Korotki v. Attorney Services Corp. Inc.

• Decision Date: 12 June 1996
• Docket Number: No. K-94-1212.,K-94-1212.
• Citation: 931 F. Supp. 1269
• Parties: Abraham Paul KOROTKI v. ATTORNEY SERVICES CORPORATION INC., et al.
• Court: U.S. District Court — District of Maryland

931 F. Supp. 1269

Abraham Paul KOROTKI v. ATTORNEY SERVICES CORPORATION INC., et al.

No. K-94-1212.

United States District Court, D. Maryland.

June 12, 1996.

COPYRIGHT MATERIAL OMITTED

Irwin R. Kramer, Owings Mills, Maryland, for plaintiff.

S. Todd Wilson, Terri L. Goldberg, and Eccleston and Wolf, Baltimore, Maryland, for defendants Thomas, Ronald & Cooper and Daniel V. Schmitt.

Sheila Brooks-Tahir, Baltimore, Maryland, for defendant Attorney Services Corporation.

FRANK A. KAUFMAN, Senior District Judge.

Plaintiff alleges that defendants violated the Federal Fair Credit Reporting Act (FCRA)¹ and the Maryland Consumer Credit Reporting Agencies Act (CCRAA)² when they acquired plaintiff's credit report in order to obtain an additional address at which to serve plaintiff with certain legal papers. Plaintiff also contends that defendants committed the tort of invasion of privacy. This Court has federal question jurisdiction over plaintiff's FCRA claim. 28 U.S.C. § 1331. Because plaintiff's remaining claims arise from the same case or controversy as his FCRA claim, this Court has supplemental jurisdiction over those state law claims. 28 U.S.C. § 1367. Pending before this Court are defendants' summary judgment motions and plaintiff's cross motion for summary judgment.

I. Facts and Procedural History

The relevant and material facts are undisputed. Plaintiff Korotki is the President of APK Development Corporation ("APK"), the developer for a property in Baltimore County, Maryland, known as Old Court Village ("OCV").³ Korotki, either on his own behalf or on behalf of APK, contracted with Baltimore County to have sewer and water mains and roads installed at OCV in 1991.⁴ Baltimore County requested and received bids for the performance of that utility work and awarded the contract to Angelozzi Brothers, Inc. ("Angelozzi"). While Angelozzi was performing the contract, questions arose among Angelozzi, Baltimore County officials and Korotki as to whether the contract required Angelozzi to perform certain compaction services. Korotki told Angelozzi that if the contract did not require Angelozzi to perform those services, Korotki would pay Angelozzi $12,000 to perform them and offered to pay in the form of a 1976 Cadillac Eldorado.⁵ Angelozzi apparently later reduced the price to $6,000.

Angelozzi submitted an invoice in the amount of $6,000 to Korotki on May 20, 1993.⁶ Korotki apparently refused to pay that invoice, claiming that the original contract between Angelozzi and Baltimore County required Angelozzi to perform the compaction services, and that, in any event, Angelozzi had failed appropriately to perform the work.⁷ Angelozzi then hired Defendant Thomas, Ronald & Cooper (TRC), a law firm which Angelozzi had used previously, to collect the disputed $6,000 from Korotki.⁸ Defendant Schmitt, a lawyer with the aforementioned firm, attempted to establish a mechanic's lien against the OCV property and enlisted the aid of Attorney Services Corporation (ASC) to post that property with notice of the lien.

Inadvertently, ASC posted the notice at Korotki's personal residence, instead of on the OCV property. Before Schmitt became aware of ASC's mistake, the 90-day notice period for establishing the mechanic's lien had expired.⁹ When Schmitt learned of the mistake on October 8, 1993, Schmitt instructed ASC to serve Korotki personally with papers regarding the mechanic's lien.¹⁰ Despite repeated attempts, ASC was unable to serve Korotki at the addresses which ASC had for him.¹¹ At that point, ASC contends, Schmitt directed ASC to obtain an alternate address for Korotki from recent credit and DMV reports.¹² ASC, without any specific authorization from Korotki or Schmitt, obtained a credit report from Equifax on October 25, 1995.¹³ ASC transmitted a copy of that report to Schmitt. ASC says it so did in order to show that ASC had been working on the case. ASC then destroyed its copy.¹⁴ ASC admits it had no use for the credit information in that report, but was only interested in obtaining an address at which to serve Korotki.¹⁵ Likewise, Schmitt made no use of the report.¹⁶ Moreover, Korotki does not allege that ASC, Schmitt or TRC used the credit report for any purpose.

After learning that ASC had obtained his credit report, Korotki filed the present action against ASC on May 9, 1994, alleging wilful and negligent violation of the FCRA, wilful and negligent violation of the Maryland Consumer Credit Reporting Agencies Act (CCRAA), and invasion of privacy. ASC, in turn, sued Schmitt and TRC for indemnification and/or contribution and for negligent misrepresentation. Korotki then amended his complaint to add Schmitt and TRC as defendants, alleging the same claims against both Schmitt and TRC as he had previously alleged against ASC. Finally, Schmitt and TRC cross claimed against ASC for contribution and indemnification.

On November 6, 1995, defendant ASC filed a summary judgment motion against plaintiff. Plaintiff simultaneously opposed that motion and filed a cross-motion for partial summary judgment on liability only. This Court held an on-the-record motions hearing in open court on December 29, 1995 to consider those motions. At that time, the Court afforded Defendants TRC and Schmitt the opportunity to file a summary judgment motion against plaintiff, and those defendants thereafter filed that motion on January 5, 1996. At the aforementioned December 29, 1995 hearing, this Court also invited all parties to submit further filings to this Court regarding various issues.¹⁷

On January 19, 1996, plaintiff filed a motion regarding TRC's and Schmitt's failure to respond to his second request for production of documents. Plaintiff's second request for documents contained four separate requests. Regarding the first two requests, counsel for TRC and Schmitt represented that she had previously provided to counsel for plaintiff all documents responsive to those requests. The second two requests sought certain financial information from TRC and Schmitt. According to counsel for plaintiff, such requests were relevant only to plaintiff's claim for punitive damages. This Court delayed ruling on the second two requests until after deciding the aforementioned pending summary judgment motions. Because this Court will decide those motions in favor of defendants, and determine that there is no liability upon any defendant herein, no damage issue need be reached and plaintiffs' motion regarding discovery as to punitive damages is moot.

In several written and oral communications with counsel, this Court afforded the parties opportunities to make additional filings. The final deadline for these filings was March 24, 1996. Having considered all motions filings, this Court will grant summary judgment in favor of defendants and deny plaintiff's summary judgment motion. The summary judgment motion of defendants TRC and Schmitt will be treated as moot.

II. Summary Judgment Standard

Summary judgment shall be granted "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 a judgment as a matter of law." Fed.R.Civ.P. 56. Material facts are those facts which the substantive law identifies as "facts that might affect the outcome of the suit." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). A dispute concerning material facts is genuine if "a reasonable jury could return a verdict for the nonmoving party." Id. "A defendant moving for summary judgment has the burden of showing the absence of any genuine issue of material fact and that he is entitled to judgment as a matter of law.... Once a defendant makes the necessary showing, the plaintiff must go forward and produce evidentiary facts to support his contention." Barwick v. Celotex Corp., 736 F.2d 946, 958 (4th Cir.1984). In fact, "when a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but ... must set forth specific facts showing that there is a genuine issue for trial." Fed. R.Civ.P. 56(e). However, the non-movant is entitled to have all reasonable inferences drawn in his favor. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59, 90 S.Ct. 1598, 1608-10, 26 L.Ed.2d 142 (1970).

III. Analysis

In deciding the pending motions, this Court must address four issues. First, is the report ASC obtained from Equifax on October 25, 1993 a "consumer report" to which the FCRA applies?¹⁸ Second, if so, what does the FCRA require of defendants herein? Third, have the defendants failed to comply with those requirements? Fourth, are defendants liable to plaintiff on any of plaintiff's state law claims?

A. Consumer Report

15 U.S.C. § 1681a(d) defines a consumer report as

any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer's eligibility for (1) credit or insurance to be used primarily for personal, family, or household purposes, or (2) employment purposes, or (3) other purposes authorized under section 1681b of this title.

That definition occasions the need to inquire into the motive of the credit reporting agency, here Equifax, because "if at the time the information was collected, the agency expected it to be used for proper purposes, a transmittal of that information would be a consumer report." Heath v. Credit Bureau of Sheridan, Inc., 618 F.2d 693, 696 (10th Cir.1980). The record in this litigation indicates that when Equifax provided ASC...