Perry v. PNC Bank, N. A., et al
ORDER granting 7 Motion to Dismiss - Signed by District Judge Louise Wood Flanagan on 2/28/2017. (Baker, C.)
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
DAVID T. PERRY,
PNC BANK, N.A. and KELLY
This matter is before the court on defendants’ motion to dismiss. (DE 7). The motion has
been fully briefed, and in this posture issues raised are ripe for ruling. For the reasons that follow,
defendants’ motion is granted.
Plaintiff, proceeding pro se, initiated this action May 7, 2015, in the General Court of Justice
Superior Court Division for Wake County, North Carolina, seeking compensatory and punitive
damages arising from defendants’ alleged fraud and violations of the North Carolina Unfair and
Deceptive Trade Practices Act (“UDTPA”), N.C. Gen. Stat. § 75-1.1, et seq., arising out of a dispute
concerning an unpaid debt appearing on plaintiff’s credit report. Thereafter, defendants removed
the case to this court on the basis of federal question and diversity jurisdiction.
Plaintiff initiated a prior action in state court April 13, 2015, removed to this court
(hereinafter the “2015 action”) against defendants and also against Equifax Information Services
(“Equifax”), LLC, Transunion, LLC, and Experian Information Solutions, Incorporated
(“Experian”), asserting similar claims. In that case, plaintiff asserted 10 counts arising under state
and federal law. Plaintiff voluntarily dismissed Transunion, LLC, before any other motions were
filed. The court then dismissed each count against defendants PNC Bank, N.A. and Kelly Cooke
with prejudice except plaintiff’s count under § 1681s-2(b) of the Fair Credit Reporting Act
(“FCRA”), 15 U.S.C. § 1681s-2(b), which the court dismissed without prejudice based on plaintiff’s
failure to plead a necessary element of a cause of action under that statute. Finally, plaintiff’s case
against Experian and Equifax settled for reasons not disclosed in the record of the 2015 action.
Defendants filed the instant motion November 4, 2016, seeking dismissal on grounds of res
judicata, failure to state a claim, and preemption. In particular, defendants argue plaintiff’s claims
are barred by his failure to assert them in prior litigation, that plaintiff has not pleaded facts alleging
fraud or UDTPA violations, and that the FCRA preempts plaintiff’s claims arising under state law.
Plaintiff opposes the motion on the ground that his prior settlement with Experian and
Equifax constitutes a new factual development permitting plaintiff to overcome dismissal based
upon res judicata. In addition, plaintiff maintains that facts as he pleads them are sufficient to state
a fraud claim and a violation of the UDTPA. Plaintiff’s filings do not address defendants’
arguments concerning preemption.
STATEMENT OF FACTS
The facts alleged in the complaint may be summarized as follows. On or about January
2012, an unknown individual stole plaintiff’s identity and used his personal information to open
accounts at PNC Bank. A few months later, in mid to late 2012, these then delinquent accounts
began appearing on plaintiff’s credit reports, and he began the process of disputing the accuracy of
the entries with the consumer credit reporting agencies, including defendants Equifax and Experian.
In 2013 or 2014, plaintiff contends he again disputed the information pertaining to the accounts by
contacting defendant PNC directly by phone and mail.
In February 2015, plaintiff spoke with defendant Cooke, in her capacity as fraud investigator
at PNC, at which time, plaintiff provided defendants with a letter he received from defendant PNC
about a personal credit application containing missing information. Defendant Cooke then provided
plaintiff with the documentation she had on file about him, including a personal credit application.
Plaintiff informed defendants that the signature on the documents was not his, that the documents
lacked his social security number, and that they contained an inaccuracy concerning plaintiff’s place
of employment. In response, defendant Cooke mailed plaintiff a letter, dated February 9, 2015,
suggesting plaintiff file a police report if he believed he was the victim of identity theft, and
detailing the information required by defendants in order to investigate plaintiff’s claim. Plaintiff
filed a police report with the Northampton County Sheriff’s Department March 18, 2015.
As noted above, plaintiff brought the 2015 action, which procedural history plaintiff asserts
as pertinent fact giving rise to the present action. As part of the settlement in the 2015 action,
Experian and Equifax allegedly removed from plaintiff’s credit report information pertaining to the
delinquent accounts in issue. This action followed.
To determine whether an earlier federal judgment bars a claim asserted in a later action on
the basis of res judicata, the court considers whether:
1) the prior judgment was final and on the merits, and rendered by a court of
competent jurisdiction in accordance with the requirements of due process; 2) the
parties are identical, or in privity, in the two actions; and 3) the claim in the second
matter is based upon the same cause of action involved in the earlier proceeding.
Grausz v. Englander, 321 F.3d 467, 472 (4th Cir. 2003).
Generally, “claims are part of the same cause of action when they arise out of the same
transaction or series of transactions, or the same core of operative facts.” Id. at 473. Res judicata
bars available claims “regardless of whether they were asserted or determined in the prior
proceeding.” Brown v. Felsen, 442 U.S. 127, 131 (1979). This includes “all grounds for, or
defenses to, recovery that were previously available to the parties, regardless of whether they were
asserted.” Meekins v. United Transp. Union, 946 F.2d 1054, 1057 (4th Cir. 1991). Furthermore,
“[f]or purposes of [res judicata], it is not necessary to ask if the plaintiff knew of his present claim
at the time of the former judgment, for it is the existence of the present claim, not party awareness
of it, that controls.” In re Varat Enters., Inc., 81 F.3d 1310, 1316 (4th Cir. 1996) [“Varat”].
Plaintiff’s claims in this matter are res judicata barred; therefore, the action must be
dismissed. First, the court’s dismissal of the 2015 action constituted a final judgment on the merits
except with respect to the sole claim dismissed without prejudice, see Mendez v. Elliot, 45 F.3d 75,
78 (4th Cir. 1995) (stating “[t]he ‘without prejudice’ condition permits a plaintiff to refile the
complaint as if it had never been filed”), and plaintiff does not assert his remaining available claim.
Second, the parties to both actions clearly are identical.
Finally, plaintiff’s claims in this matter rest upon the same factual allegations constituting
the basis for the 2015 action. Therefore, both actions arise out of the same transaction or series of
transactions [and] the same core of operative facts.” See Grausz 321 F.3d at 472. Additionally, no
facts asserted in the complaint indicate that defendants now may be subject to any liability that did
not exist prior to the 2015 action. That is, if defendants’ alleged failure to cooperate in plaintiff’s
attempt to expunge certain false information from his credit report constitutes fraud or a UDTPA
violation now, (see compl., DE 1-1, at 9–10), such actions were equally unlawful before.
Accordingly, plaintiff’s claims arising from the facts summarized above are barred from this and
future litigation. See Varat 81 F.3d at 1316.
In support of a contrary argument, plaintiff contends, first, that the court lacked personal
jurisdiction to render its decision in the 2015 action because plaintiff did not consent to removal
from state court. However, this argument fails because a plaintiff’s consent is not required to
remove an action to federal court. See 28 U.S.C. §§ 1441 & 1446.
Second, plaintiff contends that his settlement with other parties in the 2015 action constitutes
a new fact giving rise to liability that did not exist before. Plaintiff asserts that other parties’
willingness to settle “proves that [defendants] knew or should have known that prime [sic] facie, a
valid contract was not formed and could not be enforceable and therefore not authentic.” (DE 23,
¶ 5, at 2) (emphasis omitted). This argument is unavailing. If plaintiff is entitled to relief based on
fraud or a UDTPA violation, that entitlement necessarily arises from facts related to defendants’
handling of his credit dispute. Whether another party settled the 2015 action has no bearing upon
the pertinent facts. Therefore, if plaintiff now has a cause of action for fraud or a violation of the
UDTPA, that same cause of action was available to be asserted in the 2015 action. Accordingly,
plaintiff’s fraud and UDTPA claims are res judicata barred and must be dismissed.
Because defendants are entitled to dismissal on the basis of res judicata, the court does not
reach defendants’ contentions regarding preemption and failure to state a claim.
Based upon the foregoing, defendants’ motion to dismiss is GRANTED, and the case is
DISMISSED WITH PREJUDICE. The clerk of court is DIRECTED to close this case.
SO ORDERED, this the 28th day of February, 2017.
LOUISE W. FLANAGAN
United States District Judge
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?