United States District Court, D. Nevada
RUSSELL K. UEHARA, Plaintiff,
TD BANK, NATIONAL ASSOCIATION A/K/A TD BANK USA/ TARGET CREDIT; EQUIFAX INFORMATION SERVICES, LLC; EXPERIAN INFORMATION SOLUTIONS, INC.; SPECIALIZED LOAN SERVICING, LLC, Defendants.
M. Navarro, Chief Judge
before the Court is the Motion to Dismiss, (ECF No. 23),
filed by Defendant Specialized Loan Servicing
(“Defendant”). Plaintiff Russel Uehara
(“Plaintiff”) filed a Response, (ECF No. 26), and
Defendant filed a Reply, (ECF No. 27). For the reasons set
forth herein, Defendant's Motion to Dismiss is
instant action arises from a dispute regarding the accuracy
of information reported on Plaintiff's credit report.
(Am. Compl. ¶ 3, ECF No. 4). On March 29, 2010,
Plaintiff filed for Chapter 13 bankruptcy. (Id.
¶ 16). Subsequently, Plaintiff made all payments
required under the finalized bankruptcy terms. (Id.
¶ 18). On July 28, 2015, the bankruptcy discharged any
debt owed to applicable defendants. (Id. ¶ 20).
Plaintiff alleges that following the discharge of his debts,
creditors and credit reporting agencies reported inaccurate
information on Plaintiff's credit report in violation of
the Federal Credit Reporting Act (“FCRA”) and the
Metro 2 industry reporting guidelines. (Id.
¶¶ 6, 25). Specifically, Plaintiff alleges that on
October 26, 2015, Defendant inaccurately reported to
Experian, a credit reporting agency, that Plaintiff owed a
balloon payment of $38, 964 due on April 24, 2036.
(Id. ¶ 59). Additionally, Plaintiff alleges
that Defendant, a furnisher of consumer information under the
FCRA, misleadingly reported that Plaintiff's account was
“transferred to recovery.” (Id. ¶
60, 71). On January 19, 2016, Plaintiff disputed
Defendant's reports by notifying Experian in writing.
(Id. ¶ 61). On February 1, 2016, Plaintiff
received notice that Experian and Defendant were notified of
the dispute. (Id. ¶ 65). The notice went on to
verify that the account had been updated. (Id.). The
updated report stated that Plaintiff had a “recent
balance” of zero dollars “as of Dec. 2015.”
(Id. ¶ 70). However, Plaintiff's Experian
credit report reflected no changes to the disputed
information. (Id. ¶ 69).
alleges that (1) Defendant failed to conduct a reasonable
investigation into the disputed information as required by
the FCRA; (2) that Defendant willfully furnished false
information in violation of the FCRA; and (3) Defendant
failed to update the furnished information to reflect that
Plaintiff's debt was discharged through bankruptcy.
(Id. ¶¶ 67, 72, 77). Consequently,
Plaintiff claims he “suffered actual damages, including
without limitation credit denials, fear of credit denials,
out-of-pocket expenses in challenging the Defendants'
wrongful representations, damage to his creditworthiness, and
emotional distress.” (Id. ¶ 78). Based on
these allegations Plaintiff asserts a single cause of action
for a violation of the FCRA under 15 U.S.C. § 1681.
(Id. ¶¶ 96-99). In the instant Motion,
Defendant seeks to dismiss Plaintiff's Amended Complaint
with prejudice. (Mot. to Dismiss 9:5, ECF No. 23).
is appropriate under Rule 12(b)(6) where a pleader fails to
state a claim upon which relief can be granted. Fed.R.Civ.P.
12(b)(6); Bell Atl. Corp. v. Twombly, 550 U.S. 544,
555 (2007). A pleading must give fair notice of a legally
cognizable claim and the grounds on which it rests, and
although a court must take all factual allegations as true,
legal conclusions couched as a factual allegations are
insufficient. Twombly, 550 U.S. at 555. Accordingly,
Rule 12(b)(6) requires “more than labels and
conclusions, and a formulaic recitation of the elements of a
cause of action will not do.” Id. “To
survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 570). “A claim has facial
plausibility when the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.”
Id. This standard “asks for more than a sheer
possibility that a defendant has acted unlawfully.”
court grants a motion to dismiss for failure to state a
claim, leave to amend should be granted unless it is clear
that the deficiencies of the complaint cannot be cured by
amendment. DeSoto v. Yellow Freight Sys. Inc., 957
F.2d 655, 658 (9th Cir. 1992). Pursuant to Rule 15(a), the
court should “freely” give leave to amend
“when justice so requires, ” and in the absence
of a reason such as “undue delay, bad faith or dilatory
motive on the part of the movant, repeated failure to cure
deficiencies by amendments previously allowed, undue
prejudice to the opposing party by virtue of allowance of the
amendment, futility of the amendment, etc.” Foman
v. Davis, 371 U.S. 178, 182 (1962).
instant Motion, Defendant argues that dismissal is proper
because Plaintiff lacks Article III standing. (Mot. to
Dismiss 8:11-14, ECF No. 23). Additionally, Defendant avers
that Plaintiff's Amended Complaint “fails to allege
sufficient plausible facts to state an FCRA claim.”
(Id. 4:14). Conversely, Plaintiff asserts that he
alleged an injury-in-fact sufficient for Article III standing
and alleged a cognizable FCRA claim. (Resp. 2:21-25, ECF No.
26). The Court will evaluate each argument in turn.
Article III Standing
irreducible constitutional minimum of standing” is
comprised of three elements: (1) The Plaintiff must have
suffered an “injury-in-fact, ” which is a
“concrete and particularized” invasion of a
legally protected interest; (2) there must be a “causal
connection” between the plaintiff's injury and the
defendant's action; and (3) it must be
“likely” that the plaintiff's injury will be
“redressed by a favorable decision.” Lujan v.
Defs. of Wildlife, 504 U.S. 555, 560 (1992) (quoting
Simon v. Eastern Ky. Welfare Rights Organization,
426 U.S. 26, 38-43 (1976)). “The party invoking federal
jurisdiction bears the burden of establishing these
elements.” Id. at 561.
instant motion, Defendant argues that under Supreme Court
precedent, Plaintiff lacks Article III standing for failure
to establish a “concrete injury.” (Mot. to
Dismiss 7:25-27, 8:1-13). To bolster this assertion,
Defendant primarily relies on the Supreme Court's ruling
in Spokeo, Inc. v. Robins, 136 S.Ct. 1540 (2016).
(Id.). Plaintiff rebukes Defendant's
interpretation of the Supreme Court's holding and argues
that he plead a sufficiently “concrete” injury
under Spokeo. (Resp. 15:10-23). For the following
reasons, the Court finds that Plaintiff pleads a
“concrete” injury sufficient to satisfy Article
III standing requirements.
Supreme Court's reasoning in Spokeo evaluated
the “injury-in-fact” requirement pursuant to an
alleged violation of the FCRA. Spokeo 136 S.Ct. at
1543. In Spokeo, the plaintiff alleged that the
defendant incorrectly reported the plaintiff's marital
status, age, employment status, education, and wealth level.
Spokeo, 136 S.Ct. at 1546. The Supreme Court
determined that a mere violation of an individual's
statutory rights under the FCRA without valuation of the
injury caused by the infraction is insufficient analysis into
the concreteness of Plaintiff's injury. Id. at
1548. “[N]ot all inaccuracies cause harm or present any
material risk of harm. An example that comes readily to mind
is an incorrect zip code. It is difficult to imagine how the
dissemination of an incorrect zip ...