Powers v. Selco Community Credit Union et al

Filing 43

ORDER: Because genuine questions of material fact remain, Defendant's Motion for Partial Summary Judgment 28 and Plaintiff's Motion for Partial Summary Judgment 30 are denied. Signed on 1/11/2016 by Judge Michael J. McShane. (cp)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
DIANE POWERS,
Plaintiff,

Case No. 6:15-cv-00292-MC
OPINION AND ORDER

v.

SELCON COMMUNITY CREDIT
UNION & TRANSUNION LLC,
Defendants.
_____________________________
MCSHANE, Judge:
Plaintiff Diane Powers alleges defendant SELCO COMMUNITY CREDIT UNION
(SELCO) violated the Fair Credit Reporting Act (FCRA) by failing to conduct a reasonable
investigation of a disputed debt. The parties filed cross motions for summary judgment. See ECF
Nos. 28, 30. Because the reasonableness of the investigation remains a question of fact, the
motions are DENIED.
BACKGROUND
Most of the facts are not in dispute. The parties agree that Powers owed SELCO a debt
as of August 31, 2014. The parties agree that SELCO accurately reported that debt to
1 – OPINION AND ORDER

TransUnion, a credit reporting agency (CRA) on August 31, 2014. 1 The parties agree Powers
paid the debt and closed the account on September 3, 2014. The parties agree that on September
6, Powers disputed the debt to TransUnion.
CRAs provide furnishers of information (such as SELCO) notice of consumer disputes
through Automated Consumer Dispute Verifications (ACDVs). ACDVs are sent and responded
to through the e-OSCAR system. 2 On September 6, 2014, TransUnion sent SELCO an ACDV
regarding Powers’s dispute. Furnishers must provide timely responses to ACDVs. The parties
agree SELCO timely responded to the four ACDVs at issue.
ACDVs provide various boxes or fields such as “Date Opened,” “Amount Due,” “Date of
Account Information,” and “Date Closed.” Miller Decl.; ECF No. 29, 3 ¶ 8. A CRA submitting
an ACDV typically submits a dispute code. Here, TransUnion entered code 109, stating,
“Disputes Current Balance – Verify Original Loan Amount, Scheduled Monthly Payment
Amount, Actual Payment Amount, Amount Past Due, Current Balance, and Original Charge-Off
Amount.” Miller Decl.; ECF No. 29-1, 1. Although Powers disputed the fact that the debt
remained on her credit report after September 3, TransUnion entered August 31, 2014 as the
“Date of Account Information.” Britt Miller, a Lending Support Specialist at SELCO who
responded to the relevant ACDVs, submitted a declaration stating:
When SELCO received the disputes on Ms. Powers’ account, TransUnion had
these fields filled out with the information that is being disputed. On the printed
ACDV forms, the box below each of these field titles is the information provided
by TransUnion. The empty boxes below TransUnion’s information is where
SELCO would list any updates or changes to the information.
Miller Decl., ¶ 8.
1
2

Powers brought the same claims against TransUnion, but settled those claims.
The CRAs created the e-OSCAR system.

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Miller states that for every ACDV SELCO receives, it verifies the accuracy of the
information “as of the date of account information on the dispute. Miller Decl., ¶ 4. According to
Miller:
When e-OSCAR trained me, and all SELCO employees who respond to ACDVs,
it was made clear that we were to verify the account information as of the date in
the “Date of Account Information” field. The date we received or responded to
the dispute has no bearing on the date of account information which we are
verifying. A copy of the training manual e-OSCAR provided in its most recent
training attended by a SELCO employee is attached hereto as Exhibit “7” and by
this reference incorporated herein. In that manual, the purpose and use of the
“Date of Account Information” field is clearly explained as the date which we are
being request[ed] to verify the information as of in order to respond to the credit
reporting agency.
Miller Decl., ¶ 9.
In the “Description and Process Tips” for the “Date of Account Information” field, the eOSCAR manual states:
The date entered in this field tells the CRA that “as of” X date, the consumer’s
account information is in the status specified in the ACDV. All account
information, such as Account Status and Current Balance, must be reported as
of the date in this field.
Miller Decl. Ex. 7, 24.
Because the ACDV listed August 31, 2014 as the “Date of Account Information,” and
because Powers owed the debt as of August 31, 2014, Miller verified the information contained
in the ACDV. TransUnion receive SELCO’s response on September 16, 2014.
That same day, Powers again disputed the debt to TransUnion and TransUnion sent a
second ACDV to SELCO. This ACDV again listed August 31, 2014 as the “Date of Account
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Information.” Miller Decl., Ex. 3. The ACDV contained the identical dispute code from the first
ACDV. It also contained a second dispute code stating “Claims company will change. Verify all
account information.” The second ACDV also contained “FCRA Relevant Information” stating
“Consumer plans to submit relevant doc to support their claim.. Paid in full on 09/03/2014.
$228.81.. Balance should be zero.. account closed on 09/03/2014.” Id.
On October 2, 2014, before SELCO responded to the September 16 ACDV, SELCO
provided its monthly report to the CRAs. This report accurately alerted TransUnion to the fact
that Powers closed her account with a balance of $0. Wagner Decl., ¶ 6. TransUnion updated the
report accordingly.
On October 4, SELCO verified that the information in the second ACDV was correct. As
noted, SELCO states its response was limited, in accordance with the e-OSCAR manual and
other training provided by e-OSCAR, to verifying the information as of August 31, 2014, the
“Date of Account Information” provided by TransUnion. Don Wagner, an Investigator III,
Litigation Support with TransUnion, contradicts Miller’s declaration. Wagner states SELCO’s
October 4 response to the second ACDV “verf[ied] that all the Account information as reflected
on the September 16, 2014 ACDV, including a $202 balance, was accurate information as of
October 4, 2014. Consequently, Trans Union updated its reporting of the Account to include the
$202 balance as directed by Selco in its ACDV response.” Miller Decl., Ex. 1, 2 ¶ 7.
On October 30, 2014, Powers disputed the debt again. TransUnion sent similar ACDV to
SELCO. As that ACDV again listed August 31 as the “Date of Account Information,” SELCO
verified the information contained in the ACDV.
On March 11, 2015, TransUnion sent a fourth ACDV to SELCO. Like the others, it
contained the August 31 date. Miller states that she now understood the misunderstanding:
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In March, 2015, when I received the fourth ACDV, I had seen this dispute
repeatedly. I suspected the account had never been updated properly due to
Plaintiff’s continued disputes. I again stated that SELCO’s reporting was correct
as of August 31, 2014. However, in order to attempt to prevent the repeated
requests for verification as of August 31, 2014, I voluntarily added a new line of
information that as of September 3, 2014, the account was closed and with a
balance of $0, in hopes TransUnion would update their records accordingly.
Miller Decl., ¶ 12.
TransUnion then updated Powers’s report to show that as of September 3, 2014, the
account was closed with a balance of $0.
STANDARDS
The court must grant summary judgment if there is no genuine issue of material fact and
the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). An issue is
“genuine” if a reasonable jury could return a verdict in favor of the non-moving party. Rivera v.
Phillip Morris, Inc., 395 F.3d 1142, 1146 (9th Cir. 2005) (citing Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 248 (1986)). A fact is “material” if it could affect the outcome of the case. Id. The
court reviews evidence and draws inferences in the light most favorable to the non-moving party.
Miller v. Glenn Miller Prods., Inc., 454 F.3d 975, 988 (9th Cir. 2006) (quoting Hunt v.
Cromartie, 526 U.S. 541, 552 (1999)). When the moving party has met its burden, the nonmoving party must present “specific facts showing that there is a genuine issue for trial.”
Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (quoting Fed. R. Civ. P.
56(e)).
DISCUSSION
Congress enacted the FCRA, 15 U.S.C. §§ 1681-1681x, “to ensure fair and accurate
credit reporting, promote efficiency in the banking system, and protect consumer privacy.”
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Baldin v. Wells Fargo Bank, N.A., 2013 WL 6388499 at *6 (D. Or. 2013) (quoting Safeco Ins.
Co. of Am. V. Burr, 551 U.S. 47, 52 (2007)). CRAs assemble credit information on consumers
and provide consumer credit reports to third parties. § 1681a(f). The FCRA places different
obligations on “consumer reporting agencies” and “furnishers” of credit information.
The obligations of “furnishers” are found in § 1681s-2. § This case concerns the
obligations contained in § 1681s-2(b), which create a private right of action for a consumer
against a furnisher. Gorman v. Wolpoff, 585 F.3d 1147, 1154 (9th Cir. 2009).
The parties agree that a plaintiff bringing a claim under § 1681s-2(b)(1)(A) must prove:
(1) the furnisher received notice of the dispute from the CRA; (2) the furnisher failed to perform
a reasonable investigation of the dispute; (3) the failure was willful or negligent; and (4) the
plaintiff was harmed. Baldin, 2013 WL 6388499 at *7. The only dispute is whether SELCO’s
investigation was reasonable.
The Ninth Circuit confirmed that the notice to the furnisher from the CRA triggers the
obligation to conduct a reasonable investigation under § 2(b)(1)(A). Gorman, 584 F.3d at 1157.
The Ninth Circuit noted:
Such notice must include “all relevant information regarding the dispute that the
[CRA] has received from the consumer.” § 1681i(a)(2)(A). It is from this notice
that the furnisher learns the nature of the consumer’s challenge to the reported
debt, and it is the receipt of this notice that gives rise to the furnisher’s obligation
to conduct a reasonable investigation. The pertinent question is thus whether the
furnisher’s procedures were reasonable in light of what it learned about the nature
of the dispute from the description in the CRA’s notice of dispute.
Id.
As discussed, the parties filed cross motions for summary judgment. Powers argues the eOSCAR manual is inadmissible. First, Powers argues the manual is not properly authenticated.
6 – OPINION AND ORDER

This argument is meritless. Miller’s declaration states the manual was provided by e-OSCAR
during training sessions provided by e-OSCAR. Authentication requires nothing more. Of course
this does not prevent Powers from making her own arguments related to the manual, or even
from calling witness from e-OSCAR to refute Miller’s declaration or testimony.
In the alternative, Powers argues the manual should be stricken because SELCO never
provided the manual during discovery. Powers requests re-opening discovery to allow it to
investigate the manual. Powers’s objections are denied. Miller was deposed over six months ago.
During that deposition, it became clear that SELCO’s defense in this matter would rest on
training provided by e-OSCAR regarding the “Date of Account Information.” Additionally,
SELCO argues it was not until receiving Wagner’s declaration immediately before the discovery
cutoff that it became aware that the August 31 date was at issue. The parties will of course be
able to argue and present evidence about the meaning of the e-OSCAR manual and any other
training provided by e-OSCAR.
Turning to Powers’s motion for summary judgment, Powers argues SELCO’s
investigation was clearly unreasonable and the only dispute is damages. Powers ignores Miller’s
declaration stating TransUnion filled in the “Date of Account Information” and, under the eOSCAR system, furnishers only review the information furnished as of the “Date of Account
Information.” A jury could certainly take that information, along with the undisputed fact that
Powers owed the debt on August 31, 2014, and conclude SELCO’s investigation was reasonable.
In other words, a jury could conclude that any error here was TransUnion’s, not SELCO’s.
Similarly, SELCO argues there is no genuine issue of material fact that its investigation,
based on the information provided by TransUnion, was reasonable. In addition to making a
reasonable inquiry into any consumer dispute, the FCRA requires furnishers to report any
7 – OPINION AND ORDER

incomplete or inaccurate information found during the inquiry. § 1861s-2(b)(1)(D). As discussed
in Gorman, the “pertinent question is thus whether the furnisher’s procedures were reasonable in
light of what it learned about the nature of the dispute from the description in the CRA’s notice
of dispute.” 584 F.3d at 1157. Although SELCO relies on the “Date of Account Information”
field, the ACDVs contained other information related to the dispute.
For example, the September 16 ACDV included information in the “FRCR Relevant
Information” field. There, TransUnion alerted SELCO that “Consumer plans to submit relevant
doc to support their claim.. Paid in full on 09/03/2014. $228.81 Balance should be zero.. account
closed on 09/03/2014.” Miller Decl., Ex. 3. The October 30, 2014 ACDV provided additional
information in that field: “On September 3, 2014, Plaintiff paid the debt at issue in full by paying
$202, the balance as of that date. Plaintiff disputed the Selco a/c through TransUnion shortly
after 09/03/2014. Defendant Selco verified the accuracy of the information in resp.” Miller Decl.,
Ex. 4.
The e-OSCAR manual describes the “FCRA Relevant Info” field:
Dispute related information and other details that have been provided by the
consumer and/or the CRA. This is extremely important information that should be
considered when responding to the dispute. This information along with the
Dispute Code will provide insight into why the consumer disputed the account.
Miller Decl., Ex. 7, 17.
The e-OSCAR manual also provides several different “Response Codes” for a furnisher
to use when responding to an ACDV. See Miller Decl., Ex. 7, 16. The first response is “1
Account information accurate as of date reported.” The manual describes that response as
indicating “The account is accurately reported and there are no changes necessary.” This is in
fact the response that SELCO used in its first three responses. SELCO chose response code 2 in
8 – OPINION AND ORDER

its fourth response (which resulted in TransUnion fixing the inaccuracies). That response is “2
Modify account information as indicated.” Miller Decl., Ex. 7, 16.
A jury could conclude SELCO reasonably relied on the e-OSCAR manual and training in
limiting its investigation to the “Date of Account Information” provided by TransUnion. Or, the
jury could look at the competing declaration and decide that while there was confusion on the
part of CRAs and furnishers, SELCO acted reasonably under the circumstances. Finally, the jury
could look at the FCRA relevant information provided by TransUnion on the second and third
ACDVs and conclude SELCO’s limited investigation was unreasonable.
CONCLUSION
Because genuine questions of material fact remain, the cross motions for summary
judgment, ECF Nos 28, 30 are DENIED.
IT IS SO ORDERED.
DATED this 11th day of January, 2015.

____/s/ Michael McShane____
Michael McShane
United States District Judge

9 – OPINION AND ORDER