations, it demands "more than labels and conclusions" or a "formulaic recitation of the elements of a cause of action." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation omitted). "Factual allegations must be enough to rise above the speculative level." Twombly, 550 U.S. at 555. Thus, to survive a motion for judgment on the pleadings, a complaint must contain sufficient factual matter to "state a claim to relief that is plausible on its face." Iqbal, 556 U.S. at 678 (citation omitted).
In Iqbal, the Supreme Court clarified the two-step approach district courts are to apply when considering motions to dismiss. First, the court must accept as true all well-pled factual allegations in the complaint; however, legal conclusions are not entitled to the assumption of truth. Id. at 678-79. Mere recitals of the elements of a cause of action, supported only by conclusory statements, do not suffice. Id. at 678. Second, the court must consider whether thefactual allegations in the complaint allege a plausible claim for relief. Id. at 679. A claim is facially plausible when the plaintiff's complaint alleges facts that allow the court to draw a reasonable inference that the defendant is liable for the alleged misconduct. Id. at 678. Further, where the complaint does not permit the court to infer more than the mere possibility of misconduct, the complaint has "alleged—but not shown—that the pleader is entitled to relief." Id. (internal quotation marks omitted). When the allegations in a complaint have not crossed the line from conceivable to plausible, plaintiff's claim must be dismissed. Twombly, 550 U.S. at 570. Moreover, "[a]ll allegations of material fact in the complaint are taken as true and construed in the light most favorable to the non-moving party." In re StacElecs. Sec. Litig., 89 F.3d 1399, 1403 (9th Cir. 1996) (citation omitted).
If the court concludes that a motion for judgment on the pleadings should be granted, it must then decide whether to grant leave to amend. The court must construe all factual allegations set forth in the complaint as true and in the light most favorable to the plaintiff. See Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001). Flexibility in the pleading process is an important feature of the Federal Rules of Civil Procedure, and Rule 15(a) provides "[t]he court should freely give leave [to amend] when justice so requires." These pleading standards should be interpreted with extreme liberality bearing in mind "the underlying purpose of Rule 15 . . .[is] to facilitate decision on the merits, rather than on the pleadings or technicalities." Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (citation omitted). But courts may still deny leave to amend a complaint due to "undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, [and] futility of amendment." See Leadsinger, Inc. v. BMG Music Publ'g, 512 F.3d 522, 532 (9th Cir. 2008) (alteration in original). Dismissal with prejudice and without leave to amend is not appropriate unless it is clear on review that the complaint could not be saved by the proposed amendment. See Harris v. Cty. of Orange, 682 F.3d 1126, 1131 (9th Cir. 2012).
A. Experian's Motion for Judgment on the Pleadings
Harroff's complaint alleges one cause of action: "Violation of the Fair Credit Reporting Act 15 U.S.C. § 1681 et seq." Compl. 8, ECF No. 1. However, the complaint makes clear that its singular cause of action encompasses several alleged violations of § 1681. The complaint identifies potential violations of three subsections: § 1681e(b) (FCRA's accuracy provision); § 1681i (FCRA's investigation provision); and § 1681g (FCRA's consumer-disclosure provision). Each alleged violation originates with the multiple charge-offs on Harroff's Bank of America account and Experian's response to Harroff's dispute of those charge-offs. Accordingly, the Court will begin with Harroff's claim that the multiple charge-offs were inaccurate under § 1681e(b) and then proceed to the other alleged violations.
Harroff alleges that the Experian Report was inaccurate in violation of Section 1681e because it listed her Bank of America account as charged off multiple times. Section 1681e, entitled "Compliance procedures," describes what procedures a CRA must follow when preparing a consumer report. 15 U.S.C. § 1681e(b). The statute provides: "Whenever a [CRA] prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the...
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