Toler v. PPH Mortgage et al
MEMORANDUM OPINION denying 144 Motion for Partial Summary Judgment; granting in part and denying in part 147 Motion for Summary Judgment; temporarily denying 149 Motion for Partial Summary Judgment; granting in part and denying in part 152 Motion for Summary Judgment; granting in part and denying in part 154 Motion for Summary Judgment as set forth. Signed by Honorable Robert T. Dawson on November 5, 2014. (lw)
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
HOT SPRINGS DIVISION
TERRY D. TOLER, DONNA R. TOLER,
MARKETPLACE DEVELOPMENT CORPORATION
and SUCCESS DYNAMICS, INC. d/b/a
ALL PRO CLASSICS
CASE NO. 12-6032
PHH MORTGAGE CORPORATION and
EXPERIAN INFORMATION SOLUTIONS, INC.
Before the Court are Plaintiffs’ Motion for Partial Summary
Judgment (docs. 144-46, 157-63, 192), Experian’s Response (docs.
173-74, 176), PHH’s Response (docs. 180-81), Plaintiffs’ Reply
(docs. 186-91), PHH Mortgage Corporation’s (“PHH”) Motion for
Plaintiffs”)(docs. 147-48), PHH’s Reply (doc. 184), PHH’s Motion
for Partial Summary Judgment Regarding Terry and Donna Toler
(“the Tolers”)(docs. 149-51), PHH’s Reply (doc. 185), Experian
Information Solutions, Inc.’s (“Experian”) Motion for Summary
Judgment as to Corporate Plaintiffs and Business Damages (docs.
152-53), Experian’s Reply (doc. 193), and Experian’s Motion for
Summary Judgment as to the Tolers and All Other Damages (docs.
Also before the Court is Plaintiffs’ combined
response to all of Defendants’ Motions (docs. 167-72, 175, 17779).
Plaintiffs’ Complaint was originally filed in the Circuit
Court of Garland County, Arkansas, on January 31, 2012 by the
Tolers against PHH, Experian and Federal National Mortgage
Association (“Fannie Mae”).1
Defendants removed the action to
this Court on March 1, 2012.
An Amended Complaint
(doc. 72) was filed on April 30, 2013, adding Plaintiffs’
businesses, Success Dynamics, Inc. d/b/a All Pro Classics, and
Marketplace Development Corporation as Plaintiffs and again
naming Fannie Mae as a defendant.2
The Tolers allege claims against Defendants for violations
of the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681, et
Defendants under Arkansas law for tortious interference with
The Tolers’ FCRA claims stem from alleged inaccurate credit
specifically, that the Tolers were delinquent on their mortgage
Standard of Review
A motion for summary judgment will be granted when “there
Fannie Mae was previously dismissed from this action.
Fannie Mae was again dismissed from this action on March 26, 2014. (Doc. 105)
is no genuine issue as to any material fact and . . . the moving
party is entitled to judgment as a matter of law.”
Fed. R. Civ.
A “material” fact is one “that might affect the
outcome of the suit under the governing law . . . .”
v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
issue of material fact exists when there is sufficient evidence
favoring the party opposing the motion for a jury to return a
determining whether a genuine issue of material fact exists, the
evidence is to be viewed in the light most favorable to the
Adickes v. S.H. Kress & Co., 398 U.S. 144, 157
establishing the nonexistence of a genuine issue, the burden
then shifts to the opposing party to produce evidence of the
existence of a genuine issue of fact for trial.
v. Catrett, 477 U.S. 317, 322-23 (1986).
The opposing party
“may not rest upon mere allegation or denials of his pleading,
but must set forth specific facts showing that there is a
genuine issue for trial,” and “must present affirmative evidence
in order to defeat a properly supported motion for summary
Anderson, 477 U.S. at 256-57 (citing Fed. R. Civ. P.
In order to withstand a motion for summary judgment,
plaintiffs must substantiate their allegations with “sufficient
probative evidence [that] would permit a finding in [their]
favor on more than mere speculation, conjecture, or fantasy.”
Gregory v. Rogers, 974 F.2d 1006, 1010 (8th Cir. 1992), cert.
denied, 507 U.S. 913 (1993).
A mere scintilla of evidence is
insufficient to avoid summary judgment.
Moody v. St. Charles
County, 23 F.3d 1410, 1412 (8th Cir. 1994).
Rule 56(c) mandates
the entry of summary judgment, after adequate time for discovery
and upon motion, against a party who fails to make a showing
sufficient to establish the existence of an element essential to
that party’s case, and on which that party will bear the burden
of proof at trial.
Celotex, 477 U.S. at 322.
In their Motion for Partial Summary Judgment, Separate
Defendants’ liability under the FCRA.
Having reviewed the
pleadings and the evidence on file; viewing the evidence in the
light most favorable to the non-moving party as required, the
Court finds genuine issues of disputed material facts remain in
connection with the Tolers’ FCRA claims including, but not
reasonable investigations of the Tolers’ disputes, and whether
Experian failed to follow reasonable procedures to ensure the
accuracy of the Tolers’ credit information it reported, and, if
so, what damages were proximately caused by Defendants’ failures
to do so.
Accordingly, the Tolers’ motion (doc. 144) should be
Additionally, Experian’s motion (doc. 154) as to the
Tolers’ FCRA claims is DENIED to the extent it seeks a judgment
as a matter of law on the issue of liability pursuant to the
PHH moves for summary judgment on the corporate Plaintiffs’
tortious interference claims contending they are preempted by
the FCRA and, alternatively, that the corporate Plaintiffs
failed to establish a prima facie case of tortious interference
The FCRA was enacted, in large part, to protect
consumers by ensuring “fair and accurate credit reporting.”
U.S.C. § 1681(a)(1).
The FCRA’s preemption provisions are as
No requirement or prohibition may be imposed under the
laws of any State with respect to any subject matter
regulated under 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 to [certain
inapplicable state statutes.]
15 U.S.C. § 1681t(b)(1)(F).
[N]o consumer may bring any action or proceeding in
the nature of defamation, invasion of privacy, or
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).
PHH contends the corporate Plaintiffs’ tort claims are
preempted and cites Ilodianya v. Capital One Bank USA NA, 853
F.Supp.2d 772 (E.D. Ark. 2012) and Cathcart v. American Exp.,
The Court finds these cases inapposite to the
instant case, as the state claims found to be preempted in those
cases were brought by the consumer whose relief was governed by
It has been Defendants’ position throughout this
litigation that the corporate Plaintiffs are not “consumers”
under the FCRA and, therefore, are prohibited from bringing FCRA
While a consumer’s tortious interference claim may well
be preempted under the FCRA absent a showing of malice or
willful intent to injure the consumer, it is unlikely that these
provisions were intended to completely preempt any cause of
action by a potential plaintiff.
Accordingly, the Court finds
that the preemption provisions of the FCRA do not apply to the
Thus, the corporate Plaintiffs’ tortious
interference claims are not preempted by the FCRA, and PHH’s
motion (doc. 147) is DENIED as to its preemption argument.
PHH’s motion (doc. 147) also seeks summary judgment for the
corporate Plaintiffs’ failure to establish a prima facie case of
The elements of tortious interference
with a business expectancy are: (1) the existence of a valid
contractual relationship or a business expectancy, (2) knowledge
of the relationship or expectancy on the part of the interfering
party, (3) intentional interference inducing or causing a breach
resultant damage to the party whose relationship or expectancy
has been disrupted.
Ballard Group, Inc. v. BP Lubricants USA,
Inc., 436 S.W.3d 445 (Ark. 2014).
In addition, the defendants’
conduct must be “improper,” and there must be some third party
The expectancy that is obstructed must be
precise, and it must be sufficiently concrete in order to
qualify as a business expectancy and survive summary dismissal.
See Skalla v. Canepari, 430 S.W. 3d 72 (Ark. 2013).
contracts and business expectancies with third parties due to
the Tolers’ inability to obtain personal credit to provide
expectancies are, at best, speculative.
Further, aside from
general statements by Mr. Toler about being unable to fund his
corporations, the corporate Plaintiffs have not
Defendants were aware of such expectancies, much less acted
improperly to interfere with them.
The Court finds that Defendants are entitled to summary
judgment on the corporate Plaintiffs’ tortious interference
claims, in part, as the corporate Plaintiffs have not shown that
their alleged business expectancies were sufficiently precise or
Accordingly, PHH’s motion (doc. 147) is GRANTED as to
the corporate Plaintiffs’ tortious interference claims, and
these claims are DISMISSED WITH PREJUDICE.
Experian moves for summary judgment on all claims for
damages sustained by the corporate Plaintiffs or in connection
with business transactions (doc. 152).
Experian’s motion is
DENIED AS MOOT to the extent it requests the Court to find the
corporate Plaintiffs lack standing to sue under the FCRA and
that the Tolers lack standing to assert claims on behalf of the
corporate Plaintiffs under the FCRA.
The Tolers conceded these
two issues, and the corporate Plaintiffs do not assert claims
pursuant to the FCRA.
PHH and Experian also move for partial summary judgment
against the Tolers’ FCRA claims to the extent they seek business
damages (docs. 149, 154).
The FCRA defines a consumer as an
“individual” and provides for actual damages sustained by the
See 15 U.S.C. § 1681, et seq.
The FCRA does not
protect business entities or extend coverage to a consumer’s
Wisdom v. Wells Fargo Bank NA, 2012 WL
Experian’s motions (docs. 149, 154) are GRANTED to the extent
that the Tolers are prohibited from seeking business damages as
a matter of law.
This Court previously advised the parties in this case that
arguments regarding the appropriate measure of damages would be
considered at the trial of this matter (doc. 105), and there are
now numerous motions in limine and motions to exclude evidence
The Court will consider these motions prior to trial.
PHH’s motion (doc. 149) is DENIED to the extent it seeks
the dismissal of Mr. Toler’s FCRA claim.
Experian admitted that
Mr. Toler’s dispute was incorrectly classified as a repeat
dispute on a joint account, and there is no question that PHH
and Experian were aware that both Mr. and Mrs. Toler were
disputing the reported information, in particularly, Mr. Toler.
For the forgoing reasons, the Tolers’ motion (doc. 144) is
Experian’s motion (doc. 152) is DENIED as to any FCRA
standing issues, and GRANTED as to any business damages sought
by the Tolers.
Any speculative or impermissible damages sought
by the Tolers remain the subject of pending motions in limine
and will be considered prior to trial.
Experian’s motion (doc.
154) as to the Tolers’ FCRA claims is DENIED to the extent it
seeks summary judgment on the issue of liability and DENIED
availability of punitive damages closer to trial.
(doc. 147) is GRANTED IN PART and DENIED IN PART, and the
corporate Plaintiffs’ tortious interference claims are DISMISSED
PHH’s motion (doc. 149) is DENIED as to Mr.
Toler’s claim pursuant to the FCRA, and GRANTED as to any
damages sought by the Tolers will be resolved prior to trial.
A jury trial remains scheduled for November 17, 2014.
IT IS SO ORDERED this 5th day of November 2014.
/s/ Robert T. Dawson
Honorable Robert T. Dawson
United States District Judge
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