Green v. Experian Information Solutions, Inc. et al

Filing 45

ORDER GRANTING DEFENDANTS' MOTION TO DISMISS by Judge William Alsup g[ranting 40 Motion to Dismiss]. Admissions due by NOON on 4/11/2017. (whasec, COURT STAFF) (Filed on 3/28/2017)

Download PDF
1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE NORTHERN DISTRICT OF CALIFORNIA 8 9 11 For the Northern District of California United States District Court 10 In Re: 12 EXPERIAN INFORMATION SOLUTIONS CREDIT REPORTING LITIGATION. 13 14 / 15 16 17 No. C 16-05674 WHA No. C 16-05676 WHA No. C 16-05679 WHA No. C 16-05694 WHA No. C 16-05701 WHA No. C 16-05704 WHA No. C 16-06315 WHA No. C 16-06335 WHA No. C 16-06363 WHA No. C 16-06372 WHA ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS (IN ALL OF THE ABOVE-LISTED CASES) 18 This order holds that under the Fair Credit Reporting Act, 15 U.S.C. 1681 et seq., a 19 report of a debt may be stated at the full unpaid balance even if the debt is subject to a confirmed 20 Chapter 13 plan wherein the debt will be discharged if and when a specified lesser amount is 21 paid. Under the Bankruptcy Act, the full debt remains undischarged until, if ever, the specified 22 amount is actually paid. So it remains correct to inform the world at large via the credit report 23 of the full unpaid balance. Since the risk persists that the debtor will fail to pay under the 24 Chapter 13 plan, it would be misleading to future creditors to report, as plaintiffs’ counsel 25 insists in all of these cases, the lesser amount. That would be getting the cart before the horse. 26 First, the debtor must perform as specified under the plan, then get a discharge. At that point, 27 the debt will go to zero. 28 1 Although our court of appeals has not yet ruled on the issue, every single district judge 2 who has ruled has held as above. This order adopts this reasoning, including at least two cases 3 rejecting plaintiffs’ main decision In re Luedtke, No. 2-3582-SVK, 2008 WL 295253 4 (Bankr. E.D. Wis. July 31, 2008). See, e.g., Newkirk v. Experian Info. Sols., Inc. et al., 5 No. 4:16-CV-05691-SBA, 2017 WL 1078653 (N.D. Cal. Mar. 13, 2017) (Judge Saundra 6 Armstrong); Mamisay v. Experian Info. Sols., Inc., No. 16-CV-5684-YGR, 2017 WL 106517 7 (N.D. Cal. Mar. 21, 217) (Judge Yvonne Rogers) (rejecting In re Luedtke); Smith v. Experian 8 Info. Sols., Inc., No. 16-CV-4653-BLF, 2017 WL 1092377 (N.D. Cal. Mar. 23, 2017) 9 (Judge Beth Freeman) (rejecting In re Luedtke); Polvorosa v. Allied Collection Serv., Inc., 11 For the Northern District of California United States District Court 10 No. 2:16-CV-1508 JCM (CWH), 2017 WL 29331 (D. Nev. Jan. 3, 2017). At oral argument, plaintiffs’ counsel offered a fall-back position, namely that they would 12 accept reporting the full unpaid debt so long as the line item also noted that it remained subject 13 to a confirmed Chapter 13 plan. In fact, it appears that some creditors do just that. Yes, this 14 would put more accurate information in the report and Congress ought to consider an 15 amendment to require such notations. But credit reports also include a clear-cut statement up 16 front that the debtor is in bankruptcy proceedings, so it takes very little imagination for the 17 reader to realize that there may be a plan in place that might lead to a full discharge. At all 18 events, the fact remains that the full amount is the actual truthful amount of the debt so long as 19 the plan, even if confirmed, remains uncompleted, so there is no basis for insisting as a matter of 20 law that such a notation accompany each line item. 21 This order makes the same ruling as to the California state law. Cal. Civ. Code § 17825. 22 Therefore, this entire action is hereby dismissed. If plaintiffs’ counsel wish to amend to 23 make some other claim for relief, such as the wrong dollar amount that accidentally got into the 24 report, then they may file a new amended complaint as to such other claim — but counsel’s main 25 point about the effect of a confirmed plan is wrong and may not be recycled into a new pleading. 26 27 28 2 1 The deadline for any new pleading in all these cases is APRIL 11, 2017, AT NOON, failing which 2 judgment will be entered. 3 4 IT IS SO ORDERED. 5 6 7 Dated: March 28, 2017. WILLIAM ALSUP UNITED STATES DISTRICT JUDGE 8 9 11 For the Northern District of California United States District Court 10 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?