Moody v. Ascenda USA Inc.
| Citation | 193 F.Supp.3d 1347 |
| Decision Date | 24 June 2016 |
| Docket Number | CASE NO.: 16-cv-60364-WPD |
| Parties | Ashley MOODY and Autumn Terrell, on behalf of themselves and on behalf of all other similarly situated, Plaintiffs, v. ASCENDA USA INC. d/b/a 24-7 Intouch, and Verified Credentials, Inc., Defendants. |
| Court | U.S. District Court — Southern District of Florida |
Leonard A. Bennett, Consumer Litigation Associates, PC, Newport News, VA, Luis A. Cabassa, Brandon J. Hill, Wenzel Fenton Cabassa, P.A., Tampa, FL, for Plaintiffs.
John Drury, Kyle A. Petersen, Pamela Quigley Devata, Seyfarth Shaw LLP, Chicago, IL, Alexandre S. Drummond, Seyfarth Shaw LLP, Atlanta, GA, Suzanne Ashelle Singer, Rumberger Kirk & Caldwell, Brian Michael Ercole, Morgan Lewis, Bockius, Miami, FL, Gregory T. Parks, Morgan, Lewis & Bockius, LLP, Philadelphia, PA, for Defendants.
ORDER DENYING DEFENDANT'S MOTION TO DISMISS
THIS CAUSE is before the Court upon Defendant Verified Credentials, Inc.'s Motion to Dismiss Plaintiff's Third Class Claim for Relief [DE 21], filed herein on April 25, 2016. The Court has carefully considered the Motion [DE 21], Response [DE 35], and Reply [DE 41/44], and is otherwise fully advised in the premises.
On January 25, 2016, Ashley Moody and Autumn Terrell, on behalf of themselves and on behalf of all others similarly situated ("Plaintiffs") brought this action in state court against Ascenda USA Inc. d/b/a 24-7 Intouch ("Defendant Ascenda") and Verified Credentials, Inc. ("Defendant Verified") (collectively "Defendants") pursuant to the Fair Credit Reporting Act of 1970 ("FCRA"), 15 U.S.C. § 1681. See [DE 1-1]. Defendants removed this case to federal court on February 24, 2016 on federal question grounds. See [DE 1]. The Amended Class Action Complaint, the operative pleading in this case, was filed on April 8, 2016. See [DE 15].
The following facts are according to the Plaintiffs' Amended Class Action Complaint: Defendant Verified operates a national database of public records and related employment histories as a nationwide consumer reporting agency ("CRA"), and prepares and furnishes consumer reports for employment and other purposes. ¶ 4. Defendant Verified sells these consumer files in the form of consumer reports to employers wishing to investigate the background and criminal history of job applicants or current employees. ¶ 24-25. Defendant Verified disseminates only the portions of criminal records that the public entities from which it purchases its data choose to provide in bulk. ¶ 51.
Defendant Ascenda operates customer service call centers across the country. ¶ 3. Defendant Ascenda routinely obtains consumer reports from Defendant Verified to conduct background checks on new and existing employees and relies on such informationas a basis for adverse employment action. ¶ 5-6.
Plaintiff Ashley Moody (hereinafter "Plaintiff") was hired by Defendant Ascenda to work at a call center in Florida. ¶ 37. After Plaintiff had been working with the company for several months, Defendant Ascenda obtained a consumer report on her from Defendant Verified as part of a background check. ¶ 42-43. Defendant Verified did not notify Plaintiff that public information about her was being furnished to Defendant Ascenda. ¶ 64. The consumer report compiled by Defendant Verified regarding the Plaintiff contained false and adverse information, stating she had been convicted of petit theft and drug possession. ¶ 45. As a result, Defendant Ascenda suspended Plaintiff from work without pay. ¶ 46. After Plaintiff learned of the report, she contacted Defendant Verified to dispute the information in the report. ¶ 53. Defendant Verified responded that it would only review her dispute of the consumer report if Plaintiff submitted identification first, to which Plaintiff complied. ¶ 53. Less than a week later, Defendant Verified issued a second consumer report to Defendant Ascenda, this time containing no convictions attributed to Plaintiff. ¶ 54. The convictions listed on the original report belonged to someone else. ¶ 45. Defendant Ascenda then allowed Plaintiff to return to work, but refused to compensate Plaintiff for the days she was suspended. ¶ 55. Accordingly, Plaintiff lost hundreds of dollars in pay which she never recovered. ¶ 46.
As a result, Plaintiff brings two claims against Defendant Verified, alleging violations of the FCRA, 15 U.S.C. § 1681. (Counts III and V of the Amended Complaint). In Count III, Plaintiff alleges Defendant Verified violated 15 U.S.C. § 1681k(a), which provides as follows:
15 U.S.C. § 1681k(a).
In Count V, Plaintiff alleges Defendant Verified violated 15 U.S.C. § 1681i which provides as follows:
Plaintiff seeks statutory damages, punitive damages, costs and attorney's fees against Defendant Verified. See [DE 15] at ¶¶ 96-97, 110-12.
On April 25, 2016, Defendant Verified filed the instant Motion to Dismiss Count III, arguing that Plaintiff cannot sustain of claim for a violation under § 1681k(a) because Plaintiff has failed to allege sufficient facts to establish that the information in the consumer report was not complete and up to date.1
To adequately plead a claim for relief, Rule 8(a)(2) requires "a short and plain statement of the claim showing that the pleader is entitled to relief," in order to "give the defendant fair notice of what the ... claim is and the grounds upon which it rests." Conley v. Gibson , 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957). Under Rule 12(b)(6), a motion to dismiss should be granted only if the plaintiff is unable to articulate "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (abrogating Conley , 355 U.S. at 41, 78 S.Ct. 99 ). "A claim has facial plausibility when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal , 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (citing Twombly , 550 U.S. at 556, 127 S.Ct. 1955 ).
The Court need not take allegations as true if they are merely "threadbare recitals of a cause of action's elements, supported by mere conclusory statements." Iqbal , 129 S.Ct. at 1949. In sum, "a district court weighing a motion to dismiss asks ‘not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims.’ " Twombly , 550 U.S. at 563 n. 8, 127 S.Ct. 1955 (quoting Scheuer v. Rhodes , 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974), overruled on other grounds, Davis v. Scherer , 468 U.S. 183, 104 S.Ct. 3012, 82 L.Ed.2d 139 (1984) ).
§ 1681k(a) requires a CRA to either: (1) notify a consumer that information about them is being published; or (2) maintain strict procedures designed to insure that reported information is complete and up to date. See § 1681k(a). Plaintiff alleges that Defendant violated this section because she was never notified that this information was being distributed to the employer and because the information was not complete and up to date, as it contained information that was demonstrably false.
Defendant argues that the § 1681k(a) claim must be dismissed because the claim is based on an improper interpretation of the law. Defendant contends Plaintiff's allegations fail to state a claim for violating § 1681k(a)(2) because this section is not intended to ensure accuracy, but rather, it is intended to ensure that the information actually reported is the current public record status of the item at the time the report is reported. Defendant relies on case law and legislative history to support this proposition. Defendant cites favorably to Doe v. Sterling Infosystems, Inc. , No. 15–cv–4770 (C.D.Cal. Dec. 21, 2015)2 . In Doe , the plaintiff brought a claim under § 1681k(a) based on a CRA's inclusion of erroneous information in his background report. Id. at 1–2. The Doe court held a report is complete and up to date if it reflects the current public record...
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