Moore v. Beneficial Nat. Bank USA

• Decision Date: 21 February 1995
• Docket Number: No. CV-94-A-1050-N.,CV-94-A-1050-N.
• Parties: Isabell T. MOORE, Plaintiff, v. BENEFICIAL NATIONAL BANK USA, et al., Defendants.
• Court: U.S. District Court — Middle District of Alabama

876 F. Supp. 1247

Isabell T. MOORE, Plaintiff, v. BENEFICIAL NATIONAL BANK USA, et al., Defendants.

No. CV-94-A-1050-N.

United States District Court, M.D. Alabama, Northern Division.

February 21, 1995.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Joseph B. Lewis, Montgomery, AL, for plaintiff.

Cecil H. Macoy, Jr, William A. Robinson, Birmingham, AL, Scott R. Talkington, Montgomery, AL, for defendants.

MEMORANDUM OPINION

ALBRITTON, District Judge.

I. INTRODUCTION

This cause is now before the court on two Motions for Summary Judgment and a Motion to Strike. On January 13, 1995, Defendant, Rhodes Financial Services Corp. and Rhodes, Inc. (collectively "Rhodes") submitted a Motion for Summary Judgment. On that same date, Defendant, Beneficial National Bank USA ("BNBUSA") filed its own Motion for Summary Judgment. On February 9, 1995, BNBUSA filed a Motion to Strike certain portions of the affidavit of Isabell Moore which accompanied her opposition to the summary judgment motions.

On July 5, 1994, Isabell T. Moore ("Moore") filed a complaint in Montgomery County Circuit Court. In the complaint, Moore alleges breach of contract, defamation, violation of the Fair Credit Reporting Act, and intentional infliction of emotional distress. Specifically, Moore contends that the defendants reported negative credit information to credit reporting agencies and that despite a contractual agreement to delete such information, the information remained on Moore's credit history causing her to be denied credit and to suffer humiliation and emotional distress. Rhodes and BNBUSA removed the case to federal court on the basis of both diversity and federal question jurisdiction.

For the following reasons, the court finds that BNBUSA's Motion for Summary Judgment is due to be GRANTED. Rhodes' Motion for Summary Judgment is due to be GRANTED in part and DENIED in part. The court also finds that the Motion to Strike is due to be GRANTED in part and DENIED in part.

II. FACTS

The court has carefully considered all deposition excerpts, affidavits, and documents submitted in support of and in opposition to the Motions for Summary Judgment. The submissions, viewed in the light most favorable to the plaintiff, establish the following facts:

Rhodes is in the retail furniture business. Prior to June 1992, Rhodes regularly assembled and/or evaluated consumer credit information in connection with its furniture sales. (Rhodes' Ex. K). Prior to June 1992, Rhodes also utilized consumer credit reporting information which it obtained from consumer credit reporting agencies to evaluate the credit worthiness of potential retail furniture customers. Id. On June 22, 1992, Rhodes sold all of its receivables to BNBUSA. Id. After this sale, BNBUSA paid Rhodes a fee for Rhodes' ongoing receivables and then BNBUSA collected the receivables for itself. Id. After this sale, Rhodes no longer assembled, evaluated or used consumer credit information as it had previously. Id. At no time relevant to the allegations of this complaint, did BNBUSA act as Rhodes' agent for purposes of collecting Rhodes' receivables, nor did Rhodes retain any right of control over BNBUSA's collection of receivables which belonged to Rhodes prior to the sale. Id. Since June 22, 1992, BNBUSA has collected on the receivables which it acquired from Rhodes. Id.

Through no fault of her own, Moore acquired an account with a balance due at Rhodes. Moore married James Pratt ("Pratt") and remained married to him until February 21, 1992 when their marriage was dissolved by a Final Decree of Divorce. The Divorce Decree incorporated a Property Settlement Agreement whereby Moore and Pratt agreed that there were no joint debts of the marriage and that any debts of either party in his individual name would be the party's exclusive responsibility. Pratt had a charge account with Rhodes. At all times during Moore's marriage to Pratt this account was in Pratt's name alone. At some point after the divorce, Pratt arranged to have Rhodes substitute Moore for him as the obligor on his credit account. Pratt did this without Moore's consent or knowledge even though it apparently violated the Property Settlement Agreement. Through May, 1992, Rhodes sent monthly invoices to Moore on the account. The total charge on the invoices was $1,262.89. After the sale of Rhodes' accounts receivable, BNBUSA sent Moore its first payment request in June of 1992.

Moore's First Suit

In September of 1992, Moore filed suit in Montgomery County against Pratt, Rhodes, and other creditors with whom she was having problems related to the divorce. Moore sought, inter alia, discharge from all obligation to pay for Pratt's Rhodes account and deletion from her credit records of any negative credit history or rating relating to this account. Moore also sought injunctive relief against further efforts by Pratt to shift his debt to her and damages from Pratt for defamation.

On January 11, 1993, Moore entered into a pro tanto settlement agreement with Rhodes. Although Moore's suit named BNBUSA as a defendant, BNBUSA was not a party to the pro tanto release between Rhodes and Moore. BNBUSA did not agree to delete anything from Moore's credit reports. Pursuant to the settlement agreement, Moore released Rhodes and its officers, agents, representatives, employees, servants, assigns, administrators, and successors from any and all liability of every kind, character, nature and description whatsoever, whether known or unknown, growing out of the facts and circumstances in the complaint. In return Rhodes agreed: to delete and/or withdraw from all credit records any negative reference to Moore's credit history or rating; to discharge Moore from all obligations to pay for products purchased on the Rhodes account; and to refrain from the collection of this debt. Moore and Rhodes filed a Joint Motion to Dismiss with Prejudice which the circuit judge granted on January 19, 1993. It is undisputed that since the Rhodes/Moore settlement, Rhodes has refrained from attempting to collect any debt owed by either Moore or Pratt in connection with the Rhodes account.

After successfully negotiating a settlement with Pratt, Moore filed a Motion for a Final Order in February 1994 wherein she asked the court to entered an order with judgment in favor of Moore against Pratt for the agreed amount. She also asked the court to dismiss with prejudice all remaining claims and issues in the cause. On March 29, 1994, Judge Reese of the Montgomery County Circuit Court entered a Final Order. This order described the terms of the settlement agreement between Moore and Pratt. Additionally, the order states that "all other claims as between the parties hereto are DISMISSED with prejudice."

Before Rhodes' corporate headquarters could authorize the deletion of any reference to the indebtedness, the Operations Manager of the Montgomery store, Jan Wise ("Wise") needed to send the signed pro tanto release and Motion to Dismiss to the Rhodes corporate headquarters. (Rhodes' Ex. K). Rhodes admits that Wise never sent these documents to the corporate headquarters. Id. At the time of the settlement of Moore's first suit, Wise was in the process of being transferred to a Rhodes store in a different state. Id. Wise avers that at the time she left the Montgomery store she had not yet received copies of the pro tanto release and Motion to Dismiss. (Rhodes' Ex. D). Wise further affirms that her replacement at the Montgomery store was aware that the documents were expected and needed to be sent to Atlanta. Id. Somehow, the documents never arrived in Atlanta. Thus, Rhodes inadvertently failed to instruct any credit reporting agencies to delete references to the Rhodes account from Moore's credit history. Id.

Moore's Subsequent Problems

In her affidavit, Moore describes a time in mid-February 1993 when she attempted to purchase clothing at Gayfer's, a department store, by opening a line of credit. Moore states that she could not get a Gayfer's charge account because of a negative credit history. As a consequence of the rejection of her credit application, Moore felt humiliated and embarrassed in front of the friend with whom she was shopping. She was also required to place the clothes that she had planned to purchase back on the rack.

Moore avers that on June 15, 1993 she applied for cellular phone service with Alltel Mobile ("Alltel"). She avers that she was not able to get cellular telephone service. (Moore Aff. p. 119). In her affidavit, Moore attests that she was embarrassed, publicly humiliated, frustrated and degraded by her unsuccessful attempt to procure cellular phone service. After she unsuccessfully submitted her application, Moore contacted the credit bureau and learned that the negative credit history that Rhodes had agreed to delete was still appearing on Moore's credit profile.

Moore avers that as a result of the defendants' failure to delete the negative credit information from her credit history she has suffered in many ways. She cannot sleep. She developed severe stress-related headaches and lost weight. She suffers from upset stomach, nausea, and depression.

Moore filed the instant suit after she discovered that Rhodes had failed to delete references to the Rhodes Account from her credit history with various credit reporting agencies. Moore contacted TRW, Inc. in January, 1994. When she received a copy of a report detailing her credit history, she learned that Rhodes had failed to delete references to the Rhodes account from her credit history with TRW, Inc. This credit report showed that she had an account with Rhodes which was past due and written off as uncollectible.

After she discovered that the information had not been deleted, Moore contacted an attorney and initiated this suit. She did not contact the defendants in an attempt to have them correct the information. (Moore Dep. p. 84-85). Rhodes states that...