Wiggins v. District Cablevision, Inc.

Decision Date13 May 1994
Docket NumberCiv. A. No. 92-75.
PartiesJames Russell WIGGINS, Jr., Plaintiff, v. DISTRICT CABLEVISION, INC., a District of Columbia Corporation; District Cablevision, a District of Columbia Limited Partnership; T.C.I. of D.C., Inc., a District of Columbia Corporation, T.C.I., East, Inc.; A. Bruce Osborn, Defendants.
CourtU.S. District Court — District of Columbia



John C. LaPrade, Washington, DC, Frazier Walton, Jr., Alexandria, VA, for plaintiff.

Burt H. Whitt, Kaufman Canoles, Norfolk, VA, Thomas Patrick Murphy, Reed, Smith, Shaw & McClay, McLean, VA, William Joseph Dean, Grad, Logan & Klewans, Alexandria, VA, for defendants.


LAMBERTH, District Judge.

This matter comes before the court on plaintiff's motion for leave to amend his complaint and defendants' motions to dismiss plaintiff's First Amended Complaint ("Complaint") for failure to state a claim upon which relief can be granted, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Upon consideration of the filings of counsel and the relevant law, plaintiff's motion for leave to amend is denied, and defendants' motions to dismiss will be granted in part and denied in part in accordance with this memorandum opinion.

I. Introduction.

Counts one and two of the Complaint allege violations of the Fair Credit Reporting Act (hereinafter "FCRA" or "the Act"). 15 U.S.C.A. §§ 1681-1681t (1982). In addition, count two alleges conspiracy to violate the FCRA, conspiracy to interfere with plaintiff's employment, and a common-law, breach-of-employment contract claim.1 Count three alleges a common law defamation claim. In count four, plaintiff claims that the defendants maliciously and tortiously interfered with plaintiff's employment contract, and in count five plaintiff asserts a common-law fraud cause of action.

A. Motion to Dismiss

Plaintiff's factual allegations must be presumed true and liberally construed in favor of the plaintiff when reviewing the adequacy of a complaint for purposes of a Rule 12(b)(6) motion. Phillips v. Bureau of Prisons, 591 F.2d 966, 968 (D.C.Cir.1979) (citing Miree v. DeKalb County, Georgia, 433 U.S. 25, 27 n. 2, 97 S.Ct. 2490, 2492 n. 2, 53 L.Ed.2d 557 (1977)). In addition, the plaintiff must be given every favorable inference that may be drawn from his allegations of fact. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974). "However, legal conclusions, deductions or opinions couched as factual allegations are not given a presumption of truthfulness." 2A Moore's Federal Practice, § 12.07, at 63 (2d ed. 1986) (footnote omitted); see Haynesworth v. Miller, 820 F.2d 1245, 1254 (D.C.Cir.1987) (citing Pauling v. McElroy, 278 F.2d 252, 254 (D.C.Cir.), cert. denied, 364 U.S. 835, 81 S.Ct. 61, 5 L.Ed.2d 60 (1960)).

Dismissal is only appropriate if it appears beyond doubt that no set of facts proffered in support of plaintiff's claim would entitle him to relief. Haynesworth, 820 F.2d at 1254 (citations omitted); Phillips, 591 F.2d at 968. Plaintiff's factual allegations are set out below.

B. Facts

In December 1989, plaintiff James Russell Wiggins, Jr., was hired by defendants2 as a salesperson. Compl. ¶ 11. Defendants informed Mr. Wiggins of their intent to do a background check in connection with offering him employment, including a criminal and motor vehicle record check. Id. The Equifax Services, Inc. ("ESI") report "indicated that Plaintiff had a felony cocaine conviction."3 Id. ¶ 12. When defendants advised Mr. Wiggins of this information, he denied having any criminal record. Id. ¶ 13.

According to plaintiff, defendants were aware of the inaccuracies contained in the Equifax report on January 12, 1990, yet they failed to expunge the alleged conviction from plaintiff's personnel file. Id. ¶¶ 15, 40. Defendants then terminated Mr. Wiggins on January 18, 1990. Id. ¶¶ 15, 29, 32(c).

In mid-January 1990, defendants allegedly contacted another of Mr. Wiggins' employers, Philip Morris, Inc., and relayed the erroneous conviction information contained in the report, despite defendants' knowledge of the inaccuracy of the information.4 Id. ¶¶ 16, 35, 48. Thereafter Philip Morris discharged plaintiff on February 6, 1990. Id. ¶¶ 39, 49-50.

In an attempt to cover up their involvement in the aforementioned acts, defendants supposedly made false entries in plaintiff's employment records in March 1990. Id. ¶¶ 32(f), 53. Plaintiff now seeks $35 million dollars in damages.

II. Willful Violations of the Act.

Count one alleges willful violations of section 1681m(a)-(c) of the Act. Plaintiff claims that defendants' willful violations are threefold: First, defendants did not give plaintiff required notice under the Act and made "no disclosure ... in connection with plaintiff's rights" when they fired him, id. ¶ 19; second, defendants willfully failed to give plaintiff appropriate notice of his right to make a written request challenging the incorrect information contained in the consumer report at the time the adverse action was communicated to him, id. ¶¶ 17, 19; and third, defendants "neither had nor used any `reasonable procedure' to assure compliance" with 15 U.S.C.A. § 1681m(a) and (b) "as required by the Fair Credit Reporting Act," id. ¶ 20.

Due to the convoluted nature of plaintiff's pleadings, it is difficult to discern whether plaintiff intended to assert a claim for a willful violation of section 1681i of the FCRA. In an overabundance of caution, this court will treat count two as also asserting a violation of section 1681i of the Act.

A. Willful Violation of Section 1681m(a)

One of the central purposes of the FCRA is to protect an individual from inaccurate information in a consumer report used as a factor in determining the individual's eligibility for employment. See 15 U.S.C.A. § 1681(b) (1982). In attempting to achieve this goal, Congress imposed different obligations upon consumer reporting agencies that provide consumer credit information and users of consumer reports. Compare id. §§ 1681c-1681e with id. § 1681m.

Users have a limited responsibility. Under the Act, the user5 must advise the consumer of the name and address of the consumer reporting agency that provided the report when the consumer is adversely affected by the dissemination of information provided for employment purposes.6 The aim of this notice requirement is "to enable the subject of a consumer report to request disclosure from the reporting agency of the nature and scope of the information in his file." Fischl v. General Motors Acceptance Corp., 708 F.2d 143, 149 (5th Cir.1983). Failure to comply with the "user" provision results in the imposition of civil liability. See 15 U.S.C.A. §§ 1681n, 1681o (1982).

Although "willful" is not defined in the Act, neither malice nor evil motive are necessary to establish a finding of "willfulness." See Stevenson v. TRW, Inc., 987 F.2d 288, 294 (5th Cir.1993) (citing Fischl v. General Motors Acceptance Corp., 708 F.2d 143, 151 (5th Cir.1983)). For purposes of this section of the Act, willfulness can be demonstrated by a showing of "knowingly and intentionally committing an act in conscious disregard for the rights of others." See id. at 293 (citing Pinner v. Schmidt, 805 F.2d 1258, 1263 (5th Cir.1986), cert. denied, 483 U.S. 1022, 107 S.Ct. 3267, 97 L.Ed.2d 766 (1987)).

Defendants propound two defenses to plaintiff's claim of willful violation of the user provision. Defendants first contend that plaintiff fails to specifically allege that defendants did not disclose the name and address of the consumer reporting agency making the report to Mr. Wiggins. Notwithstanding, plaintiff's claim appears to be adequate on its face. Plaintiff states that "when District Cablevision fired plaintiff it made no disclosure to him in connection with plaintiff's rights" under the Act. Compl. ¶ 19 (emphasis added). This statement coupled with plaintiff's allegation that defendant failed "to comply with the provisions of the Act § 1681m(a)-(c)," Compl. ¶ 18, is sufficient to survive challenge.7

Second, defendants maintain that they advised Mr. Wiggins of the adverse criminal record information contained in the consumer report provided to them by Equifax Services, Inc. Defs.' Mot. Dismiss at 5. It is undisputed that Mr. Wiggins was made aware of the inaccurate information contained in the consumer report. However, the statute requires the user to disclose the name and address of the reporting agency when an employment opportunity is denied.8

An inference could be drawn that Mr. Wiggins' was given some but not all of the information required under the statute. Mr. Wiggins' termination did prompt him to visit the regional office of ESI one day after being fired, suggesting that defendants may have informed him of at least the name of the consumer reporting agency issuing the report.9 However, plaintiff may have only been told that an Equifax report turned up negative information regarding his criminal history. Mr. Wiggins may have then taken it upon himself to seek out this company and confront those responsible for disseminating such erroneous information. Therefore, facts exist which could provide a basis for relief, and defendants' motion to dismiss with respect to this claim must be denied.10

B. Willful Violation of Section 1681m(b)

The Act also requires users of information to disclose the nature of certain information obtained from persons other than consumer reporting agencies upon a consumer's written request. The user of the information must make the right to make such request clear to the consumer when any adverse action is communicated to the consumer. See 15 U.S.C.A. § 1681m(b) (1982). The statute states:

Whenever credit for personal, family, or houshold sic purposes involving a consumer is denied or the charge for such credit is increased either wholly or partly because of information

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