Mendoza v. Equable Ascent Financial LLC et al

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,
Plaintiff,
v.
EQUABLE ASCENT FINANCIAL, LLC,
and DOES 1 through 30,
Defendants

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CIV. NO. SA-12-CA-241-FB

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 se under the FCRA and the Fair Debt Collection
Practices Act.

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 (5th 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
Bell Atlantic Corp.

right to relief above the speculative level.
v. 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.

Id. at 555.

A claim has 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.
at 1950.

The

Id., 129 S.Ct.

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 (5th 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.

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Id.

Background
Plaintiff alleges that, on or about February 7, 2012, he he
requested his credit report which showed some inaccuracies in the
information furnished by defendant.

On the same day, he notified

the consumer reporting agencies via the Internet and defendant via
the mail that he was disputing a certain account. Subsequently, on
or

about

March

11,

2012,

according

to

plaintiff,

responded to the consumer reporting agencies.

defendant

Plaintiff alleges

that defendant violated § 1681s-2(a)(1)(A) by reporting information
with actual knowledge of errors.

He also states that defendant

violated § 1681s-2(a)(1)(B)(i) and (ii) by reporting information to
the consumer reporting agencies after notice and confirmation of
errors.
Plaintiff next alleges that, on March 13, 2012, plaintiff
notified defendant and the consumer reporting agencies by mail and
fax that defendant had not performed its duty to provide notice of
the dispute in violation of § 1681s-2(a)(3).

He contends that, on

several occasions, he disputed the accuracy and completeness of
his credit reports to defendant and by telephone to the credit
reporting agencies.

Plaintiff asserts that, on each occasion, the

credit reporting agencies and defendant investigate the account and
verified

the

information.
consumer

information

but

did

not

correct

the

erroneous

He also alleges that defendant did not advise the

reporting

agencies

that

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the

account

was

disputed.

Plaintiff states that the foregoing acts and omissions constitute
numerous and multiple violations of the FCRA, citing to § 1681s2(b).

He

seeks

damages

pursuant

to

§

1681n

(willful

noncompliance).
Analysis
Plaintiff’s complaint does not state a claim upon which relief
can be granted.
2(a)(1)(A)
errors.

by

He alleges that defendant violated § 1681s-

reporting

information

with

actual

knowledge

of

Plaintiff also states that defendant violated § 1681s-

2(a)(1)(B)(i) and (ii) regarding the reporting of information after
notice and confirmation of errors.

He contends that defendant

failed to advise the consumer reporting agencies that the account
information was “disputed by the consumer,” as required by § 1681s2(a)(3).
1681o.

Plaintiff attempts to obtain damages under §§ 1681n and
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 private party.

See Devoll v. Fleet Bank,

2007 WL 1889227, at *2 (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--

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(A)

conduct

an

investigation

with

respect

to

the

disputed

information;
(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 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 agency, or found that the information was

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incomplete or inaccurate or could not be verified.
plaintiff

states

information.

that

defendant

“verified

or

In fact,

updated”

the

He simply states that defendant “did not address the

dispute...” and “did not correct the erroneous information.”
Plaintiff’s allegations demonstrate that defendant addressed the
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].

Thus, it does

not appear that plaintiff has stated a claim under § 1681s-2(b).
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.

Plaintiff

must specify what information defendant reported to the consumer
reporting agencies on or about March 11, 2012.

He must provide

some proof of that information and not speculate as to what
information was provided.
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

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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
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

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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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