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Anderson v. Equifax Information Services LLC

United States District Court, D. Kansas

August 3, 2017




         Plaintiff Angela Anderson filed suit against Defendant Equifax Information Services LLC alleging violations of the Fair Credit Report Act (“FCRA”).[1] Specifically, Plaintiff alleges Defendant merged her credit file with that of another consumer, sold consumer credit reports that included false accounts and information, and failed to remove false accounts and information in response to Plaintiff's numerous requests. This matter comes before the Court on Defendant's Motion for Summary Judgment (Doc. 36) and Defendant's Motion to Exclude or Limit the Testimony of Plaintiff's Expert, Evan Hendricks (Doc. 38). The motions are fully briefed, and the Court is prepared to rule. For the reasons explained more fully below, Defendant's Motion for Summary Judgment is granted and Defendant's Motion to Exclude or Limit the Testimony of Plaintiff's Expert Evan Hendricks is moot.

         I. Legal Standard

         Summary judgment is appropriate if the moving party demonstrates that there is no genuine dispute as to any material fact and that it is entitled to judgment as a matter of law.[2] In applying this standard, the court views the evidence and all reasonable inferences therefrom in the light most favorable to the nonmoving party.[3] “There is no genuine issue of material fact unless the evidence, construed in the light most favorable to the nonmoving party, is such that a reasonable jury could return a verdict for the nonmoving party.”[4] A fact is “material” if, under the applicable substantive law, it is “essential to the proper disposition of the claim.”[5] An issue of fact is “genuine” if “the evidence is such that a reasonable jury could return a verdict for the non-moving party.”[6]

         The moving party initially must show the absence of a genuine issue of material fact and entitlement to judgment as a matter of law.[7] In attempting to meet this standard, a movant that does not bear the ultimate burden of persuasion at trial need not negate the other party's claim; rather, the movant need simply point out to the court a lack of evidence for the other party on an essential element of that party's claim.[8]

         Once the movant has met this initial burden, the burden shifts to the nonmoving party to “set forth specific facts showing that there is a genuine issue for trial.”[9] The nonmoving party may not simply rest upon its pleadings to satisfy its burden.[10] Rather, the nonmoving party must “set forth specific facts that would be admissible in evidence in the event of trial from which a rational trier of fact could find for the nonmovant.”[11] To accomplish this, the facts “must be identified by reference to an affidavit, a deposition transcript, or a specific exhibit incorporated therein.”[12]

         Finally, summary judgment is not a “disfavored procedural shortcut;” on the contrary, it is an important procedure “designed to secure the just, speedy and inexpensive determination of every action.”[13]

         II. Factual Background

         The following facts are either uncontroverted, stipulated to, or viewed in the light most favorable to Plaintiff.

         A. Defendant Equifax and Its Procedures

          Defendant is a credit reporting agency as defined by the FCRA. In accordance with the FCRA, Defendant maintains detailed procedures to: (1) assure maximum possible accuracy of information it reports to its subscribers regarding consumers, (2) conduct reasonable reinvestigations to determine whether disputed information is inaccurate, and (3) limit the furnishing of consumer reports to persons which it has reason to believe has a permissible purpose.

         Defendant initially creates consumer credit files by using identifying information that it receives from a data furnisher. Defendant may make changes to a consumer's file as a result of three circumstances: (1) periodic batch processing of bulk data; (2) a data furnisher's out-of-cycle update to address circumstances or changes specific to individual consumers; or (3) through the application of business rules in accordance with federal and state law, or in accordance with internal Equifax business policies (e.g. the deletion of derogatory information after seven years per federal law).

         Defendant's processing of bulk data-which contains information regarding numerous consumers from a single data furnisher-results in the vast majority of updates to consumer credit files. On a monthly basis, Defendant processes approximately 1.2 billion bulk data updates from thousands of data furnishers. Before bulk data is uploaded into Defendant's consumer database, it is subjected to a variety of tests designed to determine the data's integrity and overall quality, and to standardize updates to the format used by Defendant. This process is referred to as “data quality assurance.” Defendant subjects the data to quality assurance, and then uploads the data to its consumer database, which processes the data using a sophisticated and proprietary algorithm that matches new information to existing consumer credit files. If no credit file exists, Defendant creates a new file for the consumer. This process is known as the “Search/Match Process.” Defendant uses the same Search/Match process when a creditor-or some other entity with a permissible purpose for obtaining a credit report-requests a credit report. Defendant also uses this process when consumer-service agents assist consumers making disputes. Defendant uses this sophisticated process to match consumer information for several reasons: there are variations in identifying information provided by furnishers and creditors; there are variations in identifying information provided by consumers; and there are inevitable human errors in the data-entry process.

         The Search/Match Process uses thirteen elements of personal identifying information, and all 8, 192 possible combinations of those elements, to arrive at a match. The elements are (in no particular order): (1) last name; (2) first name; (3) middle name or initial; (4) suffix, such as Jr. or Sr.; (5) gender; (6) street number; (7) street name; (8) date of birth; (9) city and zip code; (10) Social Security number “equal”; (11) Social Security number “maybe”; (12) age; and (13) account number. Defendant uses all thirteen elements to assess the quality of a match; it performs a calculation of matched elements versus mismatched elements versus missing elements. Defendant will not consider information to be a match unless there are at least three “strong” pieces of matching information. Defendant assesses strength using a comparison control table that assigns a numerical value to the various possible element combinations.

         A Social Security number is a “strong” piece of matching information because each number is generally assigned to only one individual, who keeps that number for life. A Social Security number is also a private piece of information that is usually not widely known to persons other than the Social Security number holder. Not all data furnishers and credit-report users, however, provide a Social Security number. Defendant does not require an exact match of all nine digits of a Social Security number before matching an account to a consumer's credit file. Defendant considers “maybe” matches when eight of nine digits match, and in some cases, when seven of nine digits match. It does so because it is not unusual for Social Security numbers to be transcribed incorrectly (such as mistaking a “4” for a “9”) or for numbers to be inadvertently transposed (such as “96” rather than “69”).

         Defendant also does not require an exact match of all other available elements because the personal circumstances of consumers can change. For example, consumers can change their names (e.g. through marriage or divorce), and move to new locations, both near or far. Consumers may also use more than one address (e.g. a home street address and a post office box or office address) and may use a nickname or middle name for some purpose and a first name for other purposes. Unintentional misspelling or miskeying of consumer information further complicates the match process. Many common names, for example, have more than one spelling. Address numbers and dates of birth are also prone to the same transcription errors described above with Social Security numbers. Consumers may also purposely use an incorrect date of birth.

         If Defendant were to require an exact match of all consumer information, Defendant would then possess “fragmented files.” Fragmented files come about when information regarding a single consumer ends up in multiple files. If Defendant required exact matches of all or some of the elements, it would not be able to combine any of the multiple files, which would leave Defendant (and creditors) without a complete picture of the consumer's credit history. This would reduce the reliability of consumer reports and ultimately hurt consumers.

         On the other hand, a matching process that allows for too many variations in matching elements can lead to the opposite problem known as “mixed files.” File mixing occurs when information belonging to two consumers is combined into a single consumer file. Given the fluctuations in consumer information described above and the inevitable human errors associated with data input, a perfect file-matching process is not possible. The goal, rather, is to keep the number of mixed and fragmented files at a minimum and to develop processes for correcting mixed and fragmented files when they occur.

         B. Plaintiff's File Combined With Angela Bierman-Bogart's File

         Plaintiff (formerly known as Angela Miles) and Angela Bierman-Bogart (formerly known as Angela Bierman) both reside in Kansas and have social security numbers that match on eight out of nine digits.[14] In July 2004, the name Angela P. Anderson-Miles became associated with the credit file for Angela Bierman-Bogart. The source of the information was a new Chase account posted to the Angela Bierman-Bogart file.

         In September 2004, as part of a quarterly update, Defendant's computer merged the two files into one because of the matching name, state of residence, and almost identical social security numbers. Defendant has changed its online combine procedures since September 2004, and the merge of the two files would not happen today. Defendant flags a Social Security number as a “verified” Social Security number when it is reported to Defendant on three or more independent updates from data providers. The updated matching rules no longer allow two files with verified Social Security numbers that differ to combine.

         In March 2005, Plaintiff first discovered that her credit file information was mixed with Angela Bierman-Bogart's information when she refinanced her mortgage. Plaintiff obtained a trimerge[15] mortgage credit report on March 10, 2005, that contained information regarding Angela Bierman-Bogart. Plaintiff alleges that an Equifax representative told her at that time that “there was a glitch in the computer, ” that she was merged with an Angela Bogart, ” and that she had “multiple files.” Anderson does not have any notes or recordings of that conversation and does not remember the name of anyone she spoke to or the exact date of that conversation.

         Plaintiff's credit file was not owned by Defendant until December 2012, but rather was owned by another consumer reporting agency, CSC Credit Services, Inc. (“CSC”), that stored its information in Defendant's database. Defendant did not acquire CSC until December 2012. Plaintiff claims that she disputed the information with Defendant in writing in the March 2005 timeframe, but does not have a copy of that correspondence. On January 24, 2006, Anderson contacted CSC, not Equifax, to dispute information. Defendant does not maintain records of disputes for more than five years.

         On February 13, 2006, Plaintiff obtained a disclosure from CSC that included information that belonged to Angela Bierman-Bogart. On June 29, 2011, Anderson obtained a credit report through Capital One, and it included accounts on her Equifax report that did not belong to her.

         C. Plaintiff's Contacts With Defendant

         Since 2004, Plaintiff claims she has pled with Defendant (or CSC) to fix her credit report. In the last five to six years, Plaintiff has been blocked from receiving her own Equifax credit report because she was unable to answer Angela Bierman-Bogart's security questions. When Plaintiff called Defendant to fix the issue, she was told they could not help her over the phone because she could not prove her own identity. Plaintiff could not access her credit report online, and therefore had difficulty disputing the items on her credit report.

         Around June 2011, Plaintiff subscribed to Capital One's credit monitoring service in the hope of potentially fixing the mixed credit file problem with Defendant. In late 2011, Defendant stopped providing the reports to Capital One. In 2013, Capital One ended the service and stopped helping fix the merged credit file.[16] Plaintiff did not know what steps to take at that point to fix the report since all of her previous attempts had failed.

         In 2015, Plaintiff learned that new false accounts and information had begun appearing in her Equifax credit reports. Plaintiff learned this during the process of refinancing her mortgage through Citibank. Because Plaintiff's file was mixed, Angela Bierman-Bogart's debts were showing up on Plaintiff's credit report. Plaintiff's August 31, 2015 credit report included a Barclays Bank Delaware account (opened in March 7, 2014), a Bennington State Bank account (opened in July 10, 2014), a Citicards CBNA account (opened in January 9, 2014), and an address at 520 South 19th Street Salina, Kansas 67401 (reported in August 2015).

         Plaintiff disputed these newly appearing accounts and information in 2015. Plaintiff claims that throughout 2015 she “repeatedly wrote” to Defendant asking it to correct her report so that she could qualify for a mortgage. Plaintiff also claims that she called Defendant six to seven times between August 2015 and November 2015. Plaintiff does not have records of most of the contacts. Plaintiff has no copies of any letters that she mailed to Defendant.

         Plaintiff submitted a refinancing application to Citibank for her mortgage on or around August 17, 2015. Even though Plaintiff was an existing Citibank customer, she had to explain that her credit file was mixed with Angela Bierman-Bogart's file. On August 17, 2015, Plaintiff called Citibank to discuss refinancing her mortgage and spoke to Waymon Williams. Plaintiff explained the situation with her Equifax report.[17] Over the weekend of August 21, 2015, Plaintiff received a “welcome” packet in the mail from Citibank that contained a mortgage application and the credit files they obtained from three credit bureaus.[18] Once again it showed that Defendant was reporting Angela Bierman-Bogart's personal information and credit on Plaintiff's credit report.

         On August 21, 2015, Plaintiff called Defendant and spoke to Defendant's associate named Orlando, who told her that he did not know anything about a refinance or Citibank's request for an Equifax credit report. Plaintiff explained the merged credit file situation to Orlando. Orlando tried to walk her through the merged credit report line-by-line, which took nearly a half an hour. Plaintiff disputed what she could over the phone, but she could not dispute each item as Orlando would not give her any specifics due to security issues.

         On August 24, 2015, Plaintiff called Defendant again. The representative she spoke to over the phone was argumentative and kept telling Plaintiff that her name was Angela Bogart and that she was not Angela Anderson. Plaintiff also tried to explain to her the merged file history leading up to that phone conversation. The representative told Plaintiff that she didn't have a record of the dispute or Plaintiff's conversation with Orlando. The representative told Plaintiff she needed to fax a copy of her driver's license and social security card to 888-826-0573. This call lasted approximately ten to fifteen minutes. The phone conversation and lack of knowledge of recent disputes concerned Plaintiff. She was worried about the ability to refinance her house, so Plaintiff again reached out to Citibank employee Waymon Williams.[19]

         On August 26, 2015, Defendant received a fax from Plaintiff related to her August 21 phone call. In the faxed letter, Plaintiff did not dispute any specific accounts. She only stated that she attached proof of her ID to add to her August 21 phone dispute: “I am sending to you a copy of my social security card and driver's license as requested from a phone conversation that I had with one of your associates . . . .”[20] During this process, Plaintiff spoke to Waymon Williams about her options regarding attempted refinancing.[21]

         On September 4, 2015, Plaintiff went to Defendant's “online dispute” website to find out the status of her dispute. After entering her information, Plaintiff got the message: “The information you provided does not match our records so we are unable to process your request online. Please FAX your dispute and a copy of your driver's license to 888-826-0549.” Defendant received another fax from Plaintiff on September 4, 2015, and started its second reinvestigation. Plaintiff's fax stated that she was “sending a copy of her social security card and driver's license, as requested from your website when I tried to get an update on my dispute claim which was faxed . . . on August 26, 2015.”[22] The fax stated she disputed six accounts and three pieces of ID information. Defendant opened an ACIS case.

         On September 9, 2015, Plaintiff received a 54-page credit report dated August 31, 2015. Defendant replaced Plaintiff's information with Angela Bierman-Bogart's information. Defendant deleted her Citibank mortgage, but other false accounts remained. On September 10, 2015, Plaintiff called Defendant. She explained that she had sent numerous copies of identification and faxed letters and had just received a report in the mail and Defendant had made her merged credit file worse. The representative commented to Plaintiff that they only received Plaintiff's fax dated September 4, 2015, and had no record of a dispute before that date. Plaintiff told her that she did not think that was true since the credit report was date August 31, 2015. The representative put Plaintiff on hold several times and told her she would be transferred to the escalation department, but she then told Plaintiff that they could not speak with her on the phone and they would continue investigating the dispute. Plaintiff needed to close on her refinance in mid-October. The representative told Ms. Anderson that it could take longer to investigate the dispute. The phone call had already lasted for 45 minutes.

         On September 12, 2015, Defendant completed reinvestigation on the first dispute from August 21. Defendant reinvestigated eighteen accounts, deleted seven accounts, and verified eleven accounts. On or about September 14, 2015, before Defendant completed its second reinvestigation, Angela Bierman-Bogart also contacted Defendant. On or about September 14, 2015, Defendant's agent separated the files and created a new file for Angela Bierman-Bogart. She also moved the six disputed accounts to that file. At the time that Defendant completed the maintenance of separating the two files, five accounts remained on Plaintiff's file that did not belong to her and one incorrect address.

         On October 7, 2015, Plaintiff checked Defendant's “online dispute” website for the new case number Defendant provided on September 10, 2015. The website stated that the case was opened on September 4, was completed on October 6, and the results had already been put in the mail. Plaintiff called Defendant on October 15, 2015. She was told her credit file was not masked and “a lot of things are still under investigation.” Defendant had no record of the dispute being completed or mailed.

         October 7 was the last interaction Plaintiff had with Defendant. Plaintiff never received verification via email or postal mail that showed Defendant completed the dispute or corrected her credit report. Plaintiff did not know her Equifax credit file had supposedly been corrected until she gave her deposition for this case in the fall of 2016-about nine months after the filing of this lawsuit-when Defendant's attorney represented that her credit report had been corrected.

         During the five years preceding the filing of the Complaint on January 19, 2016, Defendant claims Plaintiff only actually made the telephonic dispute on August 21 and the faxes related to that call on August 26 and September 4.

         D. Chase Home Lending Inquiry

         The inquiry section of Plaintiff's August 31, 2015 credit report showed that Defendant provided information to “Chase Home Lending” for an “account review” on August 18, 2015. Plaintiff did not have an account with Chase Home Lending which would need to be reviewed. The inquiry section of her credit report is separated into two sections. The upper section lists hard inquiries-companies that request a credit file with whom the consumer has applied for a loan or credit. The lower section lists soft inquires-inquiries which display only to the consumer and are not considered when evaluating credit worthiness for example requests from employers, companies making promotional offers and a consumer's own request to check credit. The “Chase Home Lending” account review was listed in the soft inquiry section. The only information provided to Chase Home Lending on the inquiry dated August 18, 2015 was the consumer's name and address and that Defendant's customer made a mortgage inquiry on her file on August 17, 2015.

         E. Plaintiff's Damages

         Plaintiff seeks actual, statutory, and punitive damages from Defendant. In December 2008, Plaintiff sought an auto loan with Credit Union of Johnson County, now Main Street Credit Union, but was denied because of accounts that did not belong to her. Plaintiff obtained the car loan with her soon to be ex-husband as a co-signer.

         In the fall of 2013, she was denied a loan of approximately $2, 500 to $3, 800 for the purchase of an air conditioner. Plaintiff has no documents related to the application and did not see an Equifax credit report provided on this application, but she believes that the denial was based on an Equifax credit report.

         In April 2014, she was denied an Amazon credit card by Chase Bank. Chase Bank obtained Defendant's credit information exclusively from Defendant.[23] Plaintiff intended to use the credit to purchase textbooks. Plaintiff admits that she was able to obtain the textbooks through other means.

         Defendant caused her to be delayed in a mortgage refinance application with Citibank. Defendant claims that she refinanced in the fall of 2015 to lower her interest rate and because her ex-husband demanded to be removed from the loan. She began the refinancing process in August 2015. While refinancing, she was constantly worried about the Equifax situation. Plaintiff spent less time with her children, her sleeping and eating patterns were disrupted, and the quality of her work was affected and compromised. The stress caused by the Citibank refinance caused her to break out in hives all over her body, and angioderma caused her face, tongue, and abdomen to swell in November 2015. She ultimately received refinancing in November 2015. Plaintiff obtained the best available interest rate.[24]

         Plaintiff states that the basis for her claim for punitive damages is that she felt like Defendant did not do anything despite her calls and letters, admitted there was an issue of a merged file and a computer glitch, and then either failed to respond or removed incorrect information when she faxed letters.

         III. Discussion

         A. FCRA Provisions

         This case concerns three substantive provisions of the FRCA-15 U.S.C. § 1681b(a), 15 U.S.C. § 1681e(b), and 15 U.S.C. § 1681i-as well as the FRCA's statute of limitations and statute of repose-15 U.S.C. § 1681p.

         Section 1681e(b) concerns a credit reporting agency's obligation to follow reasonable procedures to assure maximum accuracy in credit reporting. In relevant part, it states that “[w]henever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report ...

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