Harwood v. Disney et al
Filing
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MEMORANDUM OPINION. Signed by Judge Richard D. Bennett on 4/28/2016. (ca2s, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
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TIMOTHY BRENT HARWOOD,
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Plaintiff,
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v.
Civil Action No. RDB-15-2399
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DARREN EARL DISNEY t/a
DISNEY PROPERTIES, et al.,
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Defendants.
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MEMORANDUM OPINION
Plaintiff Timothy Brent Harwood (“Plaintiff” or “Harwood”) has brought this action
against Defendants Darren Earl Disney t/a Disney Properties (“Disney”) and Bay Area
Receivables, Inc. (“BAR”)1 (collectively “Defendants”), alleging violations of the Fair Credit
Reporting Act (“FCRA”), 15 U.S.C. § 1581 et seq.2, by both Defendants Disney and BAR
(Counts One and Three) and breach of contract by Defendant Disney (Count Two).
Compl. at ¶ 21-35, ECF No. 1. Currently pending before this Court is Defendant Disney’s
Motion to Dismiss all claims against him (ECF No. 7). The parties’ submissions have been
reviewed, and no hearing is necessary. See Local Rule 105.6 (D. Md. 2014). For the reasons
1 Plaintiff failed to effect service of process upon Defendant Bay Area Receivables within 120 days of filing
the Complaint. Therefore, this Court entered a Show Cause Order on April 20, 2016 (ECF No. 13), pursuant
to Local Rule 103.8(a) (D. Md. 2014), directing the Plaintiff to show cause why his claims against Defendant
Bay Area Receivables should not be dismissed. If Plaintiff fails to show good cause by May 4, 2016,
Defendant Bay Area Receivables shall be dismissed with prejudice from this case.
2 Plaintiff incorrectly cites the Fair Credit Reporting Act in his Complaint. The FCRA is codified at 15 U.S.C.
§ 1681 et seq. Plaintiff has since clarified in his Opposition to the pending motion (ECF No. 11) that he
alleges violations of 15 U.S.C. § 1681s-2(b) specifically. See discussion infra.
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that follow, Defendant Disney’s Motion to Dismiss (ECF No. 7) is GRANTED.
Accordingly, all claims asserted by Plaintiff against Defendant Disney are DISMISSED.
BACKGROUND
This Court accepts as true the facts alleged in the plaintiff’s complaint. See Aziz v.
Alcolac, Inc., 658 F.3d 388, 390 (4th Cir. 2011). On or about April 17, 2012, Plaintiff Timothy
Brent Harwood (“Plaintiff” or “Harwood”) “rented three residential properties” in Salisbury,
Maryland from Defendant Darren Earl Disney (“Defendant” or “Disney”), pursuant to
“ ‘Dwelling Lease[s].’ ” Compl. at ¶ 6,8, ECF No. 1. Harwood leased the properties for
approximately six months and, pursuant to the terms of the leases, paid Disney a $1,000
security deposit for each property. Id. at ¶ 7, 9. Upon expiration of the leases, Disney
submitted three letters to Harwood itemizing “various ‘charges’ against [his] account for
items including, but not limited to, light bulbs, trash removal, stove drip pans, rekeying
locks, refrigerator shelves and air filters.” Id. at ¶ 10-11. Accordingly, Disney “retained all of
the deposit funds and claimed an additional One Thousand Eight Hundred Seventeen
Dollars and Twenty Eight cents for a total of Four Thousand Eight Hundred Seventeen
Dollars and Twenty Eight Cents.” Id. at ¶ 12.
Harwood claims that he “requested additional information to clarify the charges,” but
that Disney ignored his requests. Id. at ¶ 13. Disney eventually forwarded the matter to
Defendant Bay Area Receivables, Inc. (“Defendant” or “BAR”), who caused the debt to be
reported on the Plaintiff’s credit report. Id. at 14-15. On April 12, 2014, Harwood, with the
assistance of counsel, sent letters to Disney and to BAR “requesting, inter alia, supporting
documentation for the charges and asking that Defendant provide the name of the Maryland
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real estate licensee affiliated with Defendant Disney’s operations.” Id. at ¶ 16-17. Harwood
claims that both Disney and BAR ignored the letter, declined to provide supporting
documentation for the charges, declined to provide the name of the broker of record, and
declined to “take any action to show that the debt was disputed by [Harwood].” Id. at ¶ 18.
Since the debt was reported on his credit report, Harwood “has been denied the benefit of
two commercial loans with the prospective lenders each citing the Disney Properties debt.”
Id. at ¶ 19. “An examination of Maryland Department of Labor and Licensing’s Real Estate
Commission’s records failed to identify defendant Disney as a licensed real estate broker,
associate broker or salesperson nor did the records identify a broker affiliated with Disney
properties.” Id. at ¶ 20.
Subsequently, Plaintiff filed the present action in this Court action against Defendants
Disney and BAR, alleging violations of the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. §
1581 et seq.3, by both Defendants (Counts One and Three) and breach of contract by
Defendant Disney (Count Two). Id. at ¶ 21-35. Plaintiff alleges that Disney “has failed to
comply with the duties imposed upon him [under the FCRA] by, among other things,
furnishing to defendant BAR inaccurate information, failing to notify defendant BAR that
the debt is disputed and failing to provide information to support his claim.” Id. at ¶ 23. He
alleges that “BAR failed to respond to the Plaintiff’s letter and apparently did nothing to
investigate the claims of the Plaintiff . . . , submitted information to the credit reporting
agency without informing the agency that the debt was disputed . . . ,” and failed to “update
information submitted to the credit reporting agency as required by the [FCRA].” Id. at ¶ 33.
3 As stated supra, Plaintiff has since clarified that he alleges violations of 15 U.S.C. § 1681s-2(b).
See
discussion infra.
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STANDARD OF REVIEW
Under Rule 8(a)(2) of the Federal Rules of Civil Procedure, a complaint must contain
a “short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.
R. Civ. P 8(a)(2). Rule 12(b)(6) of the Federal Rules of Civil Procedure authorizes the
dismissal of a complaint if it fails to state a claim upon which relief can be granted. The
purpose of Rule 12(b)(6) is “to test the sufficiency of a complaint and not to resolve contests
surrounding the facts, the merits of a claim, or the applicability of defenses.” Presley v. City of
Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006).
The Supreme Court’s opinions in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007),
and Ashcroft v. Iqbal, 556 U.S. 662 (2009), “require that complaints in civil actions be alleged
with greater specificity than previously was required.” Walters v. McMahen, 684 F.3d 435, 439
(4th Cir. 2012) (citation omitted). In Twombly, the Supreme Court articulated “[t]wo working
principles” that courts must employ when ruling on Rule 12(b)(6) motions to dismiss. Iqbal,
556 U.S. at 678. First, while a court must accept as true the factual allegations contained in
the complaint, the court is not so constrained when the factual allegations are conclusory or
devoid of any reference to actual events. United Black Firefighters v. Hirst, 604 F.2d 844, 847
(4th Cir. 1979). Moreover, a court need not accept any asserted legal conclusions drawn
from the proffered facts. Iqbal, 556 U.S. at 678. (stating that “[t]hreadbare recitals of the
elements of a cause of action, supported by mere conclusory statements, do not suffice” to
plead a claim); see also Wag More Dogs, LLC v. Cozart, 680 F.3d 359, 365 (4th Cir. 2012)
(“Although we are constrained to take the facts in the light most favorable to the plaintiff,
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we need not accept legal conclusions couched as facts or unwarranted inferences,
unreasonable conclusions, or arguments.” (internal quotation marks omitted)).
Second, a complaint must be dismissed if it does not allege “a plausible claim for
relief.” Iqbal, 556 U.S. at 679. Although a “plaintiff need not plead the evidentiary standard
for proving” her claim, she may no longer rely on the mere possibility that she could later
establish her claim. McCleary-Evans v. Maryland Department of Transportation, State Highway
Administration, 780 F.3d 582, 584 (4th Cir. 2015) (emphasis omitted) (discussing Swierkiewicz
v. Sorema N.A., 534 U.S. 506 (2002) in light of Twombly and Iqbal). Under the plausibility
standard, a complaint must contain “more than labels and conclusions” or a “formulaic
recitation of the elements of a cause of action.” Twombly, 550 U.S. at 555. While the
plausibility requirement does not impose a “probability requirement,” id. at 556, “[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; see also Robertson v. Sea Pines Real Estate Cos., 679 F.3d 278, 291 (4th Cir. 2012) (“A
complaint need not make a case against a defendant or forecast evidence sufficient to prove an
element of the claim. It need only allege facts sufficient to state elements of the claim.”
(emphasis in original) (internal quotation marks and citation omitted)). In making this
assessment, a court must “draw on its judicial experience and common sense” to determine
whether the pleader has stated a plausible claim for relief. Iqbal, 556 U.S. at 679. “At
bottom, a plaintiff must nudge [its] claims across the line from conceivable to plausible to
resist dismissal.” Wag More Dogs, LLC, 680 F.3d at 365 (internal quotation marks omitted).
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ANALYSIS
Defendant Disney argues that Plaintiff fails to state a claim against Disney under the
Fair Credit Reporting Act (“FCRA”). Mem. Supp. Mot. to Dismiss, p. 3, ECF No. 7-1.
Although the Complaint fails to specify which subsections of the FCRA Disney allegedly
violated, Disney operates under the assumption that Plaintiff intended to plead violations of
15 U.S.C. § 1681s-2(a) and 15 U.S.C. § 1681s-2(b). Id. at 4. In his Opposition, Plaintiff
“stipulates that the remedies available for alleged violations of 15 U.S.C. § 1681s-2(a) are
only available through select agencies and not through the Courts.” Pl. Opp’n., p. 2, ECF
No. 11 (citing 15 U.S.C. § 1681s-2(c), (d)); see also Akpan v. First Premier Bank, No. DKC 091120, 2010 WL 917886, at *3 (D. Md. Mar. 8, 2010) (observing that 15 U.S.C. § 1681s-2(a) is
“unenforceable through a private suit.”). Plaintiff then proceeds to discuss his claims in the
context of 15 U.S.C. § 1681s-2(b). Id. Accordingly, this Court will construe Plaintiff’s
Complaint as alleging a violation of 15 U.S.C. § 1681s-2(b) by Disney (Count One) and will
construe the pending motion as a Motion to Dismiss that claim.
If a consumer disputes the accuracy of information in a credit report, the consumer
may have a private right of action against the furnisher of the inaccurate information if the
furnisher fails to properly investigate a dispute. 15 U.S.C. § 1681s-2(b). 15 U.S.C. § 1681s2(b) provides as follows:
(b) Duties of furnishers of information upon notice of dispute
(1) In general
After receiving notice pursuant to section 1681i(a)(2) of this title of a
dispute with regard to the completeness or accuracy of any information
provided by a person to a consumer reporting agency, the person shall—
(A) conduct an investigation with respect to the disputed information;
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(B) review all relevant information provided by the consumer
reporting agency pursuant to section 1681i(a)(2) of this title;
(C) report the results of the investigation to the consumer reporting
agency;
(D) if the investigation finds that the information is incomplete or
inaccurate, report those results to all other consumer reporting
agencies to which the person furnished the information and that
compile and maintain files on consumers on a nationwide basis; 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 consumer reporting
agency only, as appropriate, based on the results of the reinvestigation
promptly-(i) modify that item of information;
(ii) delete that item of information; or
(iii) permanently block the reporting of that item of information.
However, a private cause of action arises under § 1681s-2(b) only when the debtor files a
dispute with the credit reporting agency and the furnisher of the information in turn receives
notice from the credit reporting agency that the consumer has filed a dispute. See Jackson v.
Convergent Outsourcing, Inc., No. RDB-13-1755, 2014 WL 722116, at *2 (D. Md. Feb. 25,
2014); Robinson v. Greystone Alliance, LLC, No. BPG–10–3658, 2011 WL 2601573, at *3 n. 6
(D. Md. June 29, 2011); see also SimmsParris v. Countrywide Fin. Corp., 652 F.3d 355, 359 (3d
Cir. 2011) (“Although consumer reporting agencies are subject to immediate suit by
consumers under §§ 1681n and 1681o, furnishers of the information are not. Instead, a
private citizen wishing to bring an action against a furnisher must first file a dispute with the
consumer reporting agency, which then must notify the furnisher of information that a dispute
exists. Only after this notification can the furnisher face any liability to a private individual.”)
(emphasis added).
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Here, Plaintiff has not alleged any facts showing that he filed a dispute with a credit
reporting agency or that Defendant Disney subsequently received notice of a dispute from
that credit reporting agency. Plaintiff alleges only that he notified Defendants Disney and
BAR directly of his dispute. Neither of them is a credit reporting agency. Furthermore,
even if these first two elements were satisfied, Plaintiff does not sufficiently allege that
Defendant Disney neglected his obligations under 15 U.S.C. § 1681s-2(b), see subsections
(A) – (E) supra, including conducting an investigation with respect to the disputed
information, reviewing all relevant information provided by the consumer reporting agency,
and reporting the results of the investigation to the consumer reporting agency.
Plaintiff appends to his Opposition brief an affidavit in which he indicates that he
“filed a dispute with Experian [a credit reporting agency], using their electronic dispute
protocols,” but that “all of the information was submitted online” and he does “not have
copies of the dispute.” Harwood Aff. at ¶ 1, ECF No. 11-1. Plaintiff argues that he
“should be entitled to discovery to determine how Experian provided notice to the
furnisher.” Pl. Opp’n, p. 2, ECF No. 11. Defendant Disney, in his own affidavit attached
to Defendant’s Reply brief, verifies that he has “not been contacted by or notified by
Experian or any other consumer reporting agency that Harwood disputes the debt.”
Disney Aff. at ¶ 9, ECF No. 12-2.
“The purpose of Rule 12(b)(6) is to test the legal sufficiency of a complaint” and not
to “resolves contests surrounding the facts, the merits of a claim, or the applicability of
defenses.” Presley v. City of Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006) (citing Edwards v.
City of Goldsboro, 178 F.3d 231, 243–44 (4th Cir. 1999)). When considering a motion to
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dismiss, this Court generally limits its review to the Plaintiff’s Complaint. See, e.g., Givens v.
Citimortgage, Inc., No. PJM-10-1249, 2011 WL 806463, at *3 (D. Md. Feb. 28, 2011).
Here, Plaintiff’s Complaint fails to satisfy the pleading requirements of Rule 8(a)(2) of the
Federal Rules of Civil Procedure, as articulated in Ashcroft v. Iqbal, 556 U.S. 662 (2009), with
respect to his claim against Disney for violation of 15 U.S.C. § 1681s-2(b). See Akpan, 2010
WL 917886 at *3 (Plaintiff failed to state a claim for relief under the FCRA where he “[did]
not allege that he notified a credit reporting agency of a dispute regarding the accuracy of
information reported to it, nor [did] he assert that Defendant was notified by the consumer
reporting agency of a dispute such that it could have violated its duties pursuant to 15
U.S.C. § 1681[s]-2(b)(1).”). Plaintiff has failed to allege that: (1) Harwood filed a complaint
with a consumer reporting agency; (2) Disney was notified of the dispute by the consumer
reporting agency; and (3) in response, Disney failed to conduct a reasonable investigation.
Therefore, Defendant Disney’s Motion to Dismiss (ECF No. 7) is GRANTED with respect
to Count One. Accordingly, Plaintiff’s Fair Credit Reporting Act claim against Defendant
Disney (Count One) is DISMISSED.
Because Plaintiff’s Fair Credit Reporting Act claim against Defendant Disney is
dismissed, Plaintiff’s common law breach of contract claim against Defendant Disney,
seeking judgment in the amount of $3,000 (Count Two), will also be dismissed. When, as
here, a federal claim is dismissed early in the case, federal courts are inclined to dismiss the
state law claims without prejudice rather than retain supplemental jurisdiction. See Neff v.
Green, No. RDB-15-502, 2015 WL 4724942, at *3 (D. Md. Aug. 7, 2015), appeal dismissed
(Nov. 16, 2015) (citing Carnegie Mellon Univ. v. Cohill, 484 U.S. 343, 350 (1988)). Therefore,
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Defendant Disney’s Motion to Dismiss (ECF No. 7) is GRANTED with respect to Count
Two. Accordingly, Plaintiff’s breach of contract claim against Defendant Disney (Count
Two) is DISMISSED, subject to refiling in state court.4
CONCLUSION
For the reasons stated above, Defendant Disney’s Motion to Dismiss (ECF No. 7) is
GRANTED.
All claims asserted by Plaintiff against Defendant Disney shall be
DISMISSED.
A separate Order follows.
Dated: April 28, 2016
________/s/______________________
Richard D. Bennett
United States District Judge
4 This case will remain open, pending Plaintiff’s response to this Court’s Show Cause Order, dated April 20,
2016 (ECF No. 13). See supra n. 1.
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