Walters v. Certegy Check Services, Inc.

Filing 51

ORDER GRANTING IN PART AND DENYING IN PART Defendant's 46 Motion for Judgment on the Pleadings. Signed by Judge Sam Sparks. (lt)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TEXASZOI6 OCT -2 PH
AUSTIN DIVISION
MARK WALTERS,

L

32

JC,r_

Plaintiff,
CAUSE NO.:
A-17-CV-1100-SS

-vs-

CERTEGY CHECK SERVICES, INC.,
Defendant.

I]

1 P) I

BE IT REMEMBERED on this day the Court reviewed the file in the above-styled cause,
and specifically Defendant Certegy Check Services, Inc. (Certegy)'s Motion for Judgment on the

Pleadings [#46], Plaintiff Mark Walters's Response [#48] in opposition, and Certegy's Reply
[#49] thereto. Having reviewed the documents, the relevant law, and the file as a whole, the

Court now enters the following opinion and orders.

Background
Plaintiff, a citizen of Texas, brings this suit against Certegy, a "nationwide specialty

consumer reporting agency" incorporated in Delaware and operating its principal place of
business in Florida. Second Am. Compl. [#3 5] ¶J 2, 7. "Certegy provides check authorization

recommendations to merchants throughout the United States" which these merchants then use to
determine whether they should honor a check presented by a consumer. Id. ¶ 6. Certegy's

recommendations take into account the consumer's identification provided at the point of sale;
any unpaid debts in the form of previously returned checks; and a variety of risk factors bearing

on the likelihood that a check will be returned unpaid by the consumer's financial institution. Id.
1

This dispute centers on Plaintiff' s repeated inability to cash checks at several Austin-area

merchants as a result of Certegy's recommendations.
[#241 at

See

id.

¶ 11;

Order of March 12, 2018

1-2.' After several denials of his check-cashing privileges, Plaintiff called Certegy

requesting an explanation for these denials. Order of March 12, 2018 [#24] at 1-2. Plaintiff also
requested Certegy send him a copy of his consumer file, which Certegy delivered by mail. Id.at
1;

Second Am. Compl. [#35] ¶ 11-12.

Plaintiff's consumer file included four events associated with Plaintiff over the previous
twenty-four months. First, on July 18, 2017, Plaintiff attempted to cash a $4,000 check at WalMart, but Certegy recommended Wal-Mart reject the check because the "transaction fell outside

of the guidelines Certegy has established for authorization." Resp. [#20-1] Ex. A (Consumer File
Disclosure Report). Second, on August 19, 2017, Plaintiff attempted to cash a $202 check at a

grocery store, but Certegy recommended against cashing the check because the "transaction fell
outside the guidelines Certegy has established for authorization, based on factors such as

transaction frequency and patterns that reflect potential identity theft or unauthorized
transactions associated with the ID presented." Id. Third, on August 20, 2017, Plaintiff attempted
to cash a $200 check at a different grocery store, and Certegy again recommended against

accepting the check because the transaction fell outside of Certegy's guidelines. Id. Finally, also
on August 20, 2017, Plaintiff apparently attempted to cash the same check at the same grocery
store; Certegy recommended this check not be cashed because their "records indicated that the

same check or payment had been submitted.

1

. .

before, and authorization had been declined." Id.

For ease of reference, this order's citations to page numbers within the docket refer to the CMIECF

number.

2

Convinced these recommendations were in error, Plaintiff mailed a letter to Certegy on
August 28, 2017.

See

Order of March 12, 2018 [#24] at 3. In the letter, Plaintiff complained that

access to Certegy's guidelines was not available to consumers. Mot. Dismiss [#17-4] Ex. B
(Aug. 28th Letter). Plaintiff also disputed the accuracy of Certegy's recommendations and

requested a reinvestigation of the denied transactions as well as a correction of "all negative

information contained by Certegy and reported to any other credit reporting agency." Id.
Three days letter, Certegy mailed Plaintiff a response which stated, "Regarding the

decline you experienced, although there were no returned checks on file, the check fell outside of
approval guidelines." Mot. Dismiss [#17-5] Ex. Cl (Sept.

1

Letter). The letter declined to

"disclose those confidential, proprietary guidelines" because to do so "would seriously
[diminish] Certegy's ability to prevent any type of fraudulent activity."

Id

On October 25, 2017, Plaintiff filed suit in state court. Certegy properly removed the case
to this Court, asserting both federal question and diversity jurisdiction. Removal Notice [#1] ¶ 1.

Plaintiff then filed an amended complaint alleging Certegy violated the federal Fair Credit
Reporting Act (FCRA), the Texas Consumer Credit Reporting Act (TCCRA), and the Texas
Deceptive Trade Practices Act (DTPA). Order of March 12, 2018 [#24] at 4. Plaintiff also
alleged Certegy was liable for negligence, defamation, and fraud. Id.

On January 11, 2018, Certegy moved to dismiss Plaintiff's claims pursuant to Rule
12(b)(6) of the Federal Rules of Civil Procedure. Mot. Dismiss [#17-1] at 1-2. On March 12, this

Court dismissed both of Plaintiff's FCRA claims; two of Plaintiff's three TCCRA claims; two of

Plaintiff's three DTPA claims; and all of Plaintiff's common law claims. Order of March 12,
2018 [#24] at 13-14. In considering Plaintiff's FCRA claims, the Court found Plaintiff failed to

3

allege any inaccuracy in Certegy's consumer file report because he did not "assert any of the four

events contained in the report did not occur or were incorrectly reported." Id. at 7. Because an

alleged inaccuracy was an essential element of Plaintiff's inaccurate report claim and his
reasonable investigation claim, the Court dismissed both. Id. Similarly, the Court found Plaintiff

had failed to state a claim under

§

20.06 and 20.07 of the Texas Business and Commerce Code

because Plaintiff did not identif' any inaccurate information in his file or show he disputed the
completeness of the information contained in his file. Id. at 8-9.

Undeterred, Plaintiff sought and was granted leave by this Court to file a second amended
complaint. This second amended complaint alleges a consumer file prepared by Certegy on

December 16, 2017 contained two inaccuracies. In a reprise of his first amended complaint,

Plaintiff suggests the recommendations denying his check-cashing privileges contained in this
report were based on inaccurate information.

See

Second Am. Compl. [#35]

¶11

15, 24. The

second alleged inaccuracy is new: Plaintiff now alleges the December 16 consumer file failed to

include an unpaid check written on November

1,

2017 in a section titled "Outstanding Items." Id.

¶1118,26.

Plaintiff also claims Certegy failed to conduct a reasonable reinvestigation of his
December 16 consumer file. Second Am. Compi. ¶ 17. Plaintiff originally requested this

reinvestigation in a letter sent on December 24, 2017; this request was later supplemented by a
letter sent on January 3, 2018, which notified Certegy of the outstanding November

requested Certegy investigate the check as part of the reinvestigation

2

process.2

Id.

1

¶11

check and
19, 20;

see

Certegy did not receive a letter from Plaintiff regarding the November 1 check until January 3 because
Plaintiff himself did not know of the check until he received a letter from a collections agency on January 2, 2018.
Second Am. Compi. [#35] ¶ 18.

4

Mot. J. Pleadings [#46] App. Ex. B (Dec. 24th Letter); Resp. [#481 Ex. 6 (Jan. 3d Letter).

Though Plaintiff concedes "Certegy completed the reinvestigation [he] asked for," he contends

Certegy's failure to include the November

1

check in a reinvestigation report indicates Certegy's

reinvestigation was not reasonable. Second Am. Compi. [#35] ¶ 20.
On these bases, Plaintiff alleges Certegy violated the FCRA, the TCCRA, and the DTPA.
Id. JJ 23-29, 35-39, 44-47, 49-50. Certegy now moves for judgment on the pleadings pursuant

to Rule 12(c) of the Federal Rules of Civil Procedure. Mot. J. Pleadings [#46] at 1. Certegy's

motion has been fully briefed and is ripe for decision.

Analysis
I.

Legal Standard
Rule 12(c) permits a party to move for judgment on the pleadings "[a]fter the pleadings

are closed but within such time as not to delay the trial."

FED.

R.

CIV. P.

12(c). "A motion

brought pursuant to Rule 12(c) is designed to dispose of cases where the material facts are not in
dispute and a judgment on the merits can be rendered by looking to the substance of the

pleadings and any judicially noticed facts." Herbert Abstract Co.

v.

Touchstone Props., Ltd., 914

F.2d 74, 76 (5th Cir. 1990) (internal citations omitted).

In the Fifth Circuit, a Rule 12(c) motion is subject to the same standard applicable to a

Rule 12(b)(6) motion to dismiss for failure to state a claim. Johnson
529 (5th Cir. 2004); Great Plains Trust Co.

v.

v.

Johnson, 385 F.3d 503,

Morgan Stanley Dean Witter & Co., 313 F.3d 305,

313 n.8 (5th Cir. 2002). Thus, the court must look only to the pleadings, construing such

pleadings liberally and accepting all allegations contained therein as true. Brittan Commc 'ns Int'l
Corp.

v. Sw.

Bell Tel. Co., 313 F.3d 899, 904 (5th Cir. 2002). At the same time, a court is not

bound to accept legal conclusions couched as factual allegations, Papasan

v.

Allain, 478 U.s.

265, 286 (1986), and although all reasonable inferences will be resolved in favor of the plaintiff,

the complaint must include "specific facts, not mere conclusory allegations." Tuchman

v.

DSC

Commc'ns Corp., 14 F.3d 1061, 1067 (5th Cir. 1994).

II.

Application
The Court first considers Plaintiff's FCRA claims. It then turns to Plaintiff's state law

claims.
A.

FCRA Claims

Under the FCRA, when a consumer reporting agency such as Certegy prepares a
consumer

file,3

they must have "reasonable procedures" in place to "assure maximum possible

accuracy of the information" in the file. 15 U.S.C.

§

1681e(b). Additionally, if a consumer

disputes "the completeness or accuracy" of any information in the consumer's file and notifies
the agency of this dispute, the agency must conduct a reasonable reinvestigation of the
information in the consumer's file. Id.

§

1681i(a)(1)(A). The adequacy of an agency's

reinvestigation procedures is judged according to what a reasonably prudent person would do
under the circumstances. Thompson v. San Antonio Retail Merchants Ass 'n, 682 F.2d 509, 513
(5th Cir. 1982). In most cases, the reasonableness inquiry is a question for the finder of fact.

Cousin

v.

Trans Union Corp., 246 F.3d 359, 368 (5th Cir. 2001) (citing Cahlin

v.

Gen. Motors

Acceptance Corp.,936 F.2d 1151, 1156 (11th Cir. 1991)).

The parties do not address whether Certegy's consumer file is a report under the FCRA. For purposes of
evaluating the pending motion for judgment on the pleadings, the Court assumes the consumer file is a report that
must meet the requirements of the FCRA.

The FCRA contains two separate damages provisions. If a consumer reporting agency

negligently fails to comply with the FCRA, a consumer may recover actual damages resulting
from the agency's failure to comply. See 15 U.S.C.

§

1681o(a)(1). If a consumer reporting

agency willfully fails to comply with the FCRA, however, a consumer may recover either actual
damages or statutory damages. 15

u.s.c. §

1681n. A plaintiff need not show "malice or evil

motive" to establish a consumer reporting agency acted willfully in violation of

§ 168 in;

rather,

the standard is met when the agency acts "knowingly and intentionally." Cousin, 246 F.3d at 372
(citing Pinner v. Schmidt, 805 F.2d 1258, 1263 (5th Cir. 1986)).
1.

Plaintiff's

§ 1681e

Claim

Plaintiff claims Certegy violated

§ 1681 e

because the consumer file it produced on

December 16 was inaccurate in two ways. First, Plaintiff argues the consumer file was inaccurate
because it included recommendations to deny Plaintiff's check-cashing privileges that were
based on incorrect information. Second Am. Compi. [#35]

¶IJ

24, 26. Second, Plaintiff argues

Certegy's consumer file was inaccurate because it failed to include the delinquent November

1

check as an "outstanding item." Id. ¶ 18.

Plaintiff's first argumentthat the December 16 consumer file "inaccurately"
recommended denying Plaintiff's check-cashing

privilegesis easily disposed of. As this Court

previously determined in ruling on Plaintiff's first amended complaint, "to adequately establish a
prima facie case that a reporting agency failed to follow reasonable procedures in violation of
§ 1681 e(b),

a plaintiff must first allege an inaccuracy in the consumer report." Order of March

12, 2018 [#24] at 7 (emphasis added); see also Tolliver v. Experian Info. Sols., Inc., 973 F. Supp.

707, 715 (S.D. Tex. 2013) ("In order to establish a prima facie case under § 1681e(b), a

7

consumer must produce some evidence of an inaccuracy in her credit report."); Norman

v.

Experian Info. Sols., Inc., No. 3:12-CV-128-B, 2013 WL 11774625, at *4 (N.D. Tex. Apr. 25,
2013). But the information Plaintiff claims was inaccurate did not appear in the report: rather, it

formed the basis of the recommendations appearing in the report. Plaintiff does not allege the
recommendations in the report were made in response to events that never occurred, nor does he
allege the recommendations were incorrectly reported. Thus, because Plaintiff does not allege the
recommendations appearing in the report were inaccurate, the Court again concludes Plaintiff
fails to show the recommendations rendered the December 16 consumer inaccurate in violation

of 1681e(b).
Plaintiff's next argues the December 16 consumer file was inaccurate because it failed to
include the delinquent November

1

check in the file's "Outstanding Items" section. Second Am.

Compl. [#35] ¶ 18. Because Plaintiff alleges Certegy is liable for damages pursuant to
he must plead sufficient facts to indicate Certegy's omission of the November

willful. See Id ¶ 29, 56; 18 U.S.C.

§ 168 in.

1

§

1681n,

check was

Plaintiff must therefore allege Certegy knowingly

and intentionally failed to include the November

1

Plaintiff alleges he did not know about the November

check. See Cousin, 246 F.3d at 372. But
1

check until January 2, 2018, and he does

not offer any facts Certegy knew about the November

1

check prior to Plaintiff's January 3

letter. Second Am. Compl. [#35] ¶ 18. For these reasons, the Court finds Plaintiff fails to show

Certegy is liable under

§

1681 e(b) for omitting the November

1

check from the December 16

consumer file.
Thus, because Plaintiff fails to allege the recommendations on the December 16

consumer file were inaccurate and fails to allege the omission of the November

8

1

check was

willful, the Court grants Certegy's motion for judgment on the pleadings for Plaintiffs
§

1681e(b) claim.
2. Plaintiff's § 1681i Claim

Plaintiff also alleges Certegy failed to conduct a reasonable reinvestigation in violation of
§

1681i(a)(1)(A) of the FCRA. Second Am. Compl. [#35] ¶ 26. Specifically, Plaintiff claims

Certegy's reinvestigation could not have been reasonable because the reinvestigation report
failed to include the November

1

check under the "Outstanding Items" section despite Plaintiffs

January 3 letter informing Certegy of the omitted check. Id.;

see

Jan. 3d Letter. In response,

Certegy offers two arguments. First, Certegy contends it was under no duty to reinvestigate

because Plaintiff failed to identif' an inaccuracy in the report. Mot. J. Pleadings [#46] at 10-11.
Second, Certegy contends Plaintiff has not shown Certegy's reinvestigation was unreasonable.
Id. at 9-10.

Plaintiff has properly alleged Certegy should have reinvestigated the December 16 report
because of the omission of the November

1

check. Section 1681 i requires a consumer reporting

agency to conduct a reasonable reinvestigation when a consumer disputes either the accuracy or
completeness of the information in the consumer's file. 18 U.S.C.
3

§ 168 li(a)(1)(A).

The January

letter specifically notes the December 16 consumer file did not include the November

1

check

and requests Certegy "investigate this outstanding item during the reinvestigation process." Jan.
3d Letter. Certegy was thus under a duty to reasonably reinvestigate Plaintiffs consumer file
once it was notified Plaintiff disputed the completeness of the information in his file.

Additionally, Plaintiff pleads sufficient facts to indicate Certegy failed to conduct a
reasonable reinvestigation. Plaintiff alleges that Certegy received the January 3 letter, that

Certegy knew of the outstanding November

1

check, and that Certegy subsequently produced a

reinvestigation report that nevertheless omitted the check as an "outstanding item." Second Am.
Compi. [#35] ¶ 26. This omission following the reinvestigation creates a factual dispute as to the

reinvestigation's reasonableness. Because Certegy had a duty to conduct a reinvestigation and
because there is a factual dispute regarding the reasonableness of the reinvestigation, judgment
on the pleadings is inappropriate. Thus, the Court denies Certegy's motion for judgment on the
pleadings for Plaintiffs

§

168 li(a)(l)(A)

claim.4

In conclusion, the Court grants Certegy's motion for judgment on the pleadings on

Plaintiffs claim Certegy produced an inaccurate report in violation of

§

168 le(b). However,

because there are factual disputes regarding the reasonableness of Certegy's reinvestigation
procedures, the Court denies Certegy's motion for judgment on the pleadings on Plaintiff's
§

1681i(a)(1)(A) claim.
B.

TCCRA Claims

Plaintiff brings three claims against Certegy under the TCCRA, codified as Texas
Business and Commerce Code

§

20.021, 20.06, and 20.07. Second Am. Compi. [#35] ¶ 31.

First, Plaintiff claims Certegy violated

§

20.021 by failing to disclose the criteria it used to reject

Plaintiffs checks and by failing to provide a set of instructions describing how information is
presented in the written disclosures in Plaintiffs consumer file. Id.
claims Certegy violated

§

¶fJ

36, 37. Second, Plaintiff

20.06 by failing to reinvestigate Plaintiffs consumer file and by

failing to include the required statements and notices in its reinvestigation report. Id. ¶ 31, 35.
"Plaintiff has also pled sufficient facts to indicate Certegy' s failure to conduct a reasonable reinvestigation
was willful. See Second Am. Compl. ¶f 20, 26. Since Certegy does not contest this element in its motion for
judgment on the pleadings, the Court finds Plaintiff has created a factual dispute as to whether Certegy's failure to
reasonably reinvestigate was willful.
I'll

Third, Plaintiff claims Certegy violated

§

20.07 because it did not have reasonable procedures in

place to correct inaccurate information in Plaintiff's consumer file. Id. ¶ 38.
Certegy argues it is entitled to judgment on the pleadings on these claims because they
are preempted by the FCRA and because Plaintiff fails to plead sufficient facts to state a claim

for relief. Mot. J. Pleadings [#46] at 11-15. The Court first considers Certegy's argument that

Plaintiff failed to state a claim under the TCCRA before analyzing whether Plaintiff's TCCRA
claims are preempted by the FCRA.
1.

Failure to State a Claim Analysis
a. Plaintiff's § 20.021 Claim

Under Texas Business and Commerce Code

§

20.021, upon request and proper

identification by a consumer, a check verifier must disclose "all information pertaining to the
consumer in the check verifier's files," including "the criteria used by the check verifier to reject
a check from the consumer" and "a set of instructions describing how information is presented

on the check verifier's written disclosure of the consumer file."
§

TEX.

Bus. & COM. CODE

20.021(b)(1-2).
Plaintiff claims Certegy violated

§

20.02 1 by failing to disclose what criteria Certegy

uses in making recommendations and by failing to include "instructions describing how
information is presented in Plaintiff's written disclosures contained in his consumer file." Second
Am. Compl. [#35]

¶IJ

36-37. Certegy argues Plaintiff fails to state a claim under

11

§

20.021

because Certegy was not required to give the requested information under a competing provision
in the FCRA.5 Mot. J. Pleadings [#46] at 12-13.

Plaintiff sufficiently alleges he requested Certegy' s criteria for rejecting his check and
provided Certegy with the proper tracking number.

See id.

¶ 36;

see also

Dec. 24th Letter.

Plaintiff also alleges Certegy's response did not disclose its evaluation criteria or instructions on
how such information is presented to merchants. Second Am. Compi. [#35] ¶ 36. Plaintiff thus
states a plausible claim Certegy violated

§

20.02 1 that, if not preempted, survives Certegy's

motion for judgment on the pleadings.

b. Plaintiffs § 20.06 Claim
Under Texas Business and Commerce Code

§

20.06, if a consumer reporting agency is

notified by a consumer that there is a dispute about "the completeness or accuracy of

information" contained in the consumer's file, the agency is required to "reinvestigate the
disputed information." Upon completing the requested reinvestigation, the agency must provide
to the consumer written notice of the results of the reinvestigation, including a statement that the

reinvestigation is complete; a statement of the agency's determination on "the completeness or

accuracy of the disputed information"; a copy of the consumer's file and a description of the

reinvestigation's results; a statement that a description of the procedure used during the
reinvestigation process will be provided to the consumer upon request; a statement that the
consumer is entitled to add a statement to the file disputing the accuracy or completeness of the

In effect, Certegy argues Plaintiff cannot hold it liable under state law because it is in compliance with a

competingand preemptoryfederal law. See Mot. J. Pleadings [#46] at 12-13. Because this argument is tenable
only if § 20.021 is in fact preempted by the FCRA, the Court understands it to be a preemption argument, which it
considers below.

12

information; and a statement that the consumer may be entitled to dispute resolution.

TEX.

Bus.

& COM. CODE § 20.06(f).
Plaintiff's second amended complaint alleges Certegy violated
Plaintiff alleges Certegy violated

§

§

20.06 in two ways. First,

20.06(a) when it failed to conduct any reinvestigation in

response to the January 3 letter. Second Am. Compi. [#3 5] ¶ 35. However, Plaintiff concedes
Certegy "completed the requested reinvestigation" and sent Plaintiff a letter "claiming to have
conducted a reinvestigation." Id. ¶ 20. Even assuming Certegy's reinvestigation was inadequate,
§

20.06(a) requires only that a credit reporting agency "reinvestigate" disputed information in a

consumer's file.

TEX.

Bus. & COM. CODE

§

20.06(a). As Plaintiff concedes Certegy conducted a

reinvestigation, this allegation fails.

Plaintiff also alleges Certegy violated

§

20.06(f) because the reinvestigation notice it sent

Plaintiff failed to include statements and notices required by statute. In response, Certegy argues
it is exempt from § 20.06 because it is a "check verification company" and that, even

if § 20.06

is applicable, Plaintiff did not identify any inaccurate information in his report. Mot. J. Pleadings
[#46] at 13-14.

Neither argument is persuasive. First,

§

20.06(h) explicitly notes that

a business offering check verification or check guarantee services.
§

. .

20.06 "applies to

§

." TEX. Bus.

20.06(h). As Certegy concedes it is such a business, it is not exempt from

§

& C0M. CODE
20.06. Mot. J.

Pleadings [#46] at 14 (describing Certegy as "a business entity that provides only check
verification or check guarantee services"). Second,

§

20.06 requires a consumer reporting agency

to reinvestigate information that is disputed by the consumer based on its

accuracy."

TEX. Bus.

& COM. CODE § 20.06(a) (emphasis added).
13

"completeness

or

Thus, even if Plaintiff did not

identify any inaccurate infonnation in his consumer file, a reinvestigation was required because

Plaintiff disputed the completeness of the information in his file. Certegy must therefore comply
with the requirements of § 20.06(f).
Because Plaintiff pleads sufficient facts to indicate Certegy failed to produce a complete
reinvestigation report and Certegy has failed to demonstrate
states a plausible claim under

§

20.06(f) does not apply, Plaintiff

§

20.06(f) that, if not preempted, survives Certegy's motion for

judgment on the pleadings.
c.

Plaintiff's § 20.07 Claim

Although Plaintiff does not explain how Certegy violated

§

20.07, the Court nevertheless

examines this claim. If a credit reporting agency produces a report with inaccurate information,
the agency must give a person providing consumer credit information the option of submitting a

correction of the inaccurate information.

TEX.

Bus. & COM. CODE

§

20.07(a). A consumer

reporting agency who receives such a correction must also have reasonable procedures in place
to assure that previously reported inaccurate information is promptly corrected. Id.

§

20.07(b).

Plaintiff does not allege he submitted a correction of inaccurate information to Certegy; rather,
Plaintiff sent a letter requesting an investigation of information that was not in his file. Second
Am. Compl. [#35] ¶ 19;

see

Jan. 3d Letter ("Would you please

investigate

this outstanding item

during the reinvestigation process to ensure the accuracy of the report that you produce?").
Because Plaintiff has not alleged he submitted a correction of the information in his consumer

report file, he has failed to state a claim that Certegy violated

14

§

20.07.

2.

Preemption Analysis

Having determined Plaintiff has sufficiently pleaded claims under
§

20.02 1 and

§

20.06(f), the Court now analyzes whether either of these claims are preempted by the FCRA.

As to

§

20.02 1, Certegy's motion for judgment on the pleadings simply repeats verbatim

the arguments raised by Certegy in its recent motion to dismiss. Compare J. Mot. Pleadings
[#46] at 11-13 with Mot. Dismiss [#17-1] at 9-11. Absent new argument from Certegy, the

Court similarly repeats its conclusion that Plaintiff's claim under

either 15 U.S.C. §1681t(b)(1)(B) or

§

§

20.021 is not preempted by

1681g(a)(1)(B). See Order of March 12, 2018 [#24] at

9-

10.

The Court has not, however, yet had the chance to evaluate whether

preempted by the FCRA. 15 U.S.C.

§

20.06(f) is

1681t(b)(1)(B) preempts state laws from imposing any

§

requirement or prohibition with respect to "any subject matter regulated under

[

to the time by which a consumer reporting agency must take any action

.

. .

in any procedure

related to the disputed accuracy of information in a consumer's file

.

.

.

1681 i] relating

." 15 U.S.C. §

1681t(b)(1)(B).

Certegy argues

§ 1681 t(b)( 1 )(B)

preempts all claims arising out of state law "with respect

to any subject matter regulated under section 168 ii, including with respect to what are

commonly referred to as 'reinvestigation' procedures." Mot. J Pleadings [#46] at 11. But this

argument is contradicted by the clear language of the statute, which states

§ 1681 i

preempts

requirements or prohibitions under state law "relating to the time by which a consumer reporting
agency must take any action." 15 U.S.C.
v.

§

168 lt(b)(1)(B); see also Consumer Data Indus. Ass 'n

King, 678 F.3d 898, 901-02 (10th Cir. 2012) (noting

15

§

1681i has preemptive effect

"concerning the time by which [consumer reporting agencies] must take certain actions").
Moreover, Certegy offers no authority indicating the FCRA prevents a state from requiring
additional statements or disclosures on a reinvestigation report. Thus, the Court finds Plaintiff's
claim under

§

20.06(f) is not preempted by the FCRA.

In conclusion, Plaintiff fails to state a plausible claim under Texas Business and

Commerce Code

§

20.07, and the Court grants Certegy's motion for judgment on the pleadings

on this claim. By contrast, Plaintiff adequately pleads plausible claims Texas Business and
Commerce Code

§

20.021 and

§

20.06(f), and these claims are not preempted by the FCRA. The

thus Court denies Certegy's motion for judgment on the pleadings on these claims.

DTPA Claims

C.

Plaintiff alleges three separate claims under the DTPA. First, Plaintiff alleges Certegy
violated

§

17.50(a)(1) when Certegy representative told Plaintiff it would conduct a

reinvestigation but failed to do so.
alleges Certegy violated

§

1

See

Second Am. Compl. [#3 5] ¶J 44, 47. Second, Plaintiff

7.50(a)(2) when it breached an express warranty to conduct a

reinvestigation of Plaintiff's disputed consumer report file. Id. ¶ 49. Finally, Plaintiff alleges
Certegy is liable under the DTPA because it violated the TCCRA, which is a tie-in statute with

the DTPA. Id. ¶ 50. The Court addresses the "pure" DTPA claims before addressing the tie-in
provision.
1. Violation

of § 17.50(a)(1) and (2)

Section 17.50(a)(l) of the DTPA allows consumers to "maintain an action" against a

person who employs a "false, misleading, or deceptive act or practice" that is one of thirty-four

specifically enumerated practices that the consumer relied on to the consumer's detriment. Id.

Ir

§

1

7.50(a)(1 )(A-B). Additionally,

§

17. 50(a)(2) allows consumers to "maintain an action" where

a there is a "breach of an express or implied warranty." Id

Plaintiff appears to allege Certegy violated

§

1

§

17.50(a)(2).

7.50(a)(1) when a Certegy representative

misrepresented Certegy's reinvestigation procedures to Plaintiff.

See

Second Am. Compi. [#3 5]

¶ 46-47. In response, Certegy argues Plaintiffs second amended complaint does not identify a
false, misleading, or deceptive act or practice engaged in by Certegy. Mot. J. Pleadings [#46] at
16.

The Court agrees Plaintiff fails to identify a false, misleading, or deceptive act or practice
under

§

17.50(a)(1). Plaintiff alleges he called Certegy's toll-free number and spoke with a

Certegy representative who "outlined the reinvestigation procedures that would be conducted
upon Plaintiff's written request."

See

Second Am. Compi. [#35]

¶IJ

42, 46.

Plaintiff further

alleges this conversation constituted a "misrepresentation" because Certegy has "no reasonable
policies or procedures to conduct reinvestigations," as evidenced by the fact Certegy provided

him with a "mass produced form letter." Id.

¶J 44,

47. But Plaintiff does not identify any specific

discrepancy between the reinvestigation process described by the Certegy representative and the
reinvestigation process Certegy subsequently employed. Thus, Plaintiff has failed to properly
allege Certegy' s representative's description of the reinvestigation procedure constitutes a false,

misleading, or deceptive act or practice, and his claim under

§

17.50(a)(1) fails. The Court

therefore grants Certegy's motion for judgment on the pleadings for Plaintiff's claim under
§

17.50(a)(1).

Plaintiff further alleges Certegy violated

§

1

7.50(a)(2) when it breached an express

warranty by promising Plaintiff it would conduct a reinvestigation and then failed to do so. Id.

17

¶ 49. Certegy responds that Plaintiff has failed to plead sufficient facts to support his claim
Certegy breached an express warranty. Mot. J. Pleadings [#46] at 19.
The Court also agrees Plaintiff fails to plead sufficient facts Certegy breached an express

warranty. The only express warranty Plaintiff claims Certegy made to him is that it would
conduct a reinvestigation into his file. Second Am. Compl. [#35] ¶ 49. But Plaintiff fails to offer
any proof beyond Certegy's production of a form letter that Certegy breached an express

warranty to reinvestigate his claims in violation of

§

1

7.50(a)(2). Furthermore, as noted above,

Plaintiff concedes Certegy "completed the requested reinvestigation." Id. ¶ 20. Because Plaintiff
fails to adequately plead Certegy breached its express warranty to reinvestigate Plaintiffs file,

Plaintiffs claim under

§

1

7.50(a)(2) fails. The Court therefore grants Certegy's motion for

judgment on the pleadings on Plaintiffs claims brought under

§

17.50(a)(2).

2. Violation of Tie-in Statute

Plaintiff alleges Certegy is liable under the DTPA via a tie-in provision recognizing any
violation of the TCCRA as "a false, misleading, or deceptive act or practice" for purposes of the
DTPA. See TEx. Bus. & COM. CODE

§

20.12. Because the TCCRA contains a tie-in provision to

the DTPA, a plaintiff who properly alleges a violation of the TCCRA may bring a corresponding

claim under the DTPA based on the conduct giving rise to liability under the TCCRA. See id. As

Plaintiff has properly plead Certegy violated

20.02 1 and

§

§

20.06(f) of the TCCRA, those

violations form the basis for two corresponding DTPA claims and the Court denies Certegy's
motion for judgment on the pleadings on these claims. However, as Plaintiff fails to state a claim
under Texas Business and Commerce Code

§

20.07, the Court grants Certegy's motion for

judgment on the pleadings on the corresponding DTPA claim.

18

Conclusion
In sum, the Court dismisses with prejudice Plaintiff's claim brought under 15
§

1681e(b), his DTPA claims brought under Texas Business and Commerce code

and
§

§

§

U.s.c.

17.50(a)(l)

17.50(a)(2), his TCCRA claim brought under Texas Business and Commerce code

20.07, and that claim's corresponding DTPA claim brought under Texas Business and

commerce code

§

20.12. However, Plaintiff's claim brought under 15

his TCCRA claims brought under Texas Business and commerce code

u.s.c. §

§

1681i(a)(1)(A),

20.02 1 and

§

20.06(f),

and those claims' corresponding DTPA claims brought under Texas Business and Commerce
Code § 20.12 survive.

Accordingly,
IT IS THEREFORE ORDERED that Defendant Certegy Check Services, Inc.'s
Motion for Judgment on the Pleadings {#46] is GRANTED IN PART and DENIED iN
PART as described in this opinion.
SIGNED this the

day of October 2018.

SAr1P

SENIOR UNITED STATES DISTRICT JUDGE

19