RADLEY v. EXPERIAN INFORMATION SOLUTIONS, INC, et al

Filing 34

MEMORANDUM OPINION. Signed by Judge Jerome B. Simandle on 3/26/2018. (dmr)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

MARINA RADLEY,
Plaintiff,

HONORABLE JEROME B. SIMANDLE

v.
EXPERIAN INFORMATION
SOLUTIONS, INC.; EQUIFAX
INFORMATION SERVICES LLC; AND
ROUNDPOINT MORTGAGE COMPANY,

Civil Action
No. 1:17-CV-02755 (JBS/JS)

MEMORANDUM OPINION

Defendants.

SIMANDLE, District Judge:
Plaintiff Marina Radley (“Plaintiff”) brings this action
against RoundPoint Mortgage Servicing Corporation (“Defendant
RoundPoint” or “RoundPoint”), as well as credit reporting
agencies Experian Information Solutions, Inc. (“Experian”) and
Equifax Information Services, LLC (“Defendant Equifax” or
“Equifax”) (collectively, “the CRAs”) for violations of the Fair
Credit Reporting Act, 15 U.S.C. § 1681 et seq. (“FCRA”) and the
Fair Debt Collection Practices Act § 1692 et seq. [Docket Item
1, Compl., ¶ 1.]
Specifically, Plaintiff alleges that Defendant RoundPoint
violated the FCRA by failing to conduct reasonable
investigations of the allegedly inaccurate information that
Plaintiff disputed, and by willfully and negligently failing to
comply with the requirements the FCRA imposes on furnishers

pursuant to 15 U.S.C § 1681s-2(b). Plaintiff alleges Defendant
RoundPoint is therefore liable under Sections 1681n and 1681o of
the FCRA (Count Two, the only claim asserted against
RoundPoint). Before the Court is RoundPoint’s motion to dismiss
Count Two of Plaintiff’s complaint under Rule 12(b)(6), Fed. R.
Civ. P. [Docket Item 17.]
The principal issue to be decided is whether a consumer
seeking to recover under the FCRA’s private right of action
under 15 U.S.C. § 1681s-2(b) against a person furnishing
inaccurate information must plead grounds to believe that a CRA
informed the furnishing party of the consumer’s dispute as
required by 15 U.S.C. § 1681i(a)(2).
For the reasons that follow, RoundPoint’s motion to dismiss
Count Two will be granted without prejudice. The Court finds as
follows:
1. Factual and Procedural Background. Plaintiff, a New
Jersey resident, filed a complaint with this Court on April 21,
2017 alleging that RoundPoint and the CRAs were reporting
inaccurate information relating to Plaintiff and her credit
history “from at least November 2013.” [Docket Item 1, ¶¶ 7-8.]
Plaintiff contends this inaccurate information includes a
mortgage with Defendant RoundPoint that is her ex-husband’s
responsibility, and “consists of accounts and/or tradelines that
do not belong to the Plaintiff.” (Id. ¶¶ 9-10.)
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Plaintiff

further alleges the inaccurate information negatively reflects
upon Plaintiff’s repayment history, financial responsibility as
a debtor, and creditworthiness. (Id. ¶ 10.) She asserts that she
disputed this information with all named Defendants but that
none of the Defendants engaged in any reasonable investigation
or any investigation at all. (Id. ¶¶ 12-13.) As a result,
Plaintiff claims actual damages. (Id. ¶¶ 15-17.)
2. In Count Two of Plaintiff’s complaint,1 she alleges
Defendant RoundPoint violated FCRA at §§ 1681n and 1681o by
engaging in the following conduct:
a. willfully and negligently failing to conduct a
reasonable investigation of the inaccurate information
that Plaintiff disputed;
b. willfully and negligently failing to review all relevant
information
concerning
Plaintiff’s
inaccurately
reported tradelines;
c. willfully and negligently failing to report the results
of investigations to the relevant consumer reporting
agencies;
d. willfully and negligently failing to report the accurate
status of the inaccurate information to all credit
reporting agencies;
e. willfully and negligently failing to provide any and all
credit reporting agencies with the factual information
and evidence that Plaintiff provided to [Defendant];
f. willfully and negligently continuing to furnish and
disseminate inaccurate, unlawful, and derogatory credit,
account and other information concerning the Plaintiff
to credit reporting agencies and other entities; and
g. willfully and negligently failing to comply with the
requirements imposed on furnishers of information
pursuant to 15 U.S.C. § 16[8]1s-2(b).
1

Plaintiff’s complaint contains two counts, the first of which
alleges the CRAs’ violations of the FCRA. Count Two is the only
count pleaded against Defendant RoundPoint. [Docket Item 1
¶¶ 20-28.]
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[Docket Item 1 ¶ 29.]
3. Subsequently, Defendant RoundPoint filed a Motion to
Dismiss pursuant to Fed. R. Civ. P. 12(b)(6) [Docket Item 17].
4. Standard of Review. Pursuant to Rule 8(a)(2), Fed. R.
Civ. P., a complaint need only contain “a short and plain
statement of the claim showing that the pleader is entitled to
relief.” Specific facts are not required, and “the statement
need only ‘give the defendant fair notice of what the . . .
claim is and the grounds upon which it rests.’” Erickson v.
Pardus, 551 U.S. 89, 93 (2007) (citations omitted).

While a

complaint is not required to contain detailed factual
allegations, the plaintiff must provide the “grounds” of his
“entitle[ment] to relief”, which requires more than mere labels
and conclusions. Bell Atlantic Corp. v. Twombly, 550 U.S. 544,
555 (2007). When addressing a Rule 12(c) motion, the court
applies “the same standards as under Rule 12(b)(6).” Turbe v.
Gov’t of V.I., 938 F.2d 427, 428 (3d Cir. 1991). A motion to
dismiss under Rule 12(b)(6), Fed. R. Civ. P., may be granted
only if, accepting all well-pleaded allegations in the complaint
as true and viewing them in the light most favorable to the
plaintiff, a court concludes that the plaintiff failed to set
forth fair notice of what the claim is and the grounds upon
which it rests. Id.

A complaint will survive a motion to

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dismiss if it contains sufficient factual matter to “state a
claim to relief that is plausible on its face.” Ashcroft v.
Iqbal, 556 U.S. 662, 663 (2009).

Although a court must accept

as true all factual allegations in a complaint, that tenet is
“inapplicable to legal conclusions,” and “[a] pleading that
offers labels and conclusions or a formulaic recitation of the
elements of a cause of action will not do.” Id. at 678.
5. Discussion. Defendant RoundPoint argues, first, that
Plaintiff has failed to plead grounds supportive of an FCRA
claim against it. [Docket Item 17-4 at 14-16.] The Court agrees.
6. The FCRA delineates certain legal responsibilities of
persons who furnish information to credit reporting agencies.
See 15 U.S.C. § 1681s-2.2 Under 15 U.S.C. § 1681s-2(a), the FCRA
requires furnishers to provide accurate information. Section
1681s-2(b) further imposes certain duties on furnishers, upon
notice of a dispute of the accuracy of reported information.
Accordingly, the FCRA imposes civil liability on furnishers for
violations of the Act under §§ 1681n and 1681o.
7. Although the FCRA permits a citizen to bring private
action for violations under 15 U.S.C. § 1681s–2(b), “this cause
of action is not without limitations.” SimmsParris v.

2

The parties do not dispute that for purposes of the FCRA,
Defendant is a “person” who furnishes information to credit
reporting agencies. See 15 U.S.C. § 1681a(b).
5

Countrywide Fin. Corp., 652 F.3d 355, 358 (3d Cir. 2011). This
subsection, under which Plaintiff brings Count Two, imposes
duties on furnishers that are “implicated only [a]fter 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.” Id. (quoting 15 U.S.C. § 1681s–2(b)(1)) (internal
quotations omitted). Under § 1681i(a)(2), the credit reporting
agency must give notice to the furnisher about a consumer’s
dispute; that notice “cannot come directly from the consumer.”
SimmsParris, 652 F.3d at 358. See also Gorman v. Wolpoff &
Abramson, LLP, 584 F.3d 1147, 1154 (9th Cir. 2009) (“notice of a
dispute received directly from the consumer does not trigger
furnishers' duties under subsection (b)”); Grossman v. Barclays
Bank Delaware, No.12-6238, 2014 WL 647970, *8 (D.N.J. Feb. 19,
2014) (“In order to establish a violation of § 1681s-2(b), a
plaintiff must plead that (1) [he] sent notice of disputed
information to a consumer reporting agency, (2) the consumer
reporting agency then notified the defendant furnisher of the
dispute, and (3) the furnisher failed to investigate and modify
the inaccurate information”) (internal quotations omitted).
8. While Plaintiff contends that she disputed what she
alleges is inaccurate information “with Defendants,” that is all
she includes in her complaint about Defendant RoundPoint’s
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notice. [Docket Item 1 ¶ 12.] She does not factually allege when
she disputed this information to the Defendant RoundPoint or the
CRAs. Importantly, the complaint does not contain any factual
allegations suggesting the CRAs provided proper notice to
Defendant RoundPoint that Plaintiff disputed the information
RoundPoint supplied to them. Additionally, the Plaintiff did not
include in her allegations whether any credit reporting agency,
to which Defendant RoundPoint had provided information to as a
furnisher, notified Defendant RoundPoint about the dispute.
9. Furthermore, the complaint does not plead that the
inaccurate information continued to be reported by Defendant
after any kind of notification. A complaint is sufficient if it
shows that Plaintiff is entitled to any relief, but it must set
forth fair notice of the grounds upon which it rests. See
Neitzke v. Williams, 490 U.S. 319 (1989); Twombly, 550 U.S. at
544. Despite Plaintiff’s argument that she pleaded facts
establishing all elements of the furnisher’s liability, here,
the essential element of notification from the CRA to the
furnisher is missing, because only after credit reporting agency
notification “can the furnisher face any liability to a private
individual.” SimmsParris, 652 F.3d at 359. Thus, the complaint
is deficient as to RoundPoint because it does not allege that a
CRA provided the requisite notice to RoundPoint. Therefore,
Plaintiff’s complaint states only conclusions that do not state
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a claim for Defendant’s liability under the FCRA. For this
reason, the pleadings are insufficient as to RoundPoint on this
ground. See Iqbal, 556 U.S. at 663.
10. Although the complaint as presently pled contains
inadequate grounds for relief against RoundPoint, it may be
possible for Plaintiff to cure the deficiencies noted above
through an amended pleading. The Court will not rule out the
possibility of such a cure, and therefore Count Two will be
dismissed without prejudice to Plaintiff’s right to promptly
seek leave to amend as against Defendant RoundPoint.
11. RoundPoint’s Argument that Plaintiff is Personally
Responsible for Repaying the Mortgage as a Matter of Law.
Defendant RoundPoint also argues that Plaintiff’s claim should
be dismissed because Plaintiff is in fact personally responsible
for repaying the loan with Defendant RoundPoint as a matter of
law. Defendant assets that because Plaintiff’s divorce does not
affect her contractual responsibility for the loan, that
Defendant’s reporting of any failure to pay the loan was in fact
accurate. [Docket Item 17-4 at 9-14.] In contrast, Plaintiff
alleges that “Defendant misunderstands the context of ‘accuracy’
in connection with reporting credit information,’ and failed to
report the account as disputed. [Docket Item 22 at 11-20.] The
Court declines to address the issue at this time, having
dismissed Count Two as against Defendant RoundPoint for failure
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to state a claim under Rule 12(b)(6)3; any proposed Amended
Complaint by Plaintiff should also seek to better address this
secondary issue raised by Defendant, upon which the Court takes
no present position.
12. Conclusion. For all of these reasons, Defendant
RoundPoint’s Motion to Dismiss will be granted. Count Two
against Defendant RoundPoint shall be dismissed without
prejudice. Plaintiff may file a motion for leave to file an
Amended Complaint curing the defect or defects noted herein
within fourteen (14) days from entry of the accompanying Order.
An accompanying Order will be entered.

March 26, 2018
Date

s/ Jerome B. Simandle
JEROME B. SIMANDLE
U.S. District Judge

3

Further, Plaintiff asserts that this aspect of the motion is a
premature motion for summary judgment since RoundPoint refers to
matters outside the pleadings as to which Plaintiff seeks the
ability to conduct discovery, citing Rule 56(d), Fed. R. Civ. P.
[Pl. Opp. Br. at 1], but Plaintiff fails to submit a Rule 56(d)
affidavit supporting this position. The Court will not consider
this unperfected Rule 56(d) argument given dismissal of Count
Two on alternate grounds, supra.
9