DIBUONO v. EXPERIAN INFORMATION SOLUTIONS, INC. et al

Filing 16

OPINION. Signed by Chief Judge Jose L. Linares on 10/10/2017. (JB, )

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

Civil Action No.: 17-5379 (ILL)

EDWARD DI BUONO, JR.,

OPINION

Plaintiff,
v.
EXPERIAN TNFORMATION SOLUTIONS,
[NC., AND EQUIFAX INFORMATION
SERVICES LLC,
Defendants.

LINARES, District Judge.

This matter comes before the Court by way of Defendants Experian Information Solutions,
Inc. and Equifax Information Services, LLC’s Motion to Dismiss pursuant to Rule 12(b)(6) of the
Federal Rules of Civil Procedure. (ECF No. 12). Plaintiff has submitted an opposition, (ECF No.
14), and Defendants have submitted a reply, (ECF No. 15). The Court decides this matter without
oral argument pursuant to Rule 78 of the Federal Rules of Civil Procedure. F or the reasons set
forth below, the Court denies Defendants’ Motion to Dismiss.
I.

BACKGROUND1

Plaintiff filed this action alleging that Defendants have violated the Fair Credit Reporting
Act (“fCRA”).

(See general/p ECF No. 1 (“Cornpl.”)).

Specifically, Plaintiff alleges that

Defendants Experian Information Solutions and Equifax Infonnation Services, both of which are

1

This background is derived fi-orn Plaintiff’s Complaint, which the Court must accept as true at
this stage of the proceedings. See Aiston v. Countrywide Fin. Corp., 585 F.3d 753, 758 (3d
Cir. 2009).

“consumer reporting agencies” under 15 U.S.C.

§ 168 la(b) and (fl, issued inaccurate information

concerning the status of Plaintiffs Social Security Administration (“SSA”) payments in false and
misleading credit information and consumer reports. (Compi.

¶JJ 8—9). Plaintiff claims that he

notified Defendants of the inaccuracies in their reports, and that Defendants took no steps to correct
the information, violating 15 U.S.C.

§ 168 le(b), 1(a), and c(a)(5). (Compl. ¶J 9—10, 24). finally,

Plaintiff alleges that Defendants’ failure to amend the errors in their reports resulted in the denial
of loans and other extensions of credit to Plaintiff. (Compi. ¶Jl4—l6). Accordingly, Plaintiff
brought this action under the fCRA seeking damages.
II.

LEGAL STANDARD

To withstand a motion to dismiss, “a complaint must contain sufficient factual matter,
accepted as true, to ‘state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (quoting Bell At!. Coip. v. Tvornbl, 550 U.S. 544, 570 (2007)). “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.” Id., at 678. “The
plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer
possibility that a defendant has acted unlawfully.” Id. (quoting Twombly, 550 U.S. at 556).
To determine the sufficiency of a complaint under Twomblv and Iqbal in the Third Circuit,
the Court must take three steps. “First, it must ‘tak[e] note of the elements a plaintiff must plead
to state a claim.’ Second, it should identify allegations that, ‘because they are no more than
conclusions, are not entitled to the assumption of truth.’ finally, ‘[w]hen there are well-pleaded
factual allegations, a court should assume their veracity and then determine whether they plausibly
give rise to an entitlement for relief.” See Connellv v. Lane Constr. Corp., $09 F.3d 780, 787 (3d

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Cir. 2016) (quoting Iqbal, 556 U.S. at 675, 679) (citations omitted). “In deciding a Rule 12(b)(6)
motion, a court must consider only the complaint, exhibits attached to the complaint, matters of
public record, as well as undisputedly authentic documents if the complainant’s claims are based

upon these documents.” Mayer v. Betichick, 605 f.3d 223, 230 (3d Cir. 2010).
III.

ANALYSIS

Defendants seek dismissal of Plaintiffs claim, arguing that it is a collateral attack on a
determination of the SSA and aninaround of SSA regulations. (See general/tv ECF No. 12). This
Court disagrees.
The purpose of the FCRA is to protect consumers from the dissemination of inaccurate
information and to establish credit reporting practices that use accurate and current information.
StmmsFams v. C’ount.’ywide fin. Coip., 652 F.3d 355, 357 (3d Cir. 2011). When preparing a

consumer report, a consumer reporting agency must “follow reasonable procedures to assure
maximum possible accuracy of the information concerning the individual about whom the report
relates,” and it must “conduct a reasonable reinvestigation” into the accuracy of the information in
the consumer report if a consumer disputes the veracity of the information in the report and notifies
the credit reporting agency of his or her dispute. 15 U.S.C.
reporting agency violates

§ 1681e(b), i(a)(1)(A). A consumer

§ 16$ le(b) when: “(1) inaccurate infonuation was included in a

consumer’s credit report; (2) the inaccuracy was due to the defendant’s failure to follow reasonable
procedures to assure maximum possible accuracy; (3) the consumer suffered injury; and (4) the
consumer’s injury was caused by the inclusion of the inaccurate entry.” Cortez v. Trans Union,
LLC, 617 F.3d 68$, 70$ (3d Cir. 2010) (quoting Phi/bin

i’.

Trans Union Coip., 101 F.3d 957, 963

(3d Cir. 1996)). Furthermore, once a consumer disputes specific information with the consumer

.3

reporting agency, the agency bears the burden of reinvestigation under

§

1681 i(a) and may be

required to “verify the accuracy of its initial source of infonriation,” including possibly going
beyond the original source of information. Cushman v. Trans Union Coip., 115 F.3d 220, 224—
26 (3d Cir. 1997).
Plaintiffs complaint alleges well-pleaded facts that could plausibly give rise to relief under
15 U.S.C.

§

1681e(b) and i(a). Connelty, 809 F.3d at 787. With respect to

§

168le(b), Plaintiff

has alleged that: (1) the information related to his payment status on his SSA account in the
consumer report was inaccurate, (Compi.

¶J 7—9);

(2) he notified the consumer reporting injuries

of the inaccurate information and that no steps were taken, (Compi.

¶

10); (3) he was denied

“various loans and extensions of consumer credit on different occasions,” (Cornpl.

¶

14); and (4)

a substantial reason for those denials was the inclusion of the inaccurate information in the credit
reports, (Compi.

¶ 15).

As for

§

1681i(a), Plaintiff has alleged that the Defendants did not engage

in any reinvestigation once notified by Plaintiff of the inaccuracy of the reports. (Cornpl. ¶11).

Defendants argue that Plaintiff is actually disputing the delinquent status the SSA attributed
to his account and that Plaintiff cannot collaterally attack that determination through the FCRA.
(ECf No. 12, at 1). However, it is clear from Plaintiffs dispute of the SSA account, which
Defendants themselves argue should be incorporated by reference into the pleadings, (ECF No.
12, at 3), that Plaintiff had established a payment plan with the $SA to pay back the initial
overpayment, and that Plaintiff was current on those payments. (ECf Nos. 12-1, 12-2). Even
assuming that Plaintiff was challenging the validity of his debt with the SSA, the FCRA does not
require the consumer to resolve the dispute with the creditor. Cushman, 115 F.3d at 225.

4

In their reply papers, Defendants argue that an installment plan to repay an SSA

overpayment benefit is somehow different than other installment repayment plans, and as such,
Plaintiff has failed to state a claim. (ECF No. 15, at 4). This argument conflicts with the very
regulations Defendants cite in support of their argument.

Title 20 of the Code of Federal

Regulations explicitly mentions the option of repaying an SSA overpayment by installment in
several sections. See 20 C.F.R.

§ 404.502a(d) (noting that in seeking return of an overpayment,

the notice the SSA sends to the recipient of the overpayment includes information about
“installment payments when refund is requested”); 20 C.F.R.

§ 404.502(c)(1) (permitting recovery

of an overpayment through the withholding of an amount from another monthly benefit); 20 C.F.R.

§ 404.527(b)(2) (noting that an overpayment is only considered “unrecoverable,” when the SSA
has not entered into an installment payment arrangement with the recipient of the benefits, or if
there is an installment arrangement, when those payments are overdue for two consecutive
months).2 Defendants also argue that installment payments in a “government collection” are by
default due and owing. (ECF No. 15, at 3—4). This is

not

the case. The Third Circuit has held

that a plaintiff’s property tax payments to the government were “arguably not delinquent because
she had an agreement with the City of Philadelphia to pay her taxes in monthly installments.”
Fuges v. Sw. Fin. Servs., Ltd., 707 F.3d 241, 244 (3d Cir. 2012).
Plaintiff has laid out facts in his complaint that could plausibly give rise to relief under 15
U.S.C.

§ 1681e(b) and i(a) and Defendants’ arguments do not foreclose the possibility of

Plaintiffs recovery.

2

Plaintiffs’ dispute of his SSA account, which Defendants admit is incorporated by reference into the pleadings,
shows a statement date ofMay 9, 2017 and a payment as recent as April 12, 2017. (See ECF No. 12-1, at 6).

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CONCLUSION
For the aforementioned reasons, Defendants’ Motion to Dismiss is hereby denied. An
appropriate Order accompanies this Opinion.

DATED: OctoberO17
10$ L. LINARES
C 94udge, United States District Court

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