Opinion
Civ. 1:20-cv-02146-CL
05-14-2021
KASANDRA DUREN, Plaintiff, v. TRANSUNION, LLC; EQUIFAX INFORMATION SERVICES, LLC; FEDLOAN SERVICING, Defendants.
REPORT AND RECOMMENDATION
CLARKE, Magistrate Judge.
Plaintiff brings this cause of action against defendants for allegedly misreporting information on her credit reports in violation of the Fair Credit Reporting Act. This case comes before the Court on defendant FedLoan Servicing's Motion for Judgment on the Pleadings (#20). For the reasons discussed below, the Court recommends that the motion be GRANTED.
BACKGROUND
Plaintiff Kasandra Duren ("Plaintiff) filed this case on or about December 9, 2020, alleging a violation of 15 U.S.C. §1681 et.seq., more commonly referred to as the Fair Credit Reporting Act ("FCRA") against FedLoan Servicing ("FedLoan"), Trans Union, LLC, and Equifax. Plaintiff fell behind in making payments on her loan with FedLoan, leading to a delinquency that grew to be more that 120 days. The loan in question did not get paid by Plaintiff or anyone on her behalf The loan defaulted and transferred to the guarantor. Once transferred, the responsibility for the collection of the loan was upon a different party than FedLoan. FedLoan then reduced the amount that Plaintiff was to pay to FedLoan to zero. FedLoan has included the report for Plaintiffs loan as an exhibit to its Answer (#15-1).
Plaintiff alleges that FedLoan failed to accurately report on Plaintiffs accounts. Compl. ¶ 2. Plaintiff claims that because the account was closed and shows a zero balance, that it is inaccurate and misleading for FedLoan to report the account as "past due." Plaintiff alleges that her FICO Score has been harmed and her ability to repair the score has been hampered by FedLoan's knowing and willful actions. Compl. ¶ 13. In the alternative, Plaintiff alleges that FedLoan's actions were negligent and led to inaccurate, misleading, and incomplete credit reporting. Compl. ¶ 14. Plaintiff believes that FedLoan used improper standards for credit reporting, and that her account will incorrectly appear to third parties as though she is behind on her payments.
STANDARD OF REVIEW
FedLoan moves the Court for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c), which states in relevant part "After the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings." Fed.R.Civ.P. 12(c). See also Schroll v. Plunkett, 760 F.Supp. 1385, 1387 (D. Or. 1990), affd, 932 F.2d 973 (9th Cir 1991). A motion for judgment on the pleadings under FRCP 12(c) is procedurally proper at any time after the defendant has filed an Answer. See Alexander v. Williams, 2:13-CV-01176-PK, 2014 WL 128116, at *1 (D. Or. Jan 13, 2014) ("After the defendant has answered the complaint, a party may move for judgment on the pleadings.").
"Judgment on the pleadings is proper when the moving party clearly establishes on the face of the pleadings that no material issue of fact remains to be resolved and that it is entitled to judgment as a matter of law." Hal Roach Studios, Inc. v. Richard Feiner and Co., Inc., 896 F.2d 1542, 1550 (9th Cir. 1990). When analyzing a motion for judgment on the pleadings, the allegations made by the non-moving party are to be taken as true. Id. If matters outside the pleadings are presented to and considered by the court, the motion is treated as a summary judgment motion. FRCP 12(d). However, the court may consider a document extrinsic to the complaint if the parties do not dispute its authenticity and the complaint necessarily relies'on it. Dent v. Cox Communs. Las Vegas, Inc., 502 F.3d 1141, 1143 (9th Cir 2007); Or. Natural Desert Ass 'n v. United States Forest Serv., 312 F.Supp.2d 1337, 1343 n.3 (D Or 2004).
DISCUSSION
Defendant FedLoan moves for judgment on the pleadings under FRCP 12(c) on the grounds that its credit reporting for Plaintiffs loan was accurate and not misleading. Congress enacted the FCRA, 15 U.S.C. §§ 1681, "to ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy." Safeco Ins. Co. of Ant. v. Burr, 551 U.S. 47, 52 (2007). The Ninth Circuit Court of Appeals has held that a credit entry can be "incomplete or inaccurate" within the meaning of the FCRA "because it is patently incorrect, or because it is misleading in such a way and to such an extent that it can be expected to adversely affect credit decisions," Gorman v. Wolpoff& Abramson, LLP, 584 F.3d 1147, 1163 (9th Cir. 2009) citing Sepulvado v. CSC Credit Servs., Inc., 158 F.3d 890, 895 (5th Cir. 1998), After reviewing the evolving caselaw similar to this case, the Court finds Bibbs v. Trans Union, LLC, CV 20-4514, 2021 LEXIS 32893 (ED Pa. Feb. 23, 2021) instructive and analogous to the facts in this case. In Bibbs, plaintiff fell more than 120 days behind on her student loan payments with Navient, and the loans were transferred to another lender without being paid off by plaintiff or anyone else. Id. at *2. Plaintiff sued defendant for inaccurately reporting her pay status as 120 days past due even though her loan was closed and transferred resulting in a zero-dollar balance owed to Navient upon transfer. Id. at *6. The court reviewed the reporting "through the lens of a person in a position to make an adverse decision based on a credit report, i.e., a creditor," (Id. at *8) and found the report information accurate and held that it would not mislead a reasonable creditor. Id. at *11. The court reasoned that "while 'the issue whether 'technically correct' information was misleading in such a way that it could have been expected to have an adverse effect is generally a question for the jury,' several courts facing nearly identical facts have found credit reports reporting a historical past due pay status to be accurate and not misleading as a matter of law." Id.
The court in Bibbs relied on the factually analogous opinions in Settles, Hernandez, and Gross to reach its conclusion that the account information given to the creditor must be viewed in its entirety to determine whether the reporting is accurate. See Id. at *19 citing Settles v. Trans Union, LLC, No. 20-84, 2020 U.S. Dist. LEXIS 220341 (M.D. Tenn. Nov. 24, 2020) (finding the reported information neither inaccurate nor materially misleading because it was "implausible that a creditor would be misled into believing [the consumer] is currently 120 days past due on his payment obligation each month when the reporting of the account state[d] that the account was closed, ., and ha[d] a zero-dollar balance"); Hernandez v. Trans Union, LLC, No. 19-1987, 2020 U.S. Dist LEXIS 249358 (S.D. Fla. Dec. 10, 2020) (granting Trans Union's motion for judgment on the pleadings after "the [credit] report [was] reviewed and considered in its entirety"); Gross v. Private National Mortgage Acceptance Co., LLC, 2021 U.S. Dist. LEXIS 5149 (E.D. NY Jan. 9, 2021) (finding that when a creditor read beyond the "pay status" entry in isolation and read the rest of the entries, the "only logical inference is that the account was previously 30 days past due").
Plaintiff concedes that this Court can decide whether the credit report at issue is "patently inaccurate" by looking at the report on its face. Plf s Response Br. at 8 (#25). This Court has reviewed the credit report provided by defendant FedLoan (#15-1), and finds that on its face it lists Plaintiffs account as having (1) a "payment rating" of code 6 - 180 or more days past the due date; (2) a "current balance" of $0.00; (3) an "actual payment amount" of $0.00; (4) "amount past due" is $0.00; (5) "date of last payment" was 1/23/2015; (6) "status" is code 05 - account transferred; and (7) a "special comment" stating "AT-Account closed due to transfer."
Plaintiff does not dispute that her loan payments were more than 120 days past due when her account was closed and the loan was transferred to another lender for collection. Instead, plaintiff argues "it is patently inaccurate to report the loan as '120 days or more than four payments past due,' because there is nothing owed to Defendant." Plf s Response Br. at 7. This' argument fails as a matter of law because it requires this Court to limit review to the entry that reads "Payment Rating: 6-180 or more days past the due date" and ignore all other tradelines in the report. As the judges in Bibbs, Hernandez, Settles and Gross explained, we must view the account information given to the creditor in its entirety, and in doing so, the reported information is accurate as a matter of law.
RECOMMENDATION
For the reasons provided above, FedLoan's Motion for Judgment on the Pleadings (#20) should be GRANTED. Judgment should be entered in favor of FedLoan and the case should be dismissed, This Report and Recommendation will be referred to a district judge. Objections, if any, are due no later than fourteen (14) days after the date this recommendation is filed. If objections are filed, any response is due within fourteen (14) days after the date the objections are filed. See, Fed. R. Civ. P. 72, 6. Parties are advised that the failure to file objections within the specified time may waive the right to appeal the District Court's order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).