Champion v. Global Credit Card Service LLC et al

Filing 17

MEMORANDUM OPINION. Signed by Judge Inge P Johnson on 8/15/12. (ASL)

FILED
2012 Aug-15 PM 04:34
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
VICKIE M. CHAMPION,
Plaintiff,

)
)
)
vs.
)
)
GLOBAL CREDIT CARD
)
SERVICES, LLC, NCO FINANCIAL )
SYSTEMS, INC., and CAPITAL
)
ONE, N.A.,
)
Defendants.
)

CASE NO. 2:12-CV-01966-S

MEMORANDUM OPINION
Pending before the court are a motion for partial dismissal (doc. 11) by
defendant Capital One, N.A., a memorandum in support thereof (doc. 12), plaintiff
Vickie Champion’s opposition thereto (doc. 15), and defendant’s reply (doc. 16).
Having considered the motion and all other pleadings filed to date, the court finds as
follows:
Factual Background
Defendants Global Credit Card Services, LLC (“Global”), NCO Financial
Systems, Inc. (“NCO”), and Capital One, N.A. (“CONA”) are engaged in the debt
collection business (Compl. ¶ 9). Defendants are attempting to collect a debt which
they allege plaintiff owes but which plaintiff avers has been previously paid in full
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and/or is stale (Compl. ¶ 10). Plaintiff has been contacted numerous times in writing
and via telephone by both defendants and their attorneys (Compl. ¶¶ 11–25). Plaintiff
has “continuously disputed” that she owed the debt, which she avers has been paid
(Compl. ¶¶ 10, 21, 23). Nonetheless, plaintiff alleges that she has received numerous
collection calls from defendant NCO made both by automatic recordings and live
representatives, and that these representatives “often made disparaging remarks and
were harassing and abusive” (Compl. ¶ 21). She also avers that “at all times relevant
[to this litigation] [d]efendants have called [p]laintiff hundreds of times at all times
of the day and night,” that she has “continuously explained” that she is no longer
responsible for the debt, that she has repeatedly requested that defendants no longer
contact her, and that the harassing phone calls have continued (Compl. ¶ 25). Plaintiff
alleges violation of the Fair Debt Collections Practices Act, 15 U.S.C. § 1692 et seq.
(Count I, Compl. ¶¶ 31–45), invasion of her right to privacy (Count II, Compl. ¶¶
46–51), false light (Count III, Compl. ¶¶ 52–57), defamation (Count IV, Compl. ¶¶
58–65), and wantonness (Count V, Compl. ¶¶ 66–71). Defendant CONA moves for
dismissal of Counts I–III and V.
Standard of Review
When an issue is before the court on a motion to dismiss, the court must accept
the allegations of the complaint as true and construe them “‘in the light most
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favorable to the plaintiff.’” Simmons v. Sonyika, 394 F.3d 1335, 1338 (11th Cir. 2004)
(citing Hill v. White, 321 F.3d 1334, 1335 (11th Cir. 2003)). See also Erickson v.
Pardus, 551 U.S. 89, 94 (2007) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544,
555–56 (2007) (in turn citing Swierkiewicz v. Sorema N.A., 534 U.S. 506, 508 n. 1
(2002); Neitzke v. Williams, 490 U.S. 319, 327 (1989); Scheuer v. Rhodes, 416 U.S.
232, 236 (1974))). “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.’” Ashcroft v. Iqbal, 556 U.S. 662, 667(2009) (quoting Twombly, 550 U.S.
at 570). See also Sinaltrainal v. Coca-Cola Co., 578 F.3d 1252, 1260 (11th Cir. 2009)
(stating that “[a] complaint may be dismissed if the facts as pled do not state a claim
for relief that is plausible on its face”). “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. “The
plausibility standard is not akin to a ‘probability requirement,’ but it asks for more
than a sheer possibility that a defendant has acted unlawfully.” Id. (quoting Twombly,
550 U.S. at 556). “To survive dismissal, ‘the complaint’s allegations must plausibly
suggest that the plaintiff has a right to relief, raising that possibility above a
“speculative level”; if they do not, the plaintiff’s complaint should be dismissed.’”
James River Ins. Co. v. Ground Down Engineering, Inc., 540 F.3d 1270, 1274 (11th
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Cir. 2008) (citing Twombly, 550 U.S. at 555).
Legal Analysis
Fair Debt Collections Practices Act Claim (Count I)
Defendant contends that plaintiff’s Fair Debt Collection Practices Act
(“FDCPA”) claim against it should be dismissed because defendant is not subject to
the FDCPA. See Def. Mem. (doc. 12) at 2–5. The FDCPA, 15 U.S.C. § 1692 et seq.
(2010), applies only to “debt collectors”; see 15 U.S.C. § 1692(e) (“It is the purpose
of this subchapter to eliminate abusive debt collection practices by debt collectors
. . . .”). The statute defines “debt collector” as
any person who uses any instrumentality of interstate
commerce or the mails in any business the principal
purpose of which is the collection of any debts, or who
regularly collects or attempts to collect, directly or
indirectly, debts owed or due or asserted to be owed or due
another. . . . The term does not include—(A) any officer or
employee of a creditor while, in the name of the creditor,
collecting debts for such creditor . . . .
15 U.S.C. § 1692a(6). The statute defines “creditor” as “any person who offers or
extends credit creating a debt or to whom a debt is owed,” excluding “any person to
the extent that he receives an assignment or transfer of a debt in default solely for the
purpose of facilitating collection of such debt for another.” 15 U.S.C. § 1692a(4).
One element that a plaintiff must establish to prevail on an FDCPA claim is

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that the defendant is a “debt collector” as defined by the statute. Here, defendant
avers that it is the originator of the debt at issue, such that defendant is a “creditor”
as the term is defined in the FDCPA. The plaintiff concurs. Therefore, by joint
stipulation of the parties, defendant’s motion to dismiss is due to be GRANTED with
respect to Count I of plaintiff’s complaint. The court will so rule by separate order.
Invasion of Privacy Claim (Count II)
In Phillips v. Smalley Maintenance Services, Inc., 435 So. 2d 705, 708–09
(Ala. 1983), the Alabama Supreme Court adopted the definition of the “wrongful
intrusion” branch of the tort of invasion of privacy set forth in the Restatement
(Second) of Torts, which states that “one who intentionally intrudes physically or
otherwise, upon the solitude or seclusion of another or his private affairs or concerns,
is subject to liability to the other for invasion of his privacy, if the intrusion would be
highly offensive to a reasonable person.” See Johnson v. Stewart, 854 So. 2d 544,
547–48 (Ala. 2002) (quoting Phillips, 435 So. 2d at 708–09 (in turn quoting
Restatement (Second) of Torts, § 652B (1977))). Plaintiff argues that the following
allegations state a wrongful intrusion claim against defendant upon which relief can
be granted: (1) she received seven collection letters; (2) she “received hundreds of
calls at all times of the day and night” despite her request not to be contacted; and (3)
“live representatives making the calls would often make disparaging remarks and
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were harassing and abusive.” Pl. Resp. (doc. 15) at 5–6.
While plaintiff’s response places at issue seven collection letters, her
Complaint alleges that she only received two letters from defendant CONA (see
Doc.1, ¶¶ 19–20). The first letter was sent in response to a letter from plaintiff herself,
and could not be argued reasonably to support a wrongful intrusion claim. See Compl.
(doc. 1) at ¶ 19 (“On or about June 21, 2011, Plaintiff received a letter from [CONA]
indicating that they investigated her dispute and found the account balance as correct.
The letter indicated the Plaintiff had an outstanding balance of $2,093.66 and Plaintiff
was responsible for this amount. Plaintiff avers that no other documentation was
provided with this letter.”). With respect to the second letter, plaintiff simply alleges
that defendant CONA informed her that her account was being serviced by codefendant NCO, proposing possible payment options. See Compl. (doc. 1) at ¶ 20.
There is no allegation that either letter contained any unreasonable or harassing
language so as to give rise to a claim for wrongful intrusion. All other letters
allegedly received by plaintiff were purportedly sent by other parties, not CONA. See
Compl. (doc. 1) at ¶¶ 11, 13, 14, 15, 18, 22.
Plaintiff also alleges that “Defendants have called Plaintiff hundreds of times
at all times of the day and night” despite her request not to be contacted. Compl. (doc.
1) at ¶ 25. According to plaintiff, this allegation supports a wrongful intrusion claim
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against CONA. However, plaintiff’s complaint fails to allege that CONA made any
harassing phone calls––or, in fact, any calls whatsoever––while she does specifically
allege that the other defendants made harassing phone calls. See Compl. (doc. 1) at
¶ 12, 17 (allegations of calls received from representatives of Global); Compl. ¶ 21
(“Plaintiff avers that throughout these times [relevant to the litigation] Plaintiff was
receiving collection calls from NCO.”). Moreover, even if plaintiff’s blanket assertion
that she received “hundreds” of phone calls were sufficient to implicate conduct by
defendant CONA, such claim would, in the words of CONA, “support an allegation
that CONA made one phone call to [plaintiff] on one day at 3 p.m., that she did not
answer, and the other Defendants made the remaining ‘hundreds of calls at all times
of the day and night.’” Def. Reply (doc. 16) at 4. Plaintiff’s allegations that she
received harassing phone calls from CONA are thus speculative at best.
Taken together as true and in the light most favorable to the plaintiff, plaintiff’s
allegations do not support a claim against defendant CONA for wrongful intrusion
because they either do not rise to the level of “unreasonable conduct” required under
Alabama law or are conclusory and therefore insufficient to survive dismissal under
Twombly and Iqbal. As such, they do not state an invasion of privacy claim against
CONA. Defendant’s motion is therefore due to be GRANTED with respect to Count
II of plaintiff’s complaint. The court will so rule by separate order.
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False Light Claim (Count III)
The Alabama Supreme Court has explained the elements of a cause of action
for “false light” invasion of privacy as follows:
One who gives publicity to a matter concerning another
that places the other before the public in a false light is
subject to liability to the other for invasion of his privacy,
if (a) the false light in which the other was placed would be
highly offensive to a reasonable person, and (b) the actor
had knowledge of or acted in reckless disregard as to the
falsity of the publicized matter and the false light in which
the other would be placed.
Butler v. Town of Argo, 871 So. 2d 1, 12 (Ala. 2003) (quoting Restatement (Second)
of Torts § 652E (1977)) (other internal quotations omitted). Importantly, “[i]n the
context of a false-light claim, ‘giving publicity’ is ‘making a “matter . . . public, by
communicating it to the public at large, or to so many persons that the matter must be
regarded as substantially certain to become one of public knowledge.”’” Regions
Bank v. Plott, 897 So. 2d 239, 245 (Ala. 2004) (quoting Ex parte Birmingham News,
Inc., 778 So. 2d 814, 818 (Ala. 2000) (in turn quoting Restatement (Second) of Torts
§ 652D, cmt. a. (1977))) (emphasis in original).
Before addressing the merits of plaintiff’s false light claim, the court must
address the contention, raised initially in a footnote in defendant’s Memorandum in
support of its motion (see doc. 12 at 10 n.3), that plaintiff’s false light claim is

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preempted by the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681 et seq.
(2003).1 Defendant directs the court’s attention to another case arising in the Northern
District of Alabama, Schlueter v. BellSouth Telecommunications, 770 F. Supp. 2d
1204 (N.D. Ala. 2010), and encourages the court to adhere to the reasoning in that
case of Chief Judge Blackburn, who dismissed the plaintiff’s state tort law claims
based on the defendant’s alleged reporting of inaccurate information to credit
reporting agencies because they were preempted by 15 U.S.C. § 1681t(b)(1)(F). See
Schlueter, 770 F. Supp. 2d at 1206–11. Defendant also notes without comment
another Northern District case, McCloud v. Homeside Lending, 309 F. Supp. 2d 1335
(N.D. Ala. 2004), in which Judge Smith held that state tort claims were not preempted
by § 1681t(b)(1)(F) or by § 1681h(e). See McCloud, 309 F. Supp. 2d at 1340–44. The
court is persuaded by the reasoning of Judge Smith, as explained below.
The relevant portions of the FCRA are § 1681s-2, § 1681t(b)(1)(F), and §
1681h(e). Section 1681t(b)(1)(F) provides:
No requirement or prohibition may be imposed under the
laws of any State–
(1) with respect to any subject matter regulated under–
1

Plaintiff did not address defendant’s preemption argument in her response, and
defendant expanded thereupon in its Reply (see doc. 15 at 8). Defendant alleges that plaintiff’s
failure to refute that her claim is preempted by the FCRA “further confirms that her false light
claim should be dismissed.” Def. Reply (doc. 16) at 8. While plaintiff does herself a disservice by
neglecting to address an issue raised by defendant, such omission is not of itself evidence that
defendant’s allegations are meritorious.
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...
(F) section 1681s-2 of this title, relating to the
responsibilities of persons who furnish information
to consumer reporting agencies, except that this
paragraph shall not apply–
(i) with respect to section 54A(a) of chapter
93 of the Massachusetts Annotated Laws (as
in effect on September 30, 1996); or
(ii) with respect to section 1785.25(a) of the
California Civil Code (as in effect on
September 30, 1996) . . . .
Section 1681s-2 is a lengthy provision which addresses the “[d]uties of furnishers of
[credit] information upon notice of dispute.” Section 1681h(e) provides:
Except as provided in sections 1681n and 1681o of this
title, no consumer may bring any action or proceeding in
the nature of defamation, invasion of privacy, or
negligence with respect to the reporting of information
against any consumer reporting agency, any user of
information, or any person who furnishes information to a
consumer reporting agency, based on information disclosed
pursuant to section 1681g, 1681h, or 1681m of this title, or
based on information disclosed by a user of a consumer
report to or for a consumer against whom the user has
taken adverse action, based in whole or in part on the
report except as to false information furnished with malice
or willful intent to injure such consumer.
Id. Judge Smith outlined the three varying approaches that district courts have taken
in construing these three statutes (see generally McCloud at 1340–42) before settling
on a group of decisions that are “based upon construction of the subject statutory
provisions.” Id. at 1341. Judge Smith described this approach as follows:
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The courts adopting this approach first look to the
language of § 1681h(e), which specifically references “any
action or proceeding in the nature of defamation, invasion
of privacy, or negligence.” 15 U.S.C. § 1681h(e). As the
specified causes of action comprise a non-exclusive list of
torts that might arise from false or inaccurate credit reports,
§ 1681h(e) is deemed by these courts as applying to any
state-law causes of action that may be classified as “torts.”
Contrastingly, § 1681t(b)(1)(F) appears to deal only with
state statutory regulation of credit reporting. This is
evidenced by the fact that the two state statutory schemes
specifically excluded from the ambit of § 1681t(b)(1)(F)––
i.e., section 54A(a) of Chapter 98 of the Massachusetts
Annotated Laws, and section 1785.25(a) of the California
Civil Code––address inaccurate or incomplete information
in a credit report. Thus, under the third approach, §
1681h(e) applies only to torts, while § 1681t(b)(1)(F)
applies only to state statutory regulation of credit reporting
practices and procedures. See Carlson [v. Trans Union,
LLC], 259 F. Supp. 2d [517,] 521 [(N.D. Tex. 2003)].
Yet, another rationalization for the conclusion that
§ 1681t(b)(1)(F) cannot preempt all state law claims,
including state common law tort claims, is that this section
is a general preemption provision. In contrast, § 1681h(e)
contains a more specific preemption clause (i.e. “any action
or proceeding in the nature of defamation, invasion of
privacy, or negligence”). When a specific statute carves out
an exception to a general statute, the “specific statute will
not be controlled or nullified by [the] general one,
regardless of the priority of enactment.” Morton v.
Mancari, 417 U.S. 535, 550–51, 94 S.Ct. 2474, 2483, 41
L.Ed.2d 290 (1974). Under [this] approach, § 1681h(e)
would govern the question of preemption for the claims
asserted in the present case. See Jeffery v. Trans Union,
LLC, 273 F. Supp. 2d 725 (E.D. Va.2003); Gordon v.
Greenpoint Credit, 266 F. Supp. 2d 1007 (S.D. Iowa
2003).
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McCloud, 309 F. Supp. 2d at 1341.
The court is of accord with Judge Smith that § 1681h(e) governs the question
of preemption for the false light claim asserted in the present case. Applying the
statute here, the relevant portion reads as follows: “no consumer may bring any action
or proceeding in the nature of . . . invasion of privacy . . . with respect to the reporting
of information against any . . . person who furnishes information to a consumer
reporting agency . . . except as to false information furnished with malice or willful
intent to injure such consumer.” 15 U.S.C. § 1681h(e) (2003). Therefore, if plaintiff
alleged that defendant acted “with malice or willful intent to injure,” then plaintiff’s
claim will survive dismissal by way of preemption. As noted supra, under Alabama
law, a false light claim may only be maintained if, inter alia, “the actor had
knowledge of or acted in reckless disregard as to the falsity of the publicized matter
and the false light which the other would be placed.” Butler, 871 So. 2d at 12. Taking
plaintiff’s allegations as true, plaintiff specifically alleges that defendant’s “actions
were willful, reckless, wanton, and/or made with malice and resulted in the Plaintiff
being unreasonably placed in a false light.” Compl. (doc. 1) at ¶ 57 (emphasis
supplied). Plaintiff’s allegations with respect to a claim of false light under the
common law of Alabama are therefore pleaded with sufficient specificity to survive
dismissal due to preemption by the FRCA.
12

Turning to the substance of plaintiff’s false light claim, defendant observes that
under Alabama law, “[i]n the context of a false-light claim, ‘giving publicity’ is
‘making a “matter . . . public, by communicating it to the public at large, or to so
many persons that the matter must be regarded as substantially certain to become one
of public knowledge.”’” Regions Bank v. Plott, 897 So. 2d 239, 245 (Ala. 2004)
(quoting Ex parte Birmingham News, Inc., 778 So.2d 814, 818 (Ala. 2000) (in turn
quoting Restatement (Second) of Torts § 652D, cmt. a. (1977))). Defendant then
avers that plaintiff “has only alleged that purportedly inaccurate information was
communicated to the ‘national credit reporting media and/or other third parties
including collectors,’ not the public at large,” such that the “publicity” element of
false light has not been satisfied. See Def. Mem. (doc 12) at 9 (quoting Compl. (doc.
1) at ¶ 53).
This logic is unpersuasive. As plaintiff explains in her response,
[Defendant’s] reporting of inaccurate information to the
national credit bureaus satisfies the “publicity” requirement
because of the numerous ways an individual’s credit report
is used today. Credit reports are used by a wide variety of
individuals and/or entities who attempt to gather
information about certain individuals. Inaccurate
information contained within an individual’s credit report
can have devastating results and would be highly offensive
to a reasonable person. Thus, . . . [defendant’s] publishing
of inaccurate information to the national credit bureaus
satisfies the publicity element of a false light claim because
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of the near limitless individuals and/or entities which can
and do access such information.
Pl. Resp. (doc. 15) at 7. Taking plaintiff’s allegations as true and viewing them in the
light most favorable to the plaintiff, for the reasons discussed supra, defendant has
failed to demonstrate either that plaintiff’s false light claim is preempted by the
FCRA or that plaintiff has failed sufficiently to plead the “publicity”element of false
light. Accordingly, defendant’s motion to dismiss plaintiff’s false light claim (Count
III of plaintiff’s Complaint) is due to be DENIED. The court will so rule by separate
order.
Wantonness Claim (Count V)
Alabama law requires a plaintiff seeking recovery on a theory of negligence to
establish (1) the existence of a duty owed to the plaintiff by the defendant, (2) a
breach by the defendant of that duty, (3) the breach of that duty proximately caused
the plaintiff’s injury, and (4) damages or injury sustained by the plaintiff. See Crowne
Investments, Inc. v. Bryant, 638 So. 2d 873, 878 (Ala. 1994) (citing Albert v. Hsu, 602
So. 2d 895, 897 (Ala. 1992)); compare 65 C.J.S. Negligence § 100 (“While
recklessness is similar to negligence in that it requires a showing of a duty,
recklessness is sometimes held to be different from, and to be more than, negligence,
or even gross negligence . . . .”) (internal footnotes omitted). “Wanton” conduct is

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defined as existing where a defendant “consciously acts or fails to act with a reckless
or conscious disregard of the rights or safety of others, and [the defendant] is aware
that harm will likely or probably result.” APJI Civil 29.00 (2011 ed.). Plaintiff alleges
that the defendants were negligent, reckless and/or wanton in their: (1) alleged failure
to properly investigate her dispute that she was not responsible for the debt and that
the debt had been paid in full; (2) alleged failure to adopt policies and procedures to
govern (i) investigating consumer claims that accounts had been previously paid off,
(ii) ensuring false information is not disseminated, and (iii) preventing harassing
collections communications; and (3) alleged failure to train their employees with
respect to (i) investigating consumer claims that accounts had been previously paid
off, (ii) ensuring false information is not disseminated, and (iii) preventing harassing
collections communications. See Compl. (doc. 1) at ¶¶ 67–69.
In its memorandum, defendant cites a case from the Southern District of
Alabama, Rigby v. FIA Card Services, N.A., 2011 WL 6669052 (S.D. Ala. 2011), and
contends that plaintiff, in a similar fashion to the plaintiff in Rigby, has failed to
identify any duty owed by defendant. In that case, the plaintiff alleged that the
defendant “failed in its duty to reasonably investigate his dispute” regarding a charge
made to his credit card. Id. at *6 (internal quotations omitted). The court noted,
however, that the plaintiff failed to identify “any specific law, statutory or otherwise,
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where a creditor owes a duty to investigate billing errors outside of the [Fair Credit
Billing Act],” and held that “[b]ecause the plaintiff could not meet the requirements
to state a claim under the Fair Credit Billing Act and failed to identify any other
source of law that imposed a duty on the defendant to investigate his disputed credit
card charge,” the negligence and wantonness claims were dismissed. Id. Defendant
alleges that plaintiff, like the plaintiff in Rigby, has failed to identify “any specific
law, statutory or otherwise, where a creditor owes [the] duty” forming the basis of her
claims” and “[i]nstead, she merely asserts conclusively that Defendants’ conduct was
negligent, reckless and/or wanton.” See Def. Mem. (doc. 12) at 12.
The court disagrees. Among the duties owed by a creditor to individuals to
whom it issues credit are, e.g., a duty to maintain accurate records and a duty not to
report false information about those individuals to third parties. Taking plaintiff’s
allegations as true and viewing them in the light most favorable to plaintiff, such
allegations are sufficient to sustain a claim of, at minimum, negligent conduct by
defendant, though they do not at present exclude the possibility of reckless or wanton
conduct either. Accordingly, defendant’s motion to dismiss is due to be DENIED
WITHOUT PREJUDICE with respect to Count V of plaintiff’s claim, with leave
to revisit this issue by subsequent motion at the close of discovery.

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Conclusion
Having considered the foregoing, and being of the opinion that the motion to
dismiss (doc. 11) of defendant Capital One, N.A., is due to be GRANTED IN PART
and DENIED IN PART, the court shall so rule by separate Order.
DONE and ORDERED this 15th day of August 2012.

INGE PRYTZ JOHNSON
U.S. DISTRICT JUDGE

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