Swainson v. LendingClub Corp., Civil Action 21 Civ. 5379 (GHW) (SLC)

CourtUnited States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
PartiesRAYMOND SWAINSON, Plaintiff, v. LENDINGCLUB CORPORATION, et al., Defendants.
Docket NumberCivil Action 21 Civ. 5379 (GHW) (SLC)
Decision Date24 June 2022



Civil Action No. 21 Civ. 5379 (GHW) (SLC)

United States District Court, S.D. New York

June 24, 2022



TO THE HONORABLE GREGORY H. WOODS, United States District Judge:


Pro se Plaintiff Raymond E. Swainson (“Mr. Swainson”) filed this action asserting claims under the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., and the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681 et seq., seeking economic damages against the following Defendants: (1) LendingClub Corporation (“LendingClub”), (2) TransUnion, LLC (“TransUnion”), (3) Equifax Information Services LLC (“Equifax”), and (4) Experian (TransUnion, Equifax, and Experian, together, the “Credit Bureaus,” LendingClub and the Credit Bureaus together, “Defendants”). (ECF No. 18 at 2-4, 7 (the “Amended Complaint”)).[1] Mr. Swainson's claims are predicated on his allegations, that inter alia, LendingClub (i) inaccurately reported late payments to the Credit Bureaus, and (ii) made an unauthorized charge to Mr. Swainson's account. (Id. at 5-6).


Mr. Swainson has settled his claims with Experian and Equifax. (ECF Nos. 44; 48). TransUnion has now moved to dismiss the Amended Complaint for lack of subject matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1) and for failure to state claim pursuant to Federal Rule of Civil Procedure 12(b)(6). (ECF No. 45 (the “Motion”)). Mr. Swainson opposed the Motion. (ECF No. 50 (the “Opposition”)). TransUnion filed a reply in support of the Motion. (ECF No. 51 (the “Reply”)).

For the reasons set forth below, I respectfully recommend that the Motion be GRANTED.


A. Factual Background

The Court summarizes the factual background of Mr. Swainson's claims based on the allegations in his Amended Complaint (ECF No. 18), which the Court accepts as true for purposes of the Motion. See N.J. Carpenters Health Fund v. Royal Bank of Scot. Grp., PLC, 709 F.3d 109, 119-20 (2d Cir. 2013); see also Corbett v. City of N.Y., No. 15 Civ. 09214 (GHW), 2016 WL 7429447, at *2-3 (S.D.N.Y. Dec. 22, 2016). In addition, because Mr. Swainson is pro se, the Court may consider and include in this summary “factual allegations contained in [his] opposition papers and other court filings.” Rodriguez v. Rodriguez, No. 10 Civ. 891 (LGS), 2013 WL 4779639, at *1 (S.D.N.Y. July 8, 2013); see Davila v. Lang, 343 F.Supp.3d 254, 267 (S.D.N.Y. 2018) (“Because [Plaintiff] is proceeding pro se, the Court may consider new facts raised in opposition papers to the extent that they are consistent with the complaint, treating the new factual allegations as amending the original complaint.”).


1. Mr. Swainson's Payments

In October 2020, Mr. Swainson and LendingClub executed a “Hardship Agreement” (the “Agreement”). (ECF No. 18 at 5). According to the Agreement, Mr. Swainson was responsible for paying off a pre-existing debt[2] as follows: (i) payment at a reduced rate of $542 for two months, October and November 2020, (ii) payment of $1,084.07 for one month, December 2020, and (iii) payment of the remaining balance by January 2021. (Id.) If Mr. Swainson made these payments, the Agreement prohibited LendingClub from reporting them as late payments to the Credit Bureaus. (Id.)

On October 9, 2020, Mr. Swainson made a payment of $1,084.07 to LendingClub attributable to the October and November obligations. (ECF No. 18 ¶ 2). LendingClub reported to the Credit Bureaus the October payment as 30 days late, which Mr. Swainson alleges was “inaccurate[]”, but reported the November payment as “on time.” (ECF No. 18 ¶¶ 3-4). On December 1, 2020, Mr. Swainson made a payment of $1,084.07 to LendingClub to satisfy the December obligation. (ECF No. 18 ¶ 5). LendingClub reported to the Credit Bureaus the December payment as 60 days late, and charged Mr. Swainson $133.19. (ECF No. 18 ¶¶ 6-7). By January 2021, Mr. Swainson paid off the remaining balance on the account. (ECF No. 18 ¶ 8).

2. Mr. Swainson's Complaint to TransUnion

At some point, Mr. Swainson filed a complaint with TransUnion, which confirmed receipt on November 27, 2020. (ECF No. 50 at 2). To date, Mr. Swainson has not received a response from TransUnion regarding his complaint. (Id.)


B. Procedural Background

On January 11, 2021, Mr. Swainson commenced an action in Civil Court of the City of New York, County of New York against the Defendants alleging “[d]amage to credit caused by erroneous and inaccurate reporting of accounts, incomplete and not up-to-date account” against the Defendants. (ECF No. 1-1 at 2 (the “Complaint”)). On June 17, 2021, Experian removed the case to this court. (See generally ECF No. 1). On July 12, 2021, LendingClub filed a Motion for a More Definite Statement. (ECF No. 6 (the “LendingClub Motion”)).

On July 29, 2021, the Court held a discovery conference with the parties and denied without prejudice the LendingClub Motion, and directed Mr. Swainson to (i) file proof that he had served TransUnion and Equifax by August 2, 2021, and (ii) file an amended complaint by August 5, 2021. (ECF No. 16). On July 30, 2021, Mr. Swainson filed the Amended Complaint asserting two claims against the Defendants: (1) violation of the FCRA, pursuant to 15 U.S.C. § 1681 et seq. (the “FCRA Claim”) (ECF No. 18 at 2); and (2) violation of the FDCPA, pursuant to 15 U.S.C. § 1692 et seq. (the “FDCPA Claim”). (Id.)

On August 5, 2021, Mr. Swainson effected service of the Amended Complaint on TransUnion and Equifax. (ECF Nos. 19-20). On August 26, 2021, Equifax, Experian, and LendingClub filed their respective Answers to the Amended Complaint. (ECF Nos. 25-27).

On September 10, 2021, and October 7, 2021, Experian and Equifax, respectively, advised the Court that they each reached settlements with Mr. Swainson. (ECF Nos. 28; 34). The Honorable Gregory H. Woods approved stipulations of dismissal as to Experian on November 15, 2021 (ECF No. 44), and as to Equifax on January 13, 2022. (ECF No. 48).


On November 22, 2021, TransUnion, the only remaining Credit Bureau defendant, filed the Motion. (ECF No. 45). On February 22, 2022, the Court docketed Mr. Swainson's Opposition. (ECF No. 50). On March 1, 2022, TransUnion filed its Reply. (ECF No. 51).

On July 12, 2021, Judge Woods referred this matter to the undersigned for general pretrial supervision and to issue a Report and Recommendation on all dispositive motions including the Motion. (ECF No. 8).


A. Federal Rule of Civil Procedure 12(b)(1)

“Federal courts are courts of limited jurisdiction and may not preside over cases absent subject matter jurisdiction.” Zhimin Cheng v. Flushing Main St. Post Off., USPS, No. 16 Civ. 1975 (LDH) (CLP), 2017 WL 4350267, at *2 (E.D.N.Y. Apr. 12, 2017); see Makarova v. United States, 201 F.3d 110, 113 (2d Cir. 2000) (“A case is properly dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) when the district court lacks the statutory or constitutional power to adjudicate it.”). “Normally, motions to dismiss for lack of jurisdiction pursuant to [Rule] 12(b)(1) must be decided before motions pursuant to other Federal Rules of Civil Procedure are considered, since dismissal of an action for lack of subject matter jurisdiction will render all other accompanying defenses and motions moot.” Morelli v. Alters, No. 19 Civ. 10707 (GHW), 2020 WL 1285513, at *6 (S.D.N.Y. Mar. 18, 2020) (quoting Liberty Ridge LLC v. RealTech Sys. Corp., 173 F.Supp.2d 129, 134 (S.D.N.Y. 2001)). The party asserting subject matter jurisdiction bears the “burden of proving by a preponderance of the evidence that it exists.” Grgurev v. Licul, No. 15 Civ. 9805 (GHW), 2020 WL 1922688, at *2 (S.D.N.Y. Apr. 21, 2020). When considering a motion


made pursuant to Rule 12(b)(1), “the Court may consider evidence outside the pleadings.” Ryan v. United States, No. 15 Civ. 2248 (GHW), 2015 WL 7871041, at *3 (S.D.N.Y. Dec. 3, 2015).

B. Federal Rule of Civil Procedure 12(b)(6)

In reviewing a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the Court accepts as true all factual allegations in the complaint and draws all reasonable inferences in favor of the plaintiff. See N.J. Carpenters, 709 F.3d at 119-20; see State St. Glob. Advisors Tr. Co. v. Visbal, 431 F.Supp.3d 322, 334 (S.D.N.Y. 2020). To survive a motion to dismiss, “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Fabian v. Pappalardo, 395 F.Supp.3d 257, 262 (S.D.N.Y. 2019) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). A claim has “facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678; see Adweek LLC v. Carnyx Grp. Ltd., No. 18 Civ. 09923 (GHW), 2019 WL 8405297, at *1 (S.D.N.Y. June 3, 2019).

Under Rule 8(a), a plaintiff must set forth a “short and plain statement of the claim[,]” Fed.R.Civ.P. 8(a), “with sufficient factual ‘heft to sho[w] that the pleader is intitled to relief.'” Trujillo v. City of N.Y., No. 14 Civ. 8501 (PGG), 2016 WL 10703308, at *4 (S.D.N.Y. Mar. 29, 2016), aff'd, 696 Fed.Appx. 560 (2d Cir. 2017) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007) (internal citation omitted)). A complaint “cannot withstand a motion to dismiss unless it contains factual allegations sufficient to raise a ‘right to relief above the speculative level[,]"' Blackson v. City of N.Y., No. 14 Civ. 452 (VEC), 2014 WL 6772256, at *2 (S.D.N.Y. Dec. 2, 2014) (quoting Twombly, 550 U.S. at 555), and present “enough facts to state a claim to relief that is plausible on its face.” Boykin v. KeyCorp, 521 F.3d 202, 213 (2d Cir. 2008) (quoting Twomb...

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