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Waddell v. Experian Information Solutions, Inc.

United States District Court, D. Kansas

June 13, 2019




         This case comes before the court on Defendant Wells Fargo Dealer Services, Inc.'s[1](“Wells Fargo”) motion to dismiss the claims stated against it in Plaintiff's amended complaint (Doc. 35). The motion has been fully briefed and is ripe for decision. (Docs. 36, 43, 52.) Wells Fargo's motion is GRANTED for the reasons stated herein.

         I. Facts

         The following facts are taken from the allegations in Plaintiff's amended complaint. (Doc. 29.) In January 2017, Plaintiff applied for credit with Defendant KIA Motors America, Inc. (“KIA”) in order to purchase a vehicle at Lawrence KIA. There was also an unnamed co-borrower that was a party to the transaction. After reviewing the credit application, Plaintiff decided not to go through with the purchase of the vehicle. Allegedly, Defendant KIA funded the loan and directed Lawrence KIA to release the collateral to an unnamed co-borrower. Defendant KIA then sold or transferred the loan to Wells Fargo.

         Several months later, the unnamed co-borrower defaulted on the loan. Wells Fargo then reported negative marks on Plaintiff's credit report. After Plaintiff became aware of the sale transaction and the negative reporting, Plaintiff contacted Wells Fargo. Defendants Equifax, Experian, and TransUnion (the “Defendant credit reporting agencies”) had notice of the dispute and all promptly removed the negative reporting. Wells Fargo told Plaintiff that it would remove the negative reporting after an investigation.

         Plaintiff's credit score increased significantly after the removal. Shortly thereafter, the Defendant credit reporting agencies changed Plaintiff's credit report to again reflect the negative reporting. Plaintiff properly disputed the Wells Fargo negative reporting with each of the Defendant credit reporting agencies. Plaintiff disputed the negative reporting on at least two occasions. Wells Fargo continued to report incorrect information to the Defendant credit reporting agencies in an attempt to cause Plaintiff to make payments. Plaintiff alleges that Wells Fargo intentionally, recklessly, and negligently failed to perform a reasonable investigation as required by the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681, et seq. Plaintiff alleges that he has suffered damages as a result of Defendants' conduct and has been unable to obtain refinancing.

         Plaintiff has alleged two counts against Wells Fargo: violation of the FCRA and of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692e. Wells Fargo moves to dismiss both counts on the basis that they fail to state a claim.

         In response to Wells Fargo's motion, Plaintiff has filed a memorandum in opposition and attached two unauthenticated exhibits: the results of Plaintiff's credit dispute from Experian and a letter from Wells Fargo regarding Plaintiff's dispute. (Doc. 43, Exhs. 1, 2.) On a motion to dismiss, the court can only consider exhibits attached to the amended complaint or exhibits that were incorporated into the amended complaint by reference. See Smith v. United States, 561 F.3d 1090, 1098 (10th Cir. 2009). These exceptions are not applicable as the exhibits were not attached to the amended complaint and the exhibits are not incorporated into the amended complaint by reference. Therefore, because this is a motion to dismiss, the court declines to consider the exhibits in ruling on the motion. Brokers' Choice of Am., Inc. v. NBC Universal, Inc., 861 F.3d 1081, 1103 (10th Cir. 2017) (“When a party presents matters outside of the pleadings for consideration, as a general rule ‘the court must either exclude the material or treat the motion as one for summary judgment.'”) (citing Alexander v. Oklahoma, 382 F.3d 1206, 1214 (10th Cir. 2004)).

         II. Motion to Dismiss Standards

          In order to withstand a motion to dismiss for failure to state a claim, a complaint must contain enough allegations of fact to state a claim to relief that is plausible on its face. Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th Cir. 2008) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1974 (2007)). All well-pleaded facts and the reasonable inferences derived from those facts are viewed in the light most favorable to Plaintiff. Archuleta v. Wagner, 523 F.3d 1278, 1283 (10th Cir. 2008). Conclusory allegations, however, have no bearing upon the court's consideration. Shero v. City of Grove, Okla., 510 F.3d 1196, 1200 (10th Cir. 2007). Rule 12(b)(6) “does not require that Plaintiff establish a prima facie case in her complaint, but rather requires only that the Plaintiff allege enough factual allegations in the complaint to set forth a plausible claim.” Pueblo of Jemez v. United States, 790 F.3d 1143, 1171-72 (10th Cir. 2015) (internal citations omitted). In the end, the issue is not whether Plaintiff will ultimately prevail, but whether Plaintiff is entitled to offer evidence to support her claims. Beedle v. Wilson, 422 F.3d 1059, 1063 (10th Cir. 2005).

         III. Analysis

         a. FCRA Claim

         Plaintiff alleges that Wells Fargo engaged in willful and negligent noncompliance with 15 U.S.C. § 1681s-2(a) and (b) by refusing to conduct an investigation, refusing to review relevant information, failing to report accurate information, and continuing to furnish and disseminate inaccurate credit information to the agencies despite knowledge of the inaccuracies. Wells Fargo asserts that there is no private right of action under § 1681s-2(a) and that Plaintiff has not stated a claim under § 1681s-2(b).

         First, Wells Fargo argues that there is no private right of action under § 1681s-2(a), which requires furnishers of information to provide accurate information to consumer reporting agencies and to investigate a dispute once they have received notice of the dispute from the consumer reporting agency. Pinson v. Equifax Credit Info. Servs., Inc., 316 Fed.Appx. 744, 750 (10th Cir. 2009). Plaintiff's amended complaint attempts to state a claim under § 1681s-2(a). That section, however, “provides no private cause of action.” Id. at 751 (citing Gorman v. Wolpoff & Abramson, LLP, 552 F.3d 1008, 1014 (9th Cir. 2009) (“Duties imposed on furnishers under subsection (a) are enforceable only by federal or state agencies.”); Aklagi v. Nationscredit Fin., 196 F.Supp.2d 1186, ...

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