Sanchez v. JP Morgan Chase Bank

• Docket Number: 3:22-cv-1396 (SRU)
• Decision Date: 15 September 2023
• Citation: Sanchez v. JP Morgan Chase Bank, 3:22-cv-1396 (SRU) (D. Conn. Sep 15, 2023)
• Parties: VIOLETA SANCHEZ, Plaintiff, v. JPMORGAN CHASE BANK, N.A., et al., Defendants.
• Court: U.S. District Court — District of Connecticut

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VIOLETA SANCHEZ, Plaintiff, v. JPMORGAN CHASE BANK, N.A., et al., Defendants.

No. 3:22-cv-1396 (SRU)

United States District Court, D. Connecticut

September 15, 2023

ORDER ON MOTIONS TO DISMISS

Stefan R. Underhill United States District Judge

Violeta Sanchez(“Sanchez”) filed two claims of violations of the Fair Credit Reporting Act (“FCRA”) against her bank, JPMorgan Chase Bank N.A.(“Chase”), and three credit reporting agencies, Equifax Information Services, LLC(“Equifax”), Experian Information Solutions, Inc.(“Experian”), and Trans Union, LLC(“Trans Union”).Sanchez brings her claims pursuant to sections 1681s-2(b)and1681i of the FCRA.The defendants have filed motions to dismiss for failure to state a claim.SeeDoc. No. 26;Doc. No. 42.For the reasons set forth below the defendants' motions to dismiss are granted, and Sanchez's complaint is dismissed with prejudice.

I.Standard of Review

“When deciding a motion to dismiss under Rule 12(b)(6), the court must accept the material facts alleged in the complaint as true, draw all reasonable inferences in favor of the plaintiffs, and decide whether it is plausible that plaintiffs have a valid claim for relief.”Zuro v. Town of Darien, 432 F.Supp.3d 116, 121(D. Conn.2020)(citingAshcroft v. Iqbal, 556 U.S. 662, 678-79(2009);Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555-56(2007);Leeds v. Meltz, 85 F.3d 51, 53(2d Cir.1996)).However, “[w]here a conclusory allegation in the complaint conflicts with a statement made in a document attached to the complaint, the document controls and the allegation is not accepted as true.”Francis v. Carusso, 2022 WL 16716172, at *10(D. Conn.Nov. 4, 2022)(quotingAmidax Trading Grp. v. S.W.I.F.T. SCRL, 607 F.Supp.2d 500, 502(S.D.N.Y.2009)).Additionally, “[f]actual allegations must be enough to raise a right to relief above the speculative level,” and a plaintiff's “formulaic recitation of the elements of a cause of action will not do.”Twombly, 550 U.S. at 555.

II.Background

This case involves a Fair Credit Reporting Act (“FCRA”) action brought by Sanchez against defendants Chase, Equifax, Experian, and Trans Union.The latter three defendants are credit reporting agencies (“CRAs”).Sanchez sets forth two causes of action in her complaint: (1) violation of FCRAsection 1681s-2(b) against Chase; and (2) violations of FCRAsection 1681i against the CRA defendants.See generallyDoc. No. 1.

Sanchez alleges that she received three debt collection letters from Chase regarding a delinquent account: one on August 18, 2020, one on July 19, 2021, and one on July 27, 2022.Id. at ¶¶ 19-23;see alsoDoc.No. 43-1(defendants' attachment of August 18, 2020 and July 19, 2021 letters).According to Sanchez, all three debt collection letters informed Sanchez “that the statute of limitations had expired on [her] Chase account.”Id.at ¶¶ 19-24;see alsoDoc. No. 431.^[1] The letters state that “[t]he unpaid balance” on the account is “$9,455.28.”Doc.No. 43-1.Additionally, in the letters, the bank offers Sanchez an opportunity to pay $2,364.71 so that the balance will be erased.Id.At the bottom of the letters is the following disclosure: “THE LAW LIMITS HOW LONG YOU CAN BE SUED ON A DEBT.EVEN IF YOU MAKE A PAYMENT, BECAUSE OF THE AGE OF YOUR DEBT, WE WILL NOT SUE YOU FOR IT.

IF YOU DO NOT PAY THE DEBT, WE MAY CONTINUE TO REPORT IT TO THE CREDIT REPORTING AGENCIES.”^[2]Id.

Despite receiving those letters from Chase, Sanchez “ran her Equifax, Experian, and Trans Union credit reports and noticed that . . . Defendant Chase was not reporting the statute of limitations as being expired for the Chase account.”Id.at ¶ 25.Sanchez alleges that all three CRA defendants are likely still reporting an inaccurate status for her account.Id.at ¶¶ 27-29.

Sanchez attempted to dispute the results of her credit reports with each of the CRA defendants, to no avail.She wrote to Equifax on February 24, 2020, September 1, 2020, and September 7, 2021, informing Equifax of the inaccuracy and requesting that Equifax remove the inaccurate information from her credit report.Id.at ¶¶ 30, 32, 34.In her September 1, 2020 correspondence, she“enclosed Chase's August 18, 2020 debt collection letter,” and in her September 7, 2021 correspondence, she“enclosed Chase's July 19, 2021 debt collection letter.”Id.at ¶¶ 32, 34.Equifax sent Sanchez the result of her dispute on September 24, 2021, concluding that the credit report was accurate.Id.at ¶ 35.Equifax's credit reports for Sanchez therefore do not report the expiration of the statute of limitations.Id.

Sanchez wrote to Experian on February 24, 2020 and September 1, 2020, disputing the results of her credit report and, in her September 2020 correspondence, enclosing the August 18, 2020 debt collection letter from Chase.Id. at ¶¶ 36-38.On October 2, 2020, Sanchez received the result of her dispute from Experian, in which Experian concluded that the credit report was accurate as is.Id.at ¶ 39.On September 7, 2021, Sanchez again disputed the Experian credit report, enclosing the July 19, 2021 Chase debt collection letter and requesting that Experian fix the inaccuracy.Id.at ¶ 40.Sanchez received the results of her dispute with Experian on October 20, 2021, in which Experian verified that the credit report was accurate.Id.at ¶ 41.Experian's credit reports therefore do not report the expiration of the statute of limitations.Id.

Sanchez wrote to Trans Union on February 24, 2020 to report the inaccuracy.Id.at ¶ 42.She received her dispute results from Trans Union on March 27, 2020, in which Trans Union verified the credit report as is.Id. at ¶ 43.On September 1, 2020, Sanchez again wrote to Trans Union, enclosing the August 18, 2020 debt collection letter from Chase.Id.at ¶ 44.She received dispute results from Trans Union on September 29, 2020, in which Trans Union again verified the credit report.Id. at ¶ 45.She wrote to Trans Union an additional time on September 7, 2021, enclosing the July 19, 2021 debt collection letter from Chase.Id.at ¶ 46.She again received dispute results from Trans Union on September 24, 2021 verifying the original credit report.Id.at ¶ 47.Trans Union's reports therefore do not report the expiration of the statute of limitations.Id.

III.Discussion

The defendants have filed motions to dismiss Sanchez's complaint for failure to state a claim.SeeDoc. No. 27;Doc. No. 43.As explained in further detail below, the defendants' motions are granted and Sanchez's complaint is dismissed.

Sanchez brings two principal FCRA claims against the defendants: a claim of violation of 15 U.S.C. § 1681s-2(b) against Chase, the furnisher of her information; and a claim of violation of 15 U.S.C. § 1681i against Equifax, Experian, and Trans Union, three CRAs.See generallyDoc. No. 1.In its motion to dismiss, Chase argues that Sanchez failed to state a claim because she did not allege a factual inaccuracy.See generallyDoc. No. 27.In their motion to dismiss, the CRA defendants similarly argue that the expiration of the statute of limitations is not a factual inaccuracy, as well as that the CRA agencies do not have an obligation under the FRCA to verify that the statute of limitations had expired.See generallyDoc. No. 43.

In her claim against Chase, Sanchez argues that Chase willfully, and in the alternative, negligently, violated section 1681s-2(b) of the FCRA.SeeDoc. No. 1 at ¶¶ 57-58.Sanchez brings her claim pursuant to a provision of the FCRA that provides a cause of action against a furnisher for information they report after they receive notice of a dispute from a CRA.See15 U.S.C. § 1681s-2(b).Courts within this circuit have held that “[t]o state a claim against a furnisher under [section 1681s-2(b)], ‘a consumer must show that (1) a furnisher received notice of a credit dispute from a [credit reporting agency](as opposed to from the consumer alone) and (2) the furnisher negligently or willfully failed to conduct a reasonable investigation.'”Tescher v. Experian Info. Sols., Inc., 2022 WL 564048, at *6(S.D.N.Y.Feb. 23, 2022)(quotingNgambo v. Chase, 2020 WL 1940553, at *3(S.D.N.Y.Apr. 22, 2020))(collecting cases).At the pleading stage, a plaintiff can claim that a furnisher “negligently or willfully failed to conduct a reasonable investigation” by alleging that a furnisher was notified by a CRA of an inaccuracy, that the furnisher failed to conduct a reasonable investigation and continued reporting the inaccuracy, and that the CRA then continued reporting the inaccuracy.Id. at *7.

In her claim against the CRA defendants, Sanchez argues that the CRA defendants willfully and negligently violated section 1681i of the Fair Credit Reporting Act.SeeDoc. No. 1 at ¶¶ 64-65;15 U.S.C. § 1681i.Section 1681i outlines “procedures” CRAs must follow “includ[ing] reinvestigating a consumer's record within a reasonable period of time after a consumer ‘directly conveys' a dispute as to the ‘completeness or accuracy of an item on his credit report' to the consumer reporting agency.”Khan v. Equifax Info. Servs., LLC,2019 WL 2492762, at *3(E.D.N.Y.June 14, 2019).Section 1681i provides in relevant part that “if the completeness or accuracy of any item of information contained in a consumer's file at a consumer reporting agency is disputed by the consumer and the consumer notifies the agency . . . of such dispute, the agency shall . . . conduct a reasonable reinvestigation to determine whether the disputed information is inaccurate and record the current status of the disputed information, or delete the item from the file” within 30 days of notice of the dispute.15 U.S.C. § 1681i(a)(1)(A).The CRA must also provide “[p]rompt notice of [...