Mendoza v. Conns Credit Services, Inc.

Filing 2

ORDER TO SHOW CAUSE as to Manuel Galindo Mendoza. Show Cause Response due by 4/12/2012.. Signed by Judge Nancy Stein Nowak. (rf)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF TEXAS
SAN ANTONIO DIVISION

MANUEL GALINDO MENDOZA,

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Plaintiff,
v.
CONS CREDIT CORP. INC.,
Defendant.

CIV. NO. SA-12-CA-228-XR

O R D E R
On this day came on to be considered the matter of plaintiff’s
failure to state a claim in his complaint under the Fair Credit
Reporting Act (“FCRA”), 15 U.S.C. § 1681s-2, et seq.

This is one of

a large number of cases filed recently by this individual and other
plaintiffs

pro

Practices Act.

se

under

the

FCRA

and

the

Fair

Debt

Collection

The complaints make similar allegations and even the

same spelling and grammatical errors, giving the Court reason to
believe they derive from the same source.

For that reason, the

Court has screened the complaints to assure that they state a claim
upon which relief can be granted.
Standard of Review
Rule

12(b)(6)

of

the

Federal

Rules

of

Civil

Procedure

authorizes the filing of a motion to dismiss a case for failure to
state a claim upon which relief can be granted.

A district court

may dismiss a complaint sua sponte for failure to state a claim.
Carroll v. Fort James Corp., 470 F.3d 1171, 1177 (5 th Cir. 2006).

Under Federal Rule of Civil Procedure 8(a)(2), a pleading must
contain a short and plain statement of the claim showing that the
pleader is entitled to relief.

To state a claim upon which relief

can be granted, the factual allegations must be sufficient to state
a claim to relief that is plausible on its face and to raise a right
Bell Atlantic Corp. v.

to relief above the speculative level.
Twombly, 550 U.S. 544, 555, 570 (2007).

A complaint need not

contain detailed factual allegations, but must include more than
labels and conclusions or a formalistic recitation of the elements
of a cause of action.
A

claim

has

Id. at 555.

facial

plausibility

when

the

pleaded

factual

content allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.

Ashcroft v. Iqbal,

556 U.S. ___, 129 S.Ct. 1937, 1940, 173 L.Ed.2d 868 (2009).
mere possibility of misconduct is not sufficient.
1950.

The

Id., 129 S.Ct. at

The Court must accept all well-pleaded facts as true, viewing

them in the light most favorable to the plaintiff.

Lindquist v.

City of Pasadena, Tex., 525 F.3d 383, 386 (5 th Cir. 2008).

However,

the Court need not accept plaintiff’s legal conclusions as true.
Iqbal, 129 S.Ct. at 1949.

Threadbare recitals of the elements of a

cause of action, supported by mere conclusory statements, will not
suffice.

Id.
Background

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Plaintiff alleges that defendant has violated the FCRA “with
regard

to

inaccurate

and

erroneous

reports

of

derogatory

and

negative credit information made by Defendants to national reporting
agencies, and for failure of Defendants to properly notify that the
consumer

reporting

account...”

agencies

the

Plaintiff

was

disputing

the

Plaintiff alleges that, on or about February 7, 2012,

he notified defendant and the consumer reporting agencies by mail
and

via

the

Internet

that

he

disputed

account

number

25063.

Subsequently, on or about March 8, 2012, according to plaintiff,
defendant responded to the consumer reporting agencies that the
accounts were updated but did not indicate that the accounts were
disputed.
Plaintiff states that, on several occasions, he contacted the
consumer reporting agencies by telephone and the Internet to address
the accounts.

He asserts that, on each occasion, the consumer

reporting agencies contacted defendant to investigate the account,
and that defendant verified or updated the information but did not
correct the erroneous information.

Plaintiff also contends that

defendant did not advise the consumer reporting agencies that the
accounts were disputed.

Plaintiff alleges that defendant violated

§ 1681s-2 by not reporting the account as “account information
disputed

by

consumer”

after

being

notified

plaintiff and by the credit reporting agencies.
foregoing

acts

and

omissions

constitute

of

dispute

by

He states that the

numerous

violations of the FCRA, citing to § 1681s-2(b).

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the

and

multiple

Plaintiff also

complains that defendant failed to advise the consumer reporting
agencies

that

consumer,”

the

as

account

required

by

information
§

was

“disputed

1681s-2(a)(3).

He

seeks

by

the

damages

pursuant to § 1681n (willful noncompliance) and § 1681o (negligent
noncompliance).
Analysis
Plaintiff’s complaint does not state a claim upon which relief
can be granted.
consumer
“disputed

He alleges that defendant failed to advise the

reporting
by

the

agencies
consumer,”

that

account

required

as

the

by

information

§

was

1681s-2(a)(3).

Plaintiff has attempted to state a cause of action under § 1681s2(a)(3) and obtain damages under §§ 1681n and 1681o.

However, §§

1681s-2(c) and (d) state that a claim for violation of § 1681s-2(a)
can be pursued only by federal or state officials, and not by a
See Devoll v. Fleet Bank, 2007 WL 1889227, at *2

private party.
(W.D.Tex. 2007).

Plaintiff also sues defendant under § 1681s-2(b).

Section 1681s-2(b)(1) provides that, after receiving notice
pursuant

to

§

1681i(a)(2)

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

the

consumer

information;
(B)

review

all

relevant

information

provided

by

reporting agency pursuant to section 1681i(a)(2) of this title;

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(C)

report

the

results

of

the

investigation

to

the

consumer

reporting agency;
(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; and
(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

information.
Plaintiff does not allege that defendant failed to conduct an
investigation with respect to the disputed information, failed to
review all relevant information provided by the consumer reporting
agency, failed to report the results of the investigation to the
consumer

reporting

incomplete

or

plaintiff

states

information.
dispute...”

agency,

inaccurate
that

or

or

found

could

defendant

that

not

be

the

information

verified.

“verified

or

In

updated”

was

fact,
the

He simply states that defendant “did not address the
and

“did

not

correct

the

erroneous

information.”

Plaintiff’s allegations demonstrate that defendant addressed the

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dispute.

Nothing in § 1681s-2(b) requires defendant to correct

information simply because the consumer believes it is erroneous.
Bashore v. Resurgent Capital Services, L.P., 2011 WL 6089483, at *1
(5th Cir. 2011)(plaintiff’s “assertion that the [FCRA] mandates that
the allegedly inaccurate information be deleted from her credit
reports on account of her dispute is inaccurate].
Although plaintiff has failed to state a claim, he shall be
given an opportunity to amend his complaint to cure the defects.

By

April 12, 2012, plaintiff must file an amended complaint alleging
facts, not conclusions, to support his claims.

If plaintiff intends

to state a claim under § 1681s-2, he must identify the specific
provision of that section under which he intends to sue and state
sufficient facts showing that he can maintain a cause of action
under that provision.

If any communications between himself, the

credit reporting agencies, and/or the defendant are a necessary
element of the claim, he must attach a copy of the communication to
the amended complaint or suitable alternative evidence that the
communication

exists.

The

allegations

in

plaintiff’s

amended

complaint must be verified under penalty of perjury in accordance
with 28 U.S.C. § 1746.

Failure to comply with this Order shall

result in a recommendation that this lawsuit be dismissed.
Plaintiff

is

advised

that,

pursuant

to

Rule

11(b),

Fed.R.Civ.P., his lawsuit must have a factual and legal basis.
Under that rule, by presenting to the court a pleading, written

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motion, or other paper--whether by signing, filing, submitting, or
later advocating it--an attorney or unrepresented party certifies
that to the best of the person's knowledge, information, and belief,
formed after an inquiry reasonable under the circumstances:
(1) it is not being presented for any improper purpose, such as to
harass, cause unnecessary delay, or needlessly increase the cost of
litigation; (2) the claims, defenses, and other legal contentions
are warranted by existing law or by a nonfrivolous argument for
extending, modifying, or reversing existing law or for establishing
new law; (3) the factual contentions have evidentiary support or, if
specifically so identified, will likely have evidentiary support
after

a

reasonable

opportunity

for

further

investigation

or

discovery; and (4) the denials of factual contentions are warranted
on the evidence or, if specifically so identified, are reasonably
based on belief or a lack of information.
can subject the person to sanctions.

Violation of this rule

If plaintiff does not have a

factual or legal basis for this lawsuit, he should submit a motion
to dismiss under Rule 41(a)(1), Fed.R.Civ.P.
It is so ORDERED.
SIGNED on March 27, 2012.

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NANCY STEIN NOWAK
UNITED STATES MAGISTRATE JUDGE

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