Linlor v. JPMorgan Chase & Co. et al

Filing 28

ORDER Granting in Part and Denying in Part 23 Motion to Dismiss. JPMC is dismissed from this case. In all other respects, the Court denies Defendants' motion. Signed by Judge Roger T. Benitez on 8/9/2017. (All non-registered users served via U.S. Mail Service)(knb)

l,, '

F\LE.D

1
2

i\\IJ "ut -9 PM 2: e·i

3

Cl[~<" , -; "''· TRICT CQURT
,J. ....,··.•. "f cAWDR~ll•

4

·;aU1filfiHU-',':'Jil\·l"' v

--:::nn-·

5

OEPUT V

6
7

8

UNITED STATES DISTRICT COURT

9

SOUTHERN DISTRICT OF CALIFORNIA

10
11

JAMES LINLOR,

Case No.: l 7-cv-00005-BEN-KSC
Plaintiff,

12
13

v.

14

JPMORGAN CHASE & CO.; CHASE
BANKCARD SERVICES, INC.; and
CHASE BANK USA, NATIONAL
ASSOCIATION,

15
16

ORDER GRANTING IN PART AND
DENYING IN PART MOTION TO
DISMISS
[ECF No. 23]

Defendants.

17
18
19

Plaintiff James Linlor, proceeding prose, has filed an Amended Complaint ("AC")

20

alleging a violation of the Fair Credit Reporting Act ("FCRA"). (ECF No. 22). Presently

21

before the Court is the motion to dismiss Plaintiffs Amended Complaint filed by

22

Defendant Chase Bank USA, N.A. ("Chase"), specially appearing Defendant Chase

23

Bank.Card Services, Inc. ("CBSI"), and specially appearing Defendant JPMorgan Chase

24

& Co. ("JPMC"). (ECF No. 23). Plaintiff has opposed the motion (ECF No. 25), and

25

Defendants replied (ECF No. 26).

26

For the following reasons, the Court GRANTS Defendants' motion to dismiss for

27

lack of personal jurisdiction as to Defendant JPMC, but in all other respects, DENIES the

28

motion.

l 7-cv-00005-BEN-KSC

BACKGROUND 1

1
2

Plaintiff had a credit card issued by Defendants that was co-branded with a major

if 2, Background if 1).

In February 2016, Defendants notified Plaintiff

3

airline. (AC Intro.

4

by phone of likely fraud on his card, and Plaintiff confirmed notice of the potential fraud

5

in writing to Defendants within 10 days of Defendants' first call. (Id.) Plaintiff asked

6

Defendants to investigate the fraud. (AC Memo. if 3 & Ex. A). Defendants agreed to

7

remove the charges and issue Plaintiff a new card. (AC Background if 2 & Ex. D).

8

Accordingly, Defendants cancelled Plaintiffs credit card and issued him a new card, but

9

they also transferred the fraudulent charges to the new card. (AC Background if 2,

10

Memo. if 5). Plaintiff never received nor accepted the new card. (AC Memo. if 5 & Ex.

11

D). Upon becoming aware that Plaintiff had not received or accepted the new card,

12

Defendants "attempted to intimidate" Plaintiff into accepting the fraudulent charges, but

13

he refused. (AC Claims if 3a). Subsequently, Defendants reported an unpaid debt of

14

$2,223 to consumer reporting agencies ("CRAs"). (AC Memo.

15

Claims if 3a, Ex. D).

16

if 3, Background if 2,

In August 2016, Plaintiff contacted three CRAs to inform them about Defendants'

17

misreporting and request that they investigate and work with Defendants to correct and

18

remove the false reporting. (AC Memo. if 7 & Ex. D). Nevertheless, Defendants

19

continued to report erroneous information to CRAs, leading Plaintiff to file tlte instant

20

lawsuit. (AC Intro. if 4, Memo. if 8). Defendants' actions have damaged Plaintiffs credit

21

score, increased his interest rates, threatened his employment, and prevented him from

22

using his airlines rewards points for flights. (AC Intro.

23

III

24

Ill

if 4, Background if 2).

25
26
27
28

1

The Court is not making any findings of fact, but ratlter, summarizing the relevant
allegations of the Amended Complaint for purposes of evaluating Defendants' motion to
dismiss.
2
17-cv-00005-BEN-KSC

1
2

3

DISCUSSION
I.

Motion to Dismiss CBSI and JPMC for Lack of Personal Jurisdiction
Specially appearing Defendants CBSI and JPMC move to dismiss the complaint

4

for lack of personal jurisdiction. Such a motion is properly taken as a Rule 12(b)(2)

5

motion under the Federal Rules of Civil Procedure. On a Rule 12(b)(2) motion, the

6

plaintiff bears the burden of establishing personal jurisdiction. Wash. Shoe Co. v. A-Z

7

Sporting Goods, Inc., 704 F.3d 668, 671-72 (9th Cir. 2012). Where, as here, the motion

8

is based on written materials and affidavits rather than an evidentiary hearing, a plaintiff

9

is only required to make a "prima facie showing of jurisdictional facts to withstand the

10

motion to dismiss." Martinez v. Aero Caribbean, 764 F.3d 1062, 1066 (9th Cir. 2014)

11

(quoting Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004)).

12

A "prima facie" showing means that the plaintiff need only demonstrate facts that, if true,

13

would support jurisdiction over the defendant. Lindora, LLC v. Isagenix Int'!, LLC, 198

14

F. Supp. 3d 1127, 1135 (S.D. Cal. 2016). In determining whether a plaintiff has met his

15

burden, "uncontroverted allegations in [the] complaint must be taken as true, and

16

'conflicts between the facts contained in the parties' affidavits must be resolved in [the

17

plaintiffs] favor for purposes of deciding whether a prima facie case for personal

18

jurisdiction exists."' Am. Tel. & Tel. Co. v. Compagnie Bruxelles Lambert, 94 F.3d 586,

19

588-89 (9th Cir. 1996) (quoting WNS, Inc. v. Farrow, 884 F.2d 200, 203 (5th Cir. 1989)

20

(internal citations omitted)).

21

"Where, as here, no federal statute authorizes personal jurisdiction, the district

22

court applies the law of the state in which the court sits." Mavrix Photo, Inc. v. Brand

23

Techs., Inc., 647 F.3d 1218, 1223 (9th Cir. 2011) (internal citations omitted).

24

California's long-arm statute permits its courts to exercise personal jurisdiction "on any

25

basis not inconsistent with the Constitution of this state or of the United States." Daimler

26

AG v. Bauman, 134 S. Ct. 746, 753 (2014) (quoting Cal. Civ. Proc. Code§ 410.10).

27

Thus, "California's long-arm statute allows the exercise of personal jurisdiction to the

28

full extent permissible under the U.S. Constitution," and the Court must ensure that its
3
l 7-cv-00005-BEN-KSC

1

assertion of personal jurisdiction over a party comports with the limits imposed by

2

federal due process. Id. (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 464

3

(1985)). The traditional bases of personal jurisdiction that comport with due process are

4

service while physically present in the forum, domicile, or consent. None of the

5

traditional bases of jurisdiction are at issue here. Absent the traditional bases, a

6

defendant must have such "minimum contacts" with the forum state that "maintenance of

7

the suit does not offend traditional notions of fair play and substantial justice." Int 'l Shoe

8

Co. v. Washington, 326 U.S. 310, 316 (1945).

Personal jurisdiction can be either "general" or "specific." See Helicopteros

9
10

Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 415-16 (1984). Defendants argue

11

that Plaintiff has not met his burden to show that this Court has either general or specific

12

jurisdiction over Defendants JPMC and CBSI. The Court agrees as to JPMC but

13

disagrees as to CBSI.

14

A. General Jurisdiction

15

General jurisdiction allows a defendant to be brought into court for its activities

16

anywhere in the world, untethered from its specific contacts with the forum. Martinez,

17

764 F .3d at 1066. "General jurisdiction over a corporation is appropriate only when the

18

corporation's contacts with the forum state 'are so constant and pervasive as to render it

19

essentially at home' in the state." Id. (quoting Daimler, 134 S. Ct. at 751 ). The

20

paradigmatic locations where general jurisdiction is appropriate over a corporation are its

21

place of incorporation and its principal place of business. Daimler, 134 S. Ct. at 760.

22

"Only in an 'exceptional case' will general jurisdiction be available anywhere else."

23

Martinez, 764 F.3d at 2070 (quoting Daimler, 134 S. Ct. at 761 n.19).

24

In this case, JPMC and CBSI are neither incorporated in California, nor is their

25

principal place of business in California. Furthermore, there are no allegations about

26

Defendants' contacts with the State to justify treating this as an "exceptional case."

27

Accordingly, Plaintiff has failed to carry his burden of establishing general jurisdiction.

28

///
4
l 7-cv-00005-BEN-KSC

1

B. Specific Jurisdiction

2

Specific jurisdiction exists "when a case 'aris[es] out of or relate[s] to the

3

defendant's contacts with the forum.'" Martinez, 764 F.3d at 1066 (quoting

4

Helicopteros, 466 U.S. at 414 n.8); Bristol-Myers Squibb Co. v. Super. Ct. a/Cal., San

5

Francisco Cnty., 13 7 S. Ct. 1773, 1780 (2017) ("In order for a state court to exercise

6

specific jurisdiction, 'the suit' must 'aris[e] out of or relat[e] to the defendant's contacts

7

with the forum."' (emphasis in original)); Walden v. Fiore, 134 S. Ct. 1115, 1121 (2014)

8

("For a State to exercise jurisdiction consistent with due process, the defendant's suit-

9

related conduct must create a substantial connection with the forum State.").

10
11
12
13
14
15
16
17

The Ninth Circuit uses a three-part test to determine whether a defendant's
contacts with the forum state are sufficient to subject it to specific jurisdiction:
(l)The non-resident defendant must purposefully direct his activities or
consummate some transaction with the forum or resident thereof, or
perform some act by which he purposefully avails himself of the
privilege of conducting activities in the forum, thereby invoking the
benefits and protections of its laws;
(2)The claim must be one which arises out of or relates to the defendant's
forum-related activities; and
(3)The exercise of jurisdiction must comport with fair play and substantial
justice, i.e., it must be reasonable.

18
19

Picot v. Weston, 780 F.3d 1206, 1212 (9th Cir. 2015). The Supreme Court has

20

emphasized that "it is the defendant, not the plaintiff or third parties, who must

21

create contacts with the forum State" itself, not with persons who reside there.

22

Walden, 134 S. Ct. at 1123-26. The plaintiff has the burden of proving the first

23

two prongs and, if met, the burden shifts to the defendant to "set forth a compelling

24

case" as to the third. Picot, 780 F.3d at 1212.

25

Here, Plaintiff argues that this Court has jurisdiction over JPMC because it is

26

"the umbrella managing company" that provides IT services to the co-Defendants.

27

Specifically, JPMC allegedly owns and manages the website Chase.com and the

28

email address @chase.com, which its co-Defendants use. Plaintiff emailed with a
5
l 7-cv-00005-BEN-KSC

1

CBSI representative to dispute the allegedly erroneous reporting. In response,

2

Defendant JPMC argues that it is merely a holding company and that Plaintiff has

3

failed to allege any specific conduct by it.

4

"The existence of a relationship between a parent company and its

5

subsidiaries is not sufficient to establish personal jurisdiction over the parent on the

6

basis of the subsidiaries' minimum contacts with the forum." Doe v. Unocal

7

Corp., 248 F.3d 915, 925 (9th Cir. 2001). Plaintiff has only alleged that JPMC

8

provided technology services that its subsidiaries used. He has not stated how

9

JPMC itself created contacts with California. Accordingly, Plaintiff has failed to

10

establish a prima facie case for specific personal jurisdiction over Defendant

11

JPMC. See Cybersell, Inc. v. Cybersell, Inc., 130 F.3d 144, 419 (9th Cir. 1997)

12

(hosting a passive website is insufficient to establish purposeful availment or

13

purposeful direction towards forum state).

14

However, Plaintiff has satisfied his burden with respect to specific personal

15

jurisdiction over Defendant CBSI. In his opposition to Defendants' motion,

16

Plaintiff states that the phone number printed on the back of his Chase credit card

17

was for CBSI. When he called that number to dispute the charges, a CBSI

18

representative answered the phone. It is unclear if CBSI ever called Plaintiff

19

directly. However, it is appears that CBSI emailed Plaintiff. Plaintiff provides an

20

email dated March 15, 2016, in which Andre Cook from "Card Services Executive

21

Office" writes to Plaintiff that he has "completed [his] review and would like to

22

discuss [his] findings with" Plaintiff. (Pl.'s Opp'n Ex. A). Mr. Cook further

23

states, "IfI am unable to speak to you within the next 24 hours, I will follow up in

24

a letter. You can reach me at 1-888-622-7547 extension 654-8022." (Id.)

25

Mr. Cook also emailed Plaintiff on April 14, 2016, asking Plaintiff to call

26

him. (Id.) In response, Plaintiff wrote back several times. In the first response on

27

April 14, Plaintiff writes, "I called and provided all the information requested to

28

your colleagues today. I was promised a callback by you-you did not call today ..
6
l 7-cv-00005-BEN-KSC

1

.. Any new card must not be linked to existing fraudulent charges, for which I

2

have been held not liable, and followed California and federal law to maintain as

3

such. I will not pay for charges that Chase itself has identified as fraudulent." (Id.)

4

Plaintiff wrote back two more times, on April 15 and April 20, complaining that he

5

still had not heard from Mr. Cook. (Id.)
Thus, Plaintiff contends that the Court has personal jurisdiction over CBSI

6
7

because it handled "the calls for credit card servicing, while sending out emails

8

[e-mail] email address." Defendants do not dispute these

9

communications and fail to address their import in the reply brief. 2 Based on

10

Plaintiffs uncontroverted statements, the Court finds that Plaintiff has established

11

a prima facie case for asserting personal jurisdiction over CBSI. By listing its

12

phone number on Chase credit cards and consequently engaging in

13

communications with Plaintiff, a California resident, about the card dispute, CBSI

14

has purposefully directed its activities to the forum state. CBSI's contact with the

15

forum state was not "random" or "fortuitous." Burger King Corp., 471 U.S. at 475

16

("Th[e] 'purposeful availment' requirement ensures that a defendant will not be

17

haled into a jurisdiction solely as a result of 'random,' 'fortuitous,' or 'attenuated'

18

contacts."). Rather, CBSI has held itself out as the Chase entity that card holders

19

should contact for card servicing inquiries. CBSI voluntarily associated itself with

20

this forum for the purpose of conducting business, availing itself of the benefits

21

and protections of this State's laws. See id. at 476 ("Thus where the defendant

22

'deliberately' has engaged in significant activities within a State, or has created

23

'continuing obligations' between himself and residents of the forum, he manifestly

24
25

26
27
28

2

Defendants contend that CBSI is not a "furnisher of information" under the
FCRA and thus is not the proper party to this lawsuit. But such an argument is one
for failure to state a claim, not lack of personal jurisdiction.
7
17-cv-00005-BEN-KSC

1 has availed himself of the privilege of conducting business there, and because his
2

activities are shielded by 'the benefits and protections' of the forum's laws it is

3

presumptively not unreasonable to require him to submit to the burdens of

4

litigation in that forum as well. ... So long as a commercial actor's efforts are

5

'purposefully directed' toward residents of another State, we have consistently

6

rejected the notion that an absence of physical contacts can defeat personal

7

jurisdiction there."); Int'l Shoe Co., 326 U.S. at 319 ("[T]o the extent that a

8

corporation exercises the privilege of conducting activities within a state, it enjoys

9

the benefits and protections of that state. The exercise of that privilege may give

10

rise to obligations; and, so far as those obligations arise out of or are connected

11

with the activities within the state, a procedure which requires the corporation to

12

respond to a suit brought to enforce them can, in most instances, hardly be said to

13

be undue.").

14

Further, Plaintiffs claim relates to CBSI's forum-related conduct. Plaintiff

15

and CBSI corresponded regarding allegedly fraudulent charges on Plaintiffs card.

16

Plaintiff claims that CBSI did not correct those charges, as the parties agreed,

17

which led to him contacting CRAs. Plaintiffs FCRA claim seeks to hold

18

Defendants liable for failing to re-investigate the disputed information as

19

statutorily required upon notice to the CRAs. Had CBSI resolved Plaintiffs

20

reports of fraudulent charges upon his first contact with its representatives, he

21

would not have contacted the CRAs and the instant lawsuit would not have been

22

filed.

23

Accordingly, Plaintiff has satisfied his burden as to the first two prongs.

24

CBSI has not set forth any arguments why the exercise of personal jurisdiction

25

would not be fair or reasonable. Nevertheless, the Court will consider whether the

26

assertion of personal jurisdiction would comport with "fair play and substantial

27

justice." Int'l Shoe Co., 326 U.S. at 320. Courts evaluate the burden on the

28

defendant, the forum state's interest in adjudicating the dispute, the plaintiffs
8
l 7-cv-00005-BEN-KSC

1 interest in obtaining convenient and effective relief, the interstate judicial system's
2

interest in obtaining the most efficient resolution of controversies, and the shared

3

interest of the states in furthering fundamental substantive social policies. Burger

4

King Corp., 471 U.S. at 477.

5

California has a strong interest in ensuring that its residents' credit disputes

6

are serviced properly. Erroneous credit information reported to CRAs may affect

7 the card holder's ability to qualify for loans and employment status, among other
8

things. Plaintiff has a strong interest in obtaining relief in this forum, where he

9

resides and where the effects of Defendants' alleged misconduct are most likely to

10

be felt. In contrast, CBSI has not made any case that litigating in this forum would

11

be inconvenient and burdensome. And, finally, the judicial system's interest in

12

efficient resolutions of controversies, and the states' shared interest in fundamental

13

social policies, neither support nor undercut the exercise of jurisdiction here. The

14

Court therefore concludes that exercising personal jurisdiction over CBSI would be

15

reasonable.

16

As explained above, the Court denies Defendants' motion to dismiss for lack

17

of personal jurisdiction as to Defendant CBSI, but grants it as to Defendant JPMC.

18

II.

Motion to Dismiss for Violation of Rule 8

19

Defendants move to dismiss Plaintiffs amended complaint for being "vague and

20

conclusory as to be unintelligible." (Mot. at 6). Specifically, Defendants argue that the

21

amended complaint fails to meaningfully distinguish among Defendants Chase, CBSI,

22

and JPMC. Plaintiffs complaint generally refers to "Defendants" collectively.

23

Federal Rule of Civil Procedure 8 provides that a "pleading that states a claim for

24

relief must contain ... a short and plain statement of the claim showing that the pleader is

25

entitled to relief." Fed. R. Civ. P. 8(a). "Each allegation must be simple, concise, and

26

direct." Fed. R. Civ. P. 8(d). However, a "prose complaint, 'however inartfully

27

pleaded,' must be held to 'less stringent standards than formal pleadings drafted by

28

lawyers' and can only be dismissed for failure to state a claim ifit appears 'beyond doubt
9
l 7-cv-00005-BEN-KSC

1 that the plaintiff can prove no set of facts in support of his claim which would entitle him
2

to relief."' Estelle v. Gamble, 429 U.S. 97, 106 (1976) (internal citations omitted).
While Plaintiffs amended complaint is not of the sort that a lawyer would

3
4

typically compose, it sets forth a basic statement of his claim: He has a Chase credit

5

card. He was the victim of fraudulent charges on his credit card in February 2016. He

6

spoke to Defendants about the alleged fraud but they did not take corrective action.

7

Defendants reported the fraudulent charges as unpaid debts to CRAs. Plaintiff contacted

8

the CRAs to investigate the false report. The CRAs contacted Defendants. Defendants

9

continued to report the allegedly false information.

10

Furthermore, the Court is not persuaded that it should dismiss the amended

11

complaint for not distinguishing among the acts of each individual Defendant. Plaintiff

12

seeks to hold the "furnisher of information" liable for failure to reinvestigate information

13

that it reported to CRAs which Plaintiff disputes. His complaint alleges that Defendants

14

are "furnishers" under the FCRA. (AC Standing 12). The FCRA does not define

15

"furnishers," but a plain reading of the statute indicates that the term "furnisher" refers to

16

a person who provides information about a consumer to a CRA. See 15 U.S.C. § 1681 s-

17

2.

18

In Plaintiffs opposition, he explains that he does not know yet which Chase entity

19

acted as the furnisher. His credit report only lists "Chase," and the CRAs will not

20

identify which Chase entity reported information to them. Defendants argue that Chase

21

Bank, N.A. is the furnisher, but provide no evidentiary foundation for the Court to

22

conclude that CBSI-the other remaining Defendant and the one that communicated with

23

Plaintiff about his dispute-did not act as a furnisher. Plaintiff contends that Defendants

24

"should remain as being held to account, until or unless such time as they will provide

25

proof beyond their unsupported assertions as to which Chase entity ... reported false

26

Ill

27

III

28

III
10
17-cv-00005-BEN-KSC

1

information to the CRAs." (Opp'n at 6). This Court agrees as to Chase and CBSI, the

2

Defendants over which this Court has personal jurisdiction. 3

3

The Court finds that Plaintiff has satisfied his obligations under Rule 8 and thus

4

denies Defendants' motion to dismiss on this ground.

5

III.

Motion to Dismiss for Failure to State a Claim

6

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) must be

7

granted where the pleadings fail to state a claim upon which relief can be granted. When

8

considering a Rule 12(b)(6) motion, the court must "accept as true facts alleged and draw

9

inferences from them in the light most favorable to the plaintiff." Stacy v. Rederite Otto

10

Danielsen, 609 F.3d 1033, 1035 (9th Cir. 2010). A plaintiff must not merely allege

11

conceivably unlawful conduct but must allege "enough facts to state a claim to relief that

12

is plausible on its face." Bell At!. Corp. v. Twombly, 550 U.S. 544, 570 (2007). "A claim

13

is facially plausible 'when the plaintiff pleads factual content that allows the court to

14

draw the reasonable inference that the defendant is liable for the misconduct alleged.'"

15

Zixiang Liv. Kerry, 710 F.3d 995, 999 (9th Cir. 2013) (quoting Ashcroft v. Iqbal, 556

16

U.S. 662, 678 (2009)). "Threadbare recitals of the elements ofa cause of action,

17

supported by mere conclusory statements, do not suffice." Iqbal, 556 U.S. at 678.

18

The FCRA subjects furnishers to two distinct duties. First, under 15 U.S.C. §

19

1681s-2(a), furnishers have a duty to provide accurate information to a CRA. Gorman v.

20

Wolpoff & Abramson, LLP, 584 F.3d 1147, 1153-54 (9th Cir. 2009). It is well-settled

21

however, that there is no private right of action for violations of section 1681s-2(a). See

22

15 U.S.C. § 1681s-2(c) (stating that section 16810, which confers a private right of action

23

for the willful or negligent noncompliance with the FCRA, does "not apply to any

24

violation of ... subsection (a) of ... section [1681s-2]"); see also Gorman, 584 F.3d at

25

1154 ("Duties imposed on furnishers under [15 U.S.C. § 1681s-2(a)] are enforceable only

26
27
3

28

The Court notes that Chase has not challenged this Court's personal jurisdiction;
therefore, the Court assumes that it has personal jurisdiction over Chase.
11
l 7-cv-00005-BEN-KSC

1

by federal or state agencies."). Second, under 15 U.S.C. § 1681s-2(b), furnishers have a

2

duty to undertake an investigation upon receipt of a notice of dispute from a CRA.

3

Gorman, 584 F.3d at 1154. However, the duty to investigate is triggered "only after the

4

furnisher receives notice of dispute from a CRA." Id.

5
6

Defendants argue that Plaintiffs section 1681s-2(b) claim should be dismissed for
three reasons. Each argument fails.
First, they argue that Plaintiff does not allege that a CRA transmitted notice of a

7
8

dispute to Defendants, the furnishers. However, Plaintiff does include such an allegation.

9

He pleads that "Defendants (after by standard processes receiving notice and requests

10

from CRAs), still did not correct reporting to CRAs." (AC Background, 3).

11

Second, Defendants argue that Plaintiff has not alleged that Chase failed to

12

reasonably reinvestigate a dispute provided by the CRAs. Section 1681s-2(b) provides

13

that, after receiving a notice of dispute, the furnisher shall:

14

(A) Conduct an investigation with respect to the disputed information;
(B) Review all relevant information provided by the [CRA] ... ;
(C) Report the result of the investigation to the [CRA];
(D) If the investigation finds that the information is incomplete or inaccurate,
report those results to all other [CRAs] to which the person furnished the
information ... ; and
(E) If an item of information disputed by a consumer is found to be inaccurate or
incomplete or cannot be verified after any reinvestigation under paragraph (1 ),
for purposes of reporting to a [CRA] only, ... (i) modify that item of
information; (ii) delete that item of information; or (iii) permanently block the
reporting of that information.

15
16
17
18
19
20
21
22

15 U.S.C. § 1681s-2(b)(l).
The Court again disagrees with Defendants Although many of Plaintiffs

23
24

allegations are phrased in terms of Defendants failing to correct the alleged

25

misreporting, 4 he also alleges that the reports required by section 1681s-2(b) contained

26
27
4

28

In Baldin v. Wells Fargo Bank, N.A., No. 3:12-CV-00648-AC, 2013 WL 6388499, at
*7-8 (D. Or. Dec. 6, 2013), the U.S. District Court for the District of Oregon
12
l 7-cv-00005-BEN-KSC

1 false, misleading, and defamatory information. (AC Memo. if 2a). A reasonable
2

inference from Plaintiffs allegations is that Defendants did not reasonably investigate the

3

dispute. Grismore v. Capital One F.S.B., No. CV 05-2460 PHXSMM, 2007 WL 841513,

4

at *4 (D. Ariz. Mar. 16, 2007) ("Plaintiff alleges that COS has reported and verified

5

inaccurate information to the credit reporting agencies, from which it can ... be inferred

6

that COS did not follow proper investigatory procedures after it received notice from a

7

credit reporting agency.").

8
9

Third, and finally, Defendants argue that the amended complaint fails to
adequately plead the inaccuracy at the heart of the dispute. "To state a claim under the

10

FCRA, [a plaintiff is] required, at a minimum, to allege factual content showing an

11

inaccuracy in his credit report." Bankes v. ACS Educ., 638 F. App'x 587, 590 (9th Cir.

12

2016) (citing Gorman, 584 F.3d at 1154, 1162). While Plaintiffs amended complaint is

13

not a model of clarity, he alleges that "Defendants eventually calculated and reported

14

against Plaintiffs credit a value of $2,223 as a charge-off (bad credit debt against

15

Plaintiff) on Plaintiffs credit card ... despite the amount being in dispute with Plaintiff."

16

(AC Memo. if 3). This is sufficient to survive a motion to dismiss.

17

III

18

III

19

III

20
21
22
23
24
25
26
27
28

distinguished between allegations of failure to correct misinformation and allegations of
failure to conduct the investigation in accordance with the duties prescribed by section
1681s-2(b)(l). There, the court found that the plaintiffs allegations demonstrated that
the furnisher had addressed the dispute and that plaintiffs challenge was to the manner in
which the furnisher processed and applied her loan payments. The court held that the
"provisions of [the] FCRA do not require [the furnisher] to ignore its policies and
procedures related to the processing and application of loan payments by modifying or
deleting information provided to the CRAs simply because the consumer disagrees." Id.
at *8. "Nothing in§ 1681s-2(b) ... requires [the furnisher] to correct information simply
because the consumer believes it is erroneous." Id.
13
17-cv-00005-BEN-KSC

1
2

CONCLUSION
The Court GRANTS Defendants' motion to dismiss specially appearing Defendant

3

JPMC for lack of personal jurisdiction. JPMC is dismissed from this case. In all other

4

respects, the Court DENIES Defendants' motion.

5

IT IS SO ORDERED.

6
7
8

Dated: August ~' 2017

n(J~~f:-.

enitez
United States District Judge

9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
14
l 7-cv-00005-BEN-KSC