Qureshi et al v. Penkhus Motor Company
MEMORANDUM OPINION AND ORDER by Magistrate Judge Nina Y. Wang on 9/26/16. Defendant Penkhus Motor Company's Motion for Summary Judgment 12 is DENIED; and The Final Pretrial Conference set for 9/27/2016 REMAINS SET. (bwilk, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 15-cv-02337-NYW
PENKHUS MOTOR COMPANY,
MEMORANDUM OPINION AND ORDER
Magistrate Judge Nina Y. Wang
This matter comes before the court on Defendant Penkhus Motor Company’s Motion for
Summary Judgment [#12, filed on June 20, 2016] pursuant to the Parties’ consent under 28
U.S.C. § 636(c) and the Order of Reference dated December 29, 2015 [#9]. The court has
reviewed the Parties’ briefing [#12, # 14, and #16], heard argument on the motion on August 23,
2016, and has considered the applicable case law. For the reasons set forth herein, the court
hereby DENIES the Motion for Summary Judgment for the following reasons.
This case arises under Federal Credit Reporting Act (“FCRA”). In their unverified
Complaint, Plaintiffs Huzma Qureshi (“Mr. Qureshi”) and Lauryn Qureshi (collectively,
“Plaintiffs” or “the Qureshis”) allege that they are individual consumers who reside in Colorado
Springs, Colorado. [#1 at ¶ 2]. On or about August 3, 2015, Mr. Qureshi contacted Penkhus
Motor Company (“Penkhus”) about potentially purchasing a vehicle. [Id. at ¶ 4]. On August 4,
2015, one of Defendant’s sales representatives emailed Mr. Qureshi, stating “Glad to hear your
(sic) ready to get an Evo. … I understand your (sic) trading in a 2014 Honda this Time (sic). 1 I
will speed the process up by doing a sight unseen appraisal with you.” [#12-1 at 5]. As part of
the “sight unseen appraisal,” Defendant asked Mr. Qureshi to provide detailed information about
his 2014 Honda. [Id.]. Not soon after, Mr. Qureshi provided the requested information and
stated, “Thank you for doing this. … We are actually interested in a GSR this time around.” [Id.
at 6]. In that same email correspondence, Mr. Qureshi stated, “Credit info slightly different.
Wife will now be primary. My income changed to $84,000 yearly. Address and employer are
the same.” [Id.]. Later that afternoon, Defendant informed Mr. Qureshi of the value of his 2014
Honda and stated, “We will need a good size down payment,” to which Mr. Qureshi replied,
“What would be a good sized down payment be on a GSR?” [Id.]. This was the extent of the
correspondences between Mr. Qureshi and Defendant provided to the court, [id.], and Plaintiffs
apparently did not provide express written or oral authorization to the Penkhus sales person to
obtain their credit reports, [#1 at ¶¶ 5-6].
On or about August 4, 2015, Penkhus obtained both Plaintiffs’ credit reports from three
major consumer credit reporting agencies: Equifax, Experian, and Trans Union. [#10 at 4].
Plaintiffs allege that the Defendant had neither authorization nor any other permissible purpose
under the FCRA to obtain their credit reports thus violating the FCRA. [#1 at ¶ 12]. Plaintiffs
further allege that Defendant’s violation was willful, thus entitling Plaintiffs to actual damages,
statutory damages, punitive damages, attorney fees and costs. [Id. at ¶ 13]. Alternatively,
As discussed below, the Qureshis had contacted Penkhus in February 2015 regarding the
purchase of a car, but the sale was not consummated. [#12 at 1, 3].
Plaintiffs contend that even if Defendant’s violation was negligent, they are still entitled to actual
damages, attorney fees, and costs. [Id. at ¶ 14].
In moving for summary judgment, Penkhus argues that it only accessed Plaintiffs’ credit
reports with authorization from Plaintiffs, or for another permissible purpose, namely that it had
a legitimate business need for the information in connection with the purchase of a vehicle from
Penkhus. [#12 at 5-8]. It urges the court to grant summary judgment based on a written
authorization executed by the Qureshis six months prior to the incident at issue, in February
2015. [#12 at 5-6]. It further contends that summary judgment is proper because Penkhus had a
legitimate business need for the information because “Plaintiffs contacted the salesperson Mr.
Clarke at Penkhus Motors on August 4, 2015, indicating they wanted to move forward with a
Plaintiffs argue, but do not submit any testimony through
declarations or otherwise, that in August 2015, Plaintiffs “merely inquired about obtaining a
price on a trade in and a different car. Defendant then pulled Plaintiffs’ credit reports without
Plaintiffs’ permission and without having a permissible purpose under the Fair Credit Reporting
Act (FRCA).” [#14 at 2]. In Reply, Defendant argues that “[the] communications [between
Penkhus and Plaintiffs] speak for themselves, and by indicating ‘this time around,’ make clear
that the Plaintiffs were intending to purchase a vehicle again in early August 2015.” [#16 at 2].
Summary judgment is appropriate only if “the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R.
Civ. P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Henderson v. Inter–Chem
Coal Co., Inc., 41 F.3d 567, 569 (10th Cir. 1994). “A ‘judge’s function’ at summary judgment is
not ‘to weigh the evidence and determine the truth of the matter but to determine whether there is
a genuine issue for trial.’” Tolan v. Cotton, 134 S.Ct. 1861, 1866 (2014) (quoting Anderson v.
Liberty Lobby, 477 U.S. 242, 249 (1986)). Whether there is a genuine dispute as to a material
fact depends upon whether the evidence presents a sufficient disagreement to require submission
to a jury or conversely, is so one-sided that one party must prevail as a matter of law. Anderson,
477 U.S. at 248–49; Stone v. Autoliv ASP, Inc., 210 F.3d 1132, 1136 (10th Cir. 2000); Carey v.
U.S. Postal Service, 812 F.2d 621, 623 (10th Cir. 1987). A fact is “material” if it pertains to an
element of a claim or defense; a factual dispute is “genuine” if the evidence is so contradictory
that if the matter went to trial, a reasonable party could return a verdict for either party.
Anderson, 477 U.S. at 248. “Where the record taken as a whole could not lead a rational trier of
fact to find for the non-moving party, there is no ‘genuine issue for trial.’” Matsushita Elec.
Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (citing First Nat. Bank of Ariz.
v. Cities Service Com, 391 U.S. 253, 289 (1968)).
In reviewing a motion for summary judgment the court views all evidence in the light
most favorable to the non-moving party. See Garrett v. Hewlett-Packard Co., 305 F.3d 1210,
1213 (10th Cir. 2002). Only when a moving party establishes that the absence of any genuine
issue of material fact does the burden shift to the non-moving party to go beyond the pleadings
and set forth specific facts that would be admissible. Anderson, 477 U.S. at 248. If the nonmoving party carries its burden, the nonmovant must establish, at a minimum, an inference of the
presence of each element essential to the case. Hulsey v. Kmart, Inc., 43 F.3d 555, 557 (10th Cir.
1994) (citation omitted). In doing so, the non-moving party “may not rest upon mere allegation
or denials of his pleadings, but must set forth specific facts showing that there is a genuine issue
for trial.” See also Anderson, 477 U.S. at 256. To be considered by the court, the evidence must
be admissible, and the court views such admissible evidence in the light most favorable to the
non-moving party. Dodson v. Bd. of Cty. Comm'rs, 878 F. Supp. 2d 1227, 1239 (D. Colo. 2012)
(citations omitted). Any factual ambiguities are resolved against the moving party, favoring the
right to trial. Id. (citing Quaker State Minit–Lube, Inc. v. Fireman's Fund Ins. Co., 52 F.3d 1522,
1527 (10th Cir.1995); Houston v. Nat'l Gen. Ins. Co., 817 F.2d 83, 85 (10th Cir.1987)).
Congress established the Fair Credit Reporting Act in 1970 to ensure “fair and accurate
credit reporting, promote efficiency in the banking system, and protect consumer privacy.”
Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 52 (2007) (emphasis added). To that end, the FCRA
limits the circumstances in which a credit reporting agency may provide a consumer’s credit
report. 15 U.S.C. § 1681b(a)(2). There are three statutory provisions that are relevant to this
action. A credit agency may furnish a consumer’s credit report to a third party upon written
instruction by the consumer to whom it relates. Id. at §1681b(a)(2). A person or entity who
“intends to use the information in connection with a credit transaction involving the consumer on
whom the information is to be furnished” may also access the credit report.
Id. at §
1681b(a)(3)(A). Finally, a person or entity may also obtain an individual’s credit report for a
legitimate business need under 15 U.S.C. § 1681b(1)(3)(F)(i).
The Parties do not dispute the applicable law, but they do contest whether Penkhus was
authorized to obtain the Qureshis’ respective credit reports on August 4, 2015, based on
authorizations executed in February 2015 or based on other permitted purposes. Under the
FCRA, it is the plaintiff’s burden to establish that his or her credit information was obtained for
an impermissible purpose, and it is the defendant’s burden to establish a permissible purpose as a
complete defense. See Ritchie v. Northern, 14 F.Supp.3d 229, 244 (S.D.N.Y. 2014) (explaining
the Parties’ burdens under 15 U.S.C. § 1681b); Glanton v. DirecTV, L.L.C., --- F.Supp.3d ---,
2016 WL 1177334, at *5–6 (D.S.C. Mar. 23, 2016) (holding that the plaintiff has the burden of
establishing that the defendant had no legitimate business purpose for obtaining her credit
This court is not prepared to rule that as a matter of law, a written authorization executed
in February 2015 is sufficient to permit Penkhus to obtain Plaintiffs’ credit reports six months
later, nor does the communication between the Parties constitute written authorization as a matter
of law. In the absence of written permission, an automobile dealer may obtain a credit report
“only in circumstances where it is clear both to the consumer and to the dealer that the consumer
is actually initiating the purchase or lease of a specific vehicle and, in addition, the dealer has a
legitimate business need for consumer information.” See Traveler v. Glenn Jones Ford Lincoln
Mercury 1987, Civil Action No. CV-05-0817-PHX-SRB, 2006 WL 173687, *4 (D. Ariz. Jan. 24
2006) (emphasis added).
While a close call, in reviewing the evidence submitted by the Parties, this court is not
persuaded that there is an absence of any genuine issue of material fact – despite the
correspondence that states “[c]redit info is slightly different,” [#12-1 at 6] and Plaintiffs’ failure
to submit their own testimony in rebuttal. Namely, the correspondence that both sides rely upon
may be reasonably interpreted in different ways. And there is no evidence in the record from
which the court can ascertain Plaintiffs’ expectation or understanding as to why Penkhus
accessed their credit reports. Defendant submits no testimony taken from Plaintiffs in which
they admit that they were initiating the purchase or lease of a specific vehicle, or that they were
authorizing Penkhus to access their credit reports for the purposes of providing specific
information about a specific car, and the burden lies with Defendant to establish a permissible
intent under FCRA. In light of the record before it, this court concludes that any issues with
respect to the interpretation of the correspondence; the understanding of the respective parties;
and the credibility of witnesses are for the jury to decide. 2
Therefore, IT IS ORDERED that:
Defendant Penkhus Motor Company’s Motion for Summary Judgment [#12] is
The Final Pretrial Conference set for September 27, 2016 REMAINS SET.
DATED: September 26, 2016
BY THE COURT:
s/Nina Y. Wang__________
United States Magistrate Judge
While the court does not pass on the ultimate merits of the claim, it does note that the
circumstances as presented on the record currently before this court does not support a finding of
any willful violation, if any violation occurred at all. Accordingly, at the Final Pretrial
Conference, the Parties should be prepared to address the viability of Plaintiffs’ claim that
Defendant willfully violated the FCRA and what damages are recoverable under a negligent
violation versus willful violation theory.
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