FITZGERALD v. TRANS UNION, LLC et al
MEMORANDUM OPINION. SIGNED BY HONORABLE MITCHELL S. GOLDBERG ON 1/8/18. 1/9/18 ENTERED AND COPIES E-MAILED. (va, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
PETER R. FITZGERALD,
TRANS UNION, LLC,
January 8, 2018
Plaintiff Peter R. Fitzgerald has sued Defendants Trans Union, LLC, Equifax Information
Services, LLC, Experian Information Solutions, Inc., WSFS Bank, and Penn Liberty Bank
(collectively, “Defendants”), alleging both violations of the Fair Credit Reporting Act and
Defendants Penn Liberty Bank and WSFS Bank have moved to dismiss the
Complaint. For the following reasons, the Motion will be granted in part and denied in part.
FACTS ALLEGED IN THE COMPLAINT1 AND PROCEDURAL HISTORY
According to the Complaint, after years of making payments on a loan with Defendant
Penn Liberty Bank (“Penn”), Penn advised Plaintiff to stop paying on account number
When determining whether to grant a motion to dismiss, a federal court must construe the
complaint liberally, accept all well-pleaded factual allegations in the complaint as true, and draw
all reasonable inferences in favor of the plaintiff. Fowler v. UPMC Shadyside, 578 F.3d 203,
211 (3d Cir. 2009). In accordance with this principle, my recitation of the facts assumes the truth
of the factual statements in the Complaint.
After that instruction, Defendant WSFS Bank (“WSFS”) acquired Penn.
(Compl. ¶¶ 10–11.)
Since then, both Penn and WSFS have allegedly been inaccurately furnishing credit data
on Plaintiff’s credit reports as published by Defendants Trans Union, LLC (“Trans Union”),
Equifax Information Services, LLC (“Equifax”), and Experian Information Solutions, Inc.
(“Experian”) regarding alleged account number 45854500****. Likewise, WSFS has allegedly
been inaccurately furnishing credit data on Plaintiff’s credit reports regarding account number
1915111790****. Plaintiff claims that the balance, past due balance, and written-off balance for
both accounts are incorrect. (Id. ¶¶ 12–15.)
Plaintiff first noticed the inaccuracies in early 2017.
He disputed the information
regarding the WSFS and Penn trade lines with Trans Union, Equifax, and Experian, and stated
that the reporting of these accounts was inaccurate. Trans Union, Experian, and Equifax each
acknowledged receipt of Plaintiff’s dispute and informed WSFS and Penn of the dispute. (Id.
¶¶ 19–20.) Thereafter, Trans Union, Experian, and Equifax notified Plaintiff that the accounts
had been “verified” and that Plaintiff’s identified inaccuracies would not be corrected. (Id.
Plaintiff alleges that, as a result of Defendants’ continued false credit reporting, his credit
score has dropped substantially, causing him to be denied a car loan, to accept another auto loan
at a high interest rate, and to refrain from applying for additional credit. (Id. ¶ 27.)
On August 25, 2017, Plaintiff filed the present suit against Defendants alleging a claim
under the Fair Credit Reporting Act, 15 U.S.C. § 1681, et seq. (Count I) and a claim for
defamation of character (Count II).
Defendants WSFS and Penn moved to dismiss the
Complaint on September 27, 2017.
STANDARD OF REVIEW
Under Federal Rule of Civil Procedure 12(b)(6), a defendant bears the burden of
demonstrating that the plaintiff has not stated a claim upon which relief can be granted. Fed. R.
Civ. P. 12(b)(6); see also Hedges v. United States, 404 F.3d 744, 750 (3d Cir. 2005). The United
States Supreme Court has recognized that “a plaintiff’s obligation to provide the ‘grounds’ of his
‘entitle[ment] to relief’ requires more than labels and conclusions.” Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555 (2007) (quotations omitted). “[T]hreadbare recitals of the elements of a cause
of action, supported by mere conclusory statements, do not suffice” and “only a complaint that
states a plausible claim for relief survives a motion to dismiss.” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009). “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. A complaint does not show an entitlement to relief when the well-pleaded facts do
not permit the court to infer more than the mere possibility of misconduct. Id.
The United States Court of Appeals for the Third Circuit has detailed a three-step process
to determine whether a complaint meets the pleadings standard. Bistrian v. Levi, 696 F.3d 352
(3d Cir. 2014). First, the court outlines the elements a plaintiff must plead to state a claim for
relief. Id. at 365. Next, the court must “peel away those allegations that are no more than
conclusions and thus not entitled to the assumption of truth.” Id. Finally, the court “look[s] for
well-pled factual allegations, assume[s] their veracity, and then ‘determine[s] whether they
plausibly give rise to an entitlement to relief.’” Id. (quoting Iqbal, 556 U.S. at 679). The last
step is “a context-specific task that requires the reviewing court to draw on its judicial experience
and common sense.” Id. (quoting Iqbal, 556 U.S. at 679).
WSFS and Penn set forth two grounds for their Motion to Dismiss. First, they allege that
the Complaint fails to adequately state a claim under the FCRA. Second, they assert that the
defamation claim is both improperly pled and preempted by the FCRA.
Fair Credit Reporting Act Claim
Plaintiff’s claim against WSFS and Penn is premised on 15 U.S.C. § 1681s–2(b), a
provision of the FCRA that regulates how the furnishers of credit information must respond
when they are given notice of a dispute over consumer credit records. Section 1681s–2(b)
provides, in relevant part:
(1) 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
(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
(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;
(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
15 U.S.C. § 1681s–2(b).
If a furnisher fails to comply with these requirements, then § 1681n and § 1681o
“authorize[ ] consumers to bring suit for damages caused by a furnisher’s . . . breach” when that
breach is willful or negligent, respectively. Seamans v. Temple Univ., 744 F.3d 853, 864 (3d
Cir. 2014). First, however, a consumer must notify the credit reporting agency (“CRA”) of the
disputed item and, in turn, the CRA must give notice to the furnisher that provided the disputed
credit information. Horsch v. Wells Fargo Home Mortg., 94 F. Supp. 3d 665, 672 (E.D. Pa.
2015). Ultimately, to state a claim in a suit arising under § 1681s–2(b), “a plaintiff must allege
(1) that he notified a credit reporting agency (“CRA”) of the dispute under § 1681i, (2) that the
CRA notified the party who furnished the information; and (3) that the party who furnished the
information failed to investigate or rectify the disputed charge. Id. (citing Taggart v. Norwest
Mortg., Inc., No. 09–1281, 2010 WL 114946, at *9 (E.D. Pa. Jan. 11, 2010), aff’d, 539 F. App’x
42 (3d Cir. 2013)).
Here, Plaintiff has sufficiently plead all three elements to state a claim under section
1681s-2(b). As to the first element, Plaintiff alleges that both Penn and WSFS inaccurately
furnished credit data on Plaintiff’s credit reports regarding two loans—which he identifies by
loan number—and that he reported the disputed information to the three CRAs—Equifax, Trans
Union, and Experian. (Compl. ¶¶ 13–18.) “When a plaintiff alleges contact with a consumer
credit agency, [c]ourts in this Circuit have usually permitted complaints to proceed on the
premise that discovery is warranted to ascertain whether or not a claim actually exists.” Edwards
v. Equable Ascent, FNCL, LLC, No. 11-2638, 2012 WL 1340123, at *6 (D.N.J. Apr. 16, 2012)
(citing cases). As to the second element, plaintiff sufficiently alleges that the three credit
reporting agencies contacted Penn and WSFS and “notified” them “of Plaintiff’s dispute.”
(Compl. ¶ 20.) Finally, Plaintiff has adequately pled the third element by averring that “[e]ach
Defendant willfully and negligently failed to employ and follow reasonable procedures to
investigate Plaintiff’s dispute and correct and/or delete the information appearing on his credit
reports.” (Compl. ¶ 23.)
In an effort to have this claim dismissed, WSFS and Penn assert that “Plaintiff simply
does not allege, with any specificity, the who, what, where, when, why and how of his case,
having failed to assert even the most basic facts such as who allegedly told him ‘to stop paying’
his loan obligations, when he was told, how he was told or even what Plaintiff believes to be the
meaning of ‘stop paying’.” (Defs.’ Mem. Supp. Mot. to Dismiss 5.) Defendants go on to argue
that the Complaint’s allegations “do not adequately distinguish between the alleged violations of
the various named defendants, and instead offer legal conclusions for which no factual support or
explanation is provided.” (Id.)
Defendants’ argument imposes too great of a pleading burden on Plaintiff. Federal Rule
of Civil Procedure 8 requires only “a short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). Detailed factual allegations of the type
demanded by Defendants are not required by Rule 8, but rather are more akin to the type
required for allegations of fraud under the heightened standard of Federal Rule of Civil
Procedure 9(b). While the Complaint here could be more specific, it is sufficient to give
Defendants fair notice of the basis of the claim, and to raise a plausible claim for relief under the
Fair Credit Reporting Act. 2
Plaintiff appears to recognize that the Complaint may be lacking in detail, as he includes,
in his responsive brief, a Declaration from Plaintiff, together with multiple supporting exhibits.
It is well established, however, that on a motion to dismiss, “courts generally consider only the
allegations contained in the complaint, exhibits attached to the complaint and matters of public
record.” Pension Benefit Guaranty Corp. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d
Cir.1993). Neither Plaintiff’s Declaration nor the exhibits were attached to or otherwise included
in the Complaint and, therefore, I may not consider these documents.
WSFS and Penn next allege that because state common law claims are preempted by 15
U.S.C. § 1681t(b)(1)(F) of the FCRA, Plaintiff’s defamation claim must be dismissed. On this
point, I agree with Defendants and will dismiss this claim.
Section 1681t(b)(1)(F) states that “[n]o requirement or prohibition may be imposed under
the laws of any State . . . with respect to any subject matter regulated under . . . section 1681s–2
of this title, relating to the responsibilities of persons who furnish information to consumer
reporting agencies.” 15 U.S.C. § 1681t(b)(1)(F). Although not yet addressed by the Third
Circuit, several other Circuit Courts have held that § 1681t(b)(1)(F) preempts all state and
common law claims against furnishers of information with respect to all subject matter regulated
under § 1681s-2. See, e.g., Purcell v. Bank of Am., 659 F.3d 622, 625–26 (7th Cir. 2011)
(finding defamation claim preempted by § 1681t(b)(1)(F)); Macpherson v. JPMorgan Chase
Bank, N.A., 665 F.3d 45, 47–48 (2d Cir. 2011) (same); Marshall v. Swift River Academy, LLC,
327 F. App’x 13, 15 (9th Cir. 2009) (same); Pinson v. Equifax Credit Info. Servs., Inc., 316 F.
App’x 744, 751 (10th Cir. 2009) (finding state libel and false light invasion of privacy claims to
be preempted by § 1681t(b)(1)(F)).
Multiple district courts within the Third Circuit have likewise adopted this conclusion
and found that Section 1681t(b)(1)(F) preempts both state statutory and common law claims
against furnishers of information acting under § 1681s-2. Lalonde v. Bank of Am., N.A., No.
16-1586, 2016 WL 7734690, at *2 (W.D. Pa. Dec. 15, 2016), report and recommendation
adopted by 2017 WL 104965 (W.D. Pa. Jan. 11, 2017); Cicala v. Trans Union, LLC, Nos. 156790, 15-6801, 2016 WL 2622377, at *4 (E.D. Pa. May 9, 2016); Prukala v. TD Bank USA, No.
16-0894, 2016 WL 6191912, at *3 (M.D. Pa. Oct. 24, 2016), appeal dismissed (3d Cir. 2016);
Vullings v. Trans Union, LLC, 115 F. Supp. 3d 538, 543 (E.D. Pa. 2015); Grossman v. Trans
Union, LLC, 992 F. Supp. 2d 495, 500 (E.D. Pa. 2014); Goins v. MetLife Home Loans, No. 126639, 2014 WL 5431154, at *6–7 (E.D. Pa. Oct. 24, 2014); Burrell v. DFS Servs., LLC, 753 F.
Supp. 2d 438, 451 (D.N.J. 2010); Cosmas v. Am. Exp. Centurian Bank, 757 F. Supp. 2d 489,
500–01 (D.N.J. 2010).
In light of the significant weight of this authority, and based on the sound reasoning in
these cases, I likewise conclude that § 1681t(b)(1)(F) preempts both state statutory and common
Without acknowledging the existence of § 1681t(b)(1)(F), Plaintiff urges that under the
alternate preemption provision found in § 1681h(e), the FCRA does not preempt state common
law claims based on malice or willful intent to injure. Plaintiff contends that because the
Complaint alleges that WSFS and Penn acted with malice and willful intent to injure, the
defamation claim against these Defendants should not be preempted.
I recognize the line of cases from this Court holding that § 1681t(b)(1)(f) preempts only
state statutory claims and has no application to state common law claims. See, e.g., Barrie v.
Trans Union, LLC, No. 15-4213, slip op., ECF No. 31 (E.D. Pa. Oct. 14, 2015); Sassaman v.
Nationstar Mortg., LLC, No. 14-1589, 2014 WL 6473798, at *2 (E.D. Pa. Nov. 19, 2014); Sites
v. Nationstar Mortg., 646 F. Supp. 2d 699, 704–05 (E.D. Pa. 2009); Manno v. Am. Gen. Fin.,
439 F. Supp. 2d 418, 424 (E.D. Pa. 2006).
This interpretation of § 1681t(b)(1)(f) has fallen within the minority among cases
addressing this issue. As noted by the Second Circuit, “[t]he phrase ‘[n]o requirement or
prohibition’ [in § 1681t(b)(1)(f)] sweeps broadly and suggests no distinction between positive
enactments and common law; to the contrary, those words easily encompass obligations that take
the form of common-law rules.” Premium Mortg. Corp. v. Equifax, Inc., 583 F.3d 103, 106 (2d
Cir. 2009) (quoting Cipollone v. Liggett Group, Inc., 505 U.S. 504, 521 (1992) and Riegel v.
Medtronic, Inc., 552 U.S. 312 (2008)). Moreover, in enacting the FCRA, Congress intended to
avoid a patchwork framework of regulations on consumer reporting agencies and furnishers of
information that could be expanded or contracted by state law actions. Accordingly, I will adopt
the majority approach that § 1681t(b)(1)(f) preempts both state statutory and state common law
Plaintiff’s argument is misplaced as this provision does not apply here. Section 1681h(e)
states, in pertinent part, that,
[N]o consumer may bring any action or proceeding in the nature of
defamation, invasion of privacy, or negligence with respect to the
reporting of information against any consumer reporting agency,
any user of information, or any person who furnishes information
to a consumer reporting agency, based on information disclosed
pursuant to section 1681g, 1681h, or 1681m of this title, or based
on information disclosed by a user of a consumer report to or for a
consumer against whom the user has taken adverse action, based in
whole or in part on the report except as to false information
furnished with malice or willful intent to injure such consumer.
15 U.S.C. § 1681h(e) (emphasis added). This provision preempts defamation claims against
furnishers of information where the information was disclosed pursuant to sections 1681g,
1681h, or 1681m of the FCRA, none of which are applicable here.4 Rather, both WSFS and
Penn are accused as furnishers of information reporting information under § 1681s-2. (See
Compl. ¶ 38 (“WSFS and Penn are liable to the Plaintiff for willfully and negligently failing to
comply with the requirements imposed on furnishers of information pursuant to 15 U.S.C.
§ 1681s-2(b).”).) Therefore § 1681h(e) does not apply.
In short, § 1681t(b)(1)(F) of the FCRA preempts all state statutory and common law
claims against furnishers of information acting under § 1681s-2. As such, Plaintiff’s defamation
claim must be dismissed.
Sections 1681g and 1681h apply only to consumer reporting agencies, not furnishers of
information like WSFS or Penn. 15 U.S.C. §§ 1681g & 1681h. Section 1681m applies where
the furnisher of the information disclosed the information and the user of the consumer report
took an adverse action against the consumer. 15 U.S.C. § 1681m. No such “adverse action” is
alleged in the Complaint.
Plaintiff has sufficiently pled a claim against Defendants WSFS and Penn under the
FCRA. However, Plaintiff’s defamation claim falls within the FCRA’s preemption provision of
15 U.S.C. § 1681t(b)(1)(F) and will be dismissed. An appropriate order follows.
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