Taylor v. Inflection Risk Solutions, LLC

• Decision Date: 16 February 2021
• Docket Number: Civ. No. 20-2266 (PAM/DTS)
• Citation: 519 F.Supp.3d 517
• Court: U.S. District Court — District of Minnesota
• Parties: Tony N. TAYLOR, Plaintiff, v. INFLECTION RISK SOLUTIONS, LLC, Defendant.

519 F.Supp.3d 517

Tony N. TAYLOR, Plaintiff,

v.INFLECTION RISK SOLUTIONS, LLC, Defendant.

Civ. No. 20-2266 (PAM/DTS)

United States District Court, D. Minnesota.

Signed February 16, 2021

E. Michelle Drake, John G. Albanese, Berger & Montague, P.C., Minneapolis, MN, John H. Goolsby, Goolsby Law Office, LLC, Saint Paul, MN, for Plaintiff.

Henry Perlowski, Pro Hac Vice, Megan Poitevint Mitchell, Pro Hac Vice, Arnall Golden Gregory LLP, Atlanta, GA, Neil S. Goldsmith, Lathrop Gpm LLP, Minneapolis, MN, for Defendant.

MEMORANDUM AND ORDER

Paul A. Magnuson, United States District Court Judge

This matter is before the Court on Defendant's partial Motion to Dismiss or to Strike. For the following reasons, the Motion is denied.

BACKGROUND

In 2014, Plaintiff Tony Taylor brought his licensed firearm into Minneapolis City Hall, a building that also contains courtrooms. (Am. Compl. (Docket No. 15) ¶ 22.) He and his wife, Sarah Taylor, were subsequently convicted of bringing a weapon into a courthouse in violation of Minn. Stat. § 609.66, subd. 1g(a)(1), which is a felony. (Id. ¶¶ 22-23.) Both received a sentence of probation with a stayed prison term, and both successfully completed their probationary sentences. (Id. ¶¶ 24-27.) Under Minnesota law, such convictions are deemed misdemeanors, Minn. Stat. § 609.13, and according to Taylor, online public court records list the convictions as misdemeanors. (Id. ¶¶ 28-29.)

Defendant Inflection Risk Solutions, LLC conducts criminal background checks for its clients, including Airbnb. In July 2020, Taylor applied to rent an apartment through Airbnb. (Id. ¶ 30.) Inflection conducted a background check, and after receiving that report, Airbnb rejected Taylor's application and permanently barred him from ever renting through Airbnb. (Id. ¶¶ 31, 33.) Taylor received a copy of the background check report, which listed his criminal conviction as a felony. (Id. ¶ 35.) The report also stated that the "offense class" of the conviction was "violence." (Id. ¶ 36.) Taylor disputed the report and Inflection corrected it, but according to Taylor, he remains permanently barred from using Airbnb. (Id. ¶¶ 42-43.)

Taylor's wife also asked Inflection for a criminal background report, which listed the same erroneous information: that her offense was a felony and that the offense class was "violence." (Id. ¶ 47.) Mrs. Taylor disputed her report and Inflection corrected it. (Id. ¶ 49.) Thereafter, Mrs. Taylor sought to rent an apartment through Airbnb and was approved for that rental. (Id. ¶¶ 51-52.)

The Amended Complaint raises two causes of action. Count I alleges that Inflection violated the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1682e(b), by either willfully or negligently reporting as felonies crimes that Minnesota law deems to be misdemeanors. Count II asserts the same statutory violation, alleging that Inflection willfully or negligently mis-reported non-violent offenses as violent offenses.

Taylor seeks to represent two classes: a so-called "deemed misdemeanor" class and an "inaccurate offense characterization" class. (Am. Compl. ¶ 64.) The "deemed misdemeanor" class consists of individuals with Minnesota felony convictions that were ultimately deemed misdemeanors under Minn. Stat. § 609.13, and on whom Infection published an inaccurate background-check report indicating that the offense was a felony. The "inaccurate offense characterization" class comprises individuals on whom Inflection performed a background check that listed a Minnesota criminal offense described as involving violence, but whose conviction was not a crime of violence under Minn. Stat. § 624.712, subd. 5. (Am. Compl. ¶ 64.) Both classes are limited to two years before this case's commencement. (Id. )

Inflection's Motion seeks the dismissal of Count II of the Amended Complaint, or in the alternative to dismiss the request for statutory or punitive damages in Count II, and to strike the class allegations in their entirety.

DISCUSSION

To survive a motion to dismiss under Rule 12(b)(6), a complaint need only "contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ " Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ); see also Fed. R. Civ. P. 12(b)(6). A claim bears facial plausibility when it allows the Court "to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937. When evaluating a motion to dismiss under Rule 12(b)(6), the Court must accept plausible factual allegations as true. Gomez v. Wells Fargo Bank, N.A., 676 F.3d 655, 660 (8th Cir. 2012).

The FCRA mandates that credit-reporting agencies such as Inflection "follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates." 15 U.S.C. § 1681e(b). A reasonable-procedures claim requires a plaintiff to plead and ultimately prove that the defendant failed to follow such reasonable procedures, included inaccurate information in the plaintiff's credit report, and the plaintiff suffered an injury because of that inaccurate information. Gohman v. Equifax Info. Servs., LLC, 395 F. Supp. 2d 822, 826 (D. Minn. 2005) (Doty, J.). The parties agree, however, that a claim asserting a willful violation of the statute does not require proof of any injury, because the FCRA provides for statutory damages for willful violations of its provisions.

A. Count II

1. Crime of Violence

Inflection first argues that Count II fails to state a claim on which relief can be granted, because Inflection's categorization of Taylor's conviction as a violent one is not inaccurate. Taylor in turn contends that Minnesota law defines crime of violence and that his conviction is not included in that definition. The crime-of-violence definition to which he points, Minn. Stat. § 624.712, defines a crime of violence for Minnesota's gun-possession statutes, Minn. Stat. §§ 624.711 - 624.717. It is true that the definition's laundry list of sections of the Minnesota criminal code does not include the section under which Taylor was convicted, Minn. Stat. § 609.66. But as Inflection notes, Taylor was convicted of possessing a "dangerous weapon" in a courthouse, Minn. Stat. § 609.66, subd. 1g, and Minnesota law defines a "dangerous weapon" as one "capable of producing death or great bodily harm." Minn. Stat. § 609.02. Black's Law Dictionary defines "violent crime" in part as the "threatened use, or substantial risk of use of physical force." (Def.’s Supp. Mem. (Docket No. 20) at 12.) Thus, Inflection asserts that Taylor's crime fits the general definition of crime of violence and it was not inaccurate for Inflection to include that notation in its background-check report.

Taylor's response is that the "offense class" category is one of Inflection's own making. To put it differently, although Inflection represents that its reports are merely a copy of public records, there is no "offense class" in Minnesota's criminal records, so Inflection must have created that category itself. As such, Taylor argues, Inflection had a duty to ensure that it accurately represented the so-called "offense class." And here, there is no indication in any public record that Taylor's crime was a violent one, except for the statute's use of the term "dangerous weapon" in the definition of the crime itself. Taylor claims that, having endeavored to classify the crimes it is reporting, the FCRA required Inflection to make certain that its classifications were accurate.

On a Motion to Dismiss, the Court must take the allegations in the Amended Complaint as true and construe those allegations in favor of Taylor. It is plausible that, as Taylor alleges, Inflection did not use reasonable procedures when determining what offenses fit the "offense class" of "violence." Taylor is entitled to discovery as to how Inflection makes this offense-categorization judgment and whether Inflection acted reasonably to ensure, as the FCRA requires, "maximum possible accuracy" in that categorization judgment and the subsequent reporting of the categorization decision to its clients.

2. Willfulness

In the alternative, Inflection asks for dismissal of the statutory and punitive damages associated with Count II. Inflection contends that any alleged inaccuracy in categorizing Taylor's conviction as one involving...