Robinson v. Pa. Higher Educ. Assistance Agency
| Decision Date | 03 April 2017 |
| Docket Number | Case No.: GJH-15-0079 |
| Parties | ANTHONY ROBINSON, Plaintiff, v. PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY, et al., Defendants. |
| Court | U.S. District Court — District of Maryland |
Plaintiff Anthony Robinson ("Plaintiff" or "Robinson") brings suit against Defendants Pennsylvania Higher Education Assistance Agency d/b/a FedLoan Servicing, the United States Department of Education ("USDE"), Equifax Information Services, LLC, and Experian Information Solutions, Inc.,1 alleging claims under the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., and common law defamation. Defendant USDE has filed a Motion to Dismiss for Lack of Jurisdiction under Fed. R. Civ. P. 12(b)(1). ECF No. 41. No hearing is necessary. See Loc. R. 105.6 (D. Md. 2016). For the following reasons, Defendant's Motion to Dismiss is granted and USDE is dismissed from this action.
At the motion to dismiss stage, the Court takes the allegations in Plaintiff's Amended Complaint as true. Some time prior to November 2011, Robinson "discovered that there were Direct Loan student loan accounts being reported to his Experian, Equifax, and Trans Unioncredit reports." ECF No. 38 ¶ 8. Robinson had not authorized a student loan account to be opened in his name. Id. ¶ 9. In November 2011, Robinson began disputing the Direct Loan accounts with Experian, Equifax, and Trans Union (collectively, the "credit reporting agencies" or "CRAs"), as well as with FedLoan Servicing and Direct Loans directly.2 Id. ¶ 10. In his disputes, Plaintiff stated that the Direct Loan accounts were "fraudulently opened in his name," and that he had only authorized Direct Loan to perform a credit check, not to open a loan account in his name. Id. ¶ 11. Plaintiff requested a description of the CRAs' investigations into these disputes. Id. ¶ 10. Plaintiff also states that upon information and belief, the CRAs forwarded his disputes to FLS for additional investigation. Id. ¶ 12. In April 2014, Plaintiff alleges that he provided a police report, a copy of his driver's license, a copy of his credit reports, and other documents in support of his disputes. Id. ¶ 14.
Plaintiff filed an Amended Complaint in this Court on June 3, 2015. ECF No. 38. USDE filed its Motion to Dismiss for Lack of Jurisdiction on June 12, 2015. ECF No. 41. Plaintiff filed an Opposition to the Motion to Dismiss, ECF No. 46, and USDE filed a Reply. ECF No. 48.3
"It is well established that before a federal court can decide the merits of a claim, the claim must invoke the jurisdiction of the court." Miller v. Brown, 462 F.3d 312, 316 (4th Cir. 2006). Federal Rule of Civil Procedure 12(b)(1) governs motions to dismiss for lack of subject matter jurisdiction. See Khoury v. Meserve, 268 F. Supp. 2d 600, 606 (D. Md. 2003), aff'd, 85 F.App'x 960 (4th Cir. 2004). Once a challenge is made to subject matter jurisdiction, the Plaintiff bears the burden of proving that subject matter jurisdiction exists. See Ferdinand-Davenport v. Children's Guild, 742 F. Supp. 2d 772, 777 (D. Md. 2010) (citing Piney Run Pres. Ass'n v. Cty. Comm'rs of Carroll Cty., Md., 523 F.3d 453, 459 (4th Cir. 2008)). The Court should grant a Rule 12(b)(1) motion "only if the material jurisdictional facts are not in dispute and the moving party is entitled to prevail as a matter of law." Evans v. B.F. Perkins Co., a Div. of Standex Int'l Corp., 166 F.3d 642, 647 (4th Cir. 1999).
"Congress enacted FCRA in 1970 to ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy." Saunders v. Branch Banking and Trust Co. of Va., 526 F.3d 142, 147 (4th Cir. 2008) (citing Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 52 (2007)). The Act imposes civil liability on "any person" who "willfully fails to comply with any requirement imposed under this subchapter with respect to any consumer," § 1681n, or who "is negligent in failing to comply with any requirement imposed under this subchapter," § 1681o. The Act defines "person" to mean "any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity." § 1681a(b). The parties dispute whether "government or governmental subdivision or agency" in the definition of "person" includes the Department of Education, which is a federal agency.
The doctrine of "[s]overeign immunity shields the United States from suit absent a consent to be sued that is 'unequivocally expressed.'" United States v. Bormes, 133 S.Ct. 12, 16(2012) (quoting United States v. Nordic Vill., Inc., 503 U.S. 30, 33 (1992)). "[T]he Government's consent to be sued must be construed strictly in favor of the sovereign, and not enlarged beyond what the statute requires." Nordic Vill., 503 U.S. at 34 (internal quotations omitted). A waiver of sovereign immunity cannot be implied, see United States v. King, 395 U.S. 1, 4 (1969), and "all ambiguities" are to be "resolved in favor of the Government." DePhillips v. United States, No. 8:09-CV-00905, 2009 WL 4505877, at *2 (D. Md. Nov. 24, 2009) (citing Nordic Vill., 503 U.S. at 34)). If sovereign immunity has not been waived, federal courts lack subject matter jurisdiction over the claim. DePhillips, 2009 WL 4505877 at *2 (citing Verlinden B.V. v. Cent. Bank of Nig., 461 U.S. 480, 485 n.5 (1983)); McLean v. United States, 566 F.3d 391, 401-02 (4th Cir. 2009)). In its Motion to Dismiss, Defendant USDE urges the Court to find that the FCRA does not waive sovereign immunity for the federal government and therefore that the Court does not have subject matter jurisdiction. ECF No. 41-1 at 4-14.4
Neither the Supreme Court nor the Fourth Circuit has squarely ruled upon whether the FCRA waives sovereign immunity. See United States v. Bormes, 133 S. Ct. 12, 20 (2012) (); Bormes v. United States, 759 F.3d 793, 795 (7th Cir. 2014) (). In United States v. Bormes, the Supreme Court held that the Little Tucker Act, 28 U.S.C. § 1346(a)(2), which provides that "[t]he district courts shall have original jurisdiction, concurrent with the United States Court of Federal Claims, of . . . [a]ny . . . civil action or claim against the United States, not exceeding $10,000 in amount, founded . . . upon . . . any Act of Congress," does not waive sovereign immunity of the United States with respect to violations of the FCRA. Bormes, 133 S. Ct. at 15.However, the Supreme Court did not decide whether the FCRA itself waives sovereign immunity, and instead remanded that question back to the Seventh Circuit. Id. at 20. The Supreme Court instructed that "[s]ince FCRA is a detailed remedial scheme, only its own text can determine whether the damages liability Congress crafted extends to the Federal Government." Id. at 19 (emphasis in original).
On remand, the Seventh Circuit held that the FCRA waived sovereign immunity. Bormes v. United States, 759 F.3d 793, 795. In so holding, the Seventh Circuit relied on the plain language of the definition "person," which includes "government." Id. The court referenced the history of the FCRA, noting that while Section 1681n, as originally enacted in 1970, applied only against consumer reporting agencies, Congress amended Section 1681n in 1996, expanding liability to all "persons." Id. However, the legislative history did not discuss how this expansion interacted with the existing definition of "person" in § 1681a(b), which encompasses "any . . . government." Id. at 795. The United States, as defendant in Bormes, argued that while it was a "person" for the purposes of the Act's substantive requirements, Congress did not intend for damages liability under § 1681n to also apply to the federal government. The Seventh Circuit responded, "[b]ut if the United States is a 'person' under § 1681a(b) for the purpose of duties, how can it not be one for the purpose of remedies?" Id. at 795. It concluded accordingly, Id. at 796.
The Seventh Circuit's decision in Bormes conflicted with a number of district court opinions on the subject. For example in Stellick v. U.S. Dep't of Educ., No. 11-CV-0730PJS/JJG, 2013 WL 673856, at *1 (D. Minn. Feb. 25, 2013), the court held that although "person" in § 1681a(b) includes "government," this does not constitute Congress's "unequivocal expression" of consent to be sued. See Stellick, 2013 WL 673856, at *3. The court reasoned that when the FCRA was enacted in 1970, its remedial provisions, §§ 1681n and 1681o, applied not to "persons" but to consumer-reporting agencies. Id. At that time, the federal government was not acting as a consumer reporting agency, so it was "understandable . . . why Congress did not think to include within the FCRA a provision explicitly preserving sovereign immunity." Id. Thus, in contrast to the Seventh Circuit's reading of the legislative history, the Stellick court did not read the history to express an unequivocal waiver. The court further reasoned that reading a waiver of sovereign immunity into the statute would impose punitive damages and criminal liability on the United States under § 1681n(a)(2) and § 1681q. Id. at *4. This consequence, in the court's view, "would be immense." Id.; see also Gillert v. U.S. Dep't of Educ., No. CIV. 08-6080, 2010 WL 3582945, at *3 (W.D. Ark. Sept. 7, 2010) (...
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