SAMOURA v. TRANS UNION LLC ( 2021 )

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA FATOUMATA SAMOURA : CIVIL ACTION : v. : NO. 20-5178 : TRANS UNION LLC : MEMORANDUM KEARNEY, J. March 10, 2021 Fatoumata Samoura agreed to pay back four student loans to Fedloan beginning in 2008. She fell at least 120 days behind on her loan payments by July 2014. Fedloan transferred her four loans to a new creditor by March 2015. She thereafter owed nothing to Fedloan after it transferred her long overdue loans. Ms. Samoura received her credit report from Trans Union at some unplead later time. Her credit report of an unplead date referenced a zero-balance owed to Fedloan but a pay status of account 120 days past due date. Her lawyers disputed Trans Union’s reporting of the Fedloan obligation forty-two months after Fedloan transferred the loans. Her lawyers, as they did in Bibbs v. Trans Union LLC decided by us approximately two weeks ago, argue Trans Union’s report of her Fedloan debt is patently inaccurate or materially misleading under the Fair Credit Reporting Act. Under their reading, Ms. Samoura could not both have a zero-balance and a pay status of account 120 days past due even with the readily apparent close of the account upon transfer and graphic history of eight months of the loans due over 120 days before the identified transfer date. Ms. Samoura is mindful we already found this nearly identical language is not inaccurate or materially misleading in Bibbs. But her lawyers today cross-move for judgment as a matter of law to essentially ask us to reconsider Bibbs. They argue we erred in relying on inapposite cases, and we should liberally construe the Act in her favor and reserve questions of accuracy for the jury. We again studied our Bibbs analysis. We again find no amount of liberal construction can turn accurate reporting into a question of fact for the jury simply because the consumer concludes the reference is inaccurate or materially misleading. Ms. Samoura has a zero balance on loans 120 days past due when Fedloan closed her account. Both statements are accurate as confirmed by other references in the same report. Ms. Samoura does not plead she paid off the Fedloan accounts before transfer. We might have a different result if she did. As the parties cross-moved for judgment on the pleadings and even after viewing the facts in the light most favorable to Ms. Samoura, we grant Trans Union’s motion for judgment on the pleadings. We grant her leave to timely amend should she be able to plead a patently inaccurate or materially misleading statement based upon facts not presently plead. We deny Ms. Samoura’s cross-motion for judgment. I. Alleged undisputed facts Student loan provider Fedloan extended one student loan to Fatoumata Samoura in 2008 and three more in 2011.1 Ms. Samoura fell behind on her loan payments in early 2014.2 Each of Ms. Samoura’s loan accounts had been more than 120 days past due after July 2014.3 FedLoan transferred three of Ms. Samoura’s accounts on February 16, 2015 and another account on March 16, 2015.4 It transferred these four accounts to another lender, and thus Ms. Samoura no longer owed it money. Her account balance owed to FedLoan became $0.5 Ms. Samoura received a credit report from Trans Union LLC sometime years later at an unplead time and for an unplead reason. According to Ms. Samoura, the credit report at this unplead date listed the “Status” of her accounts as “Account 120 Days Past Due” but listed a $0 balance.6 Ms. Samoura’s attorney, who has now filed more than eighty complaints across the country alleging nearly identical facts, sent Trans Union a dispute letter on September 27, 2018 questioning the accuracy of her credit report and threatening to file a lawsuit if “this incorrect information is not removed or corrected.”’ He explained his dispute as, “it is impossible for [the loans’| current status to be listed as late” 1f Ms. Samoura owes Fedloan “no money and has no payments that are behind.”® Trans Union timely responded to Ms. Samoura’s attorney’s letter with the results of the investigation into her dispute.’ The investigation results displayed excerpts of how her account information “appears on [Ms. Samoura’s] credit report.”'° One of the four excerpts demonstrates: ER SREB RR MPR BRB BER SR RERBRSRSRE RBBB RBUOR RRR ORR Eee eee eee ese FEDLOAN SERVICING ‘EN FDO**** ( POR 60610, HARRISBURG, PA 17106, (800) 699-2908 ) We investigated the information you disputed and updated: Date Updated; Date Closed; Remarks; Rating. Here is how this item appears on your credit report following our investigation. Date Opened: 10/24/2011 Balance: $0 Pay Status: >Account 120 Days Past Responsibility: Individual Account Date Updated: 02/16/2015, Due Dates Account Type {Installment Account High Balance: $4,600 Terms: Monthly for 120 months Loan Type! STUDENT LOAN Date Closed: 02/16/2015 *Maximum Delinquency of 120 days in 06/2014 and In O2/2018 Account 120 Days Past Due Date Account 120 Days Past Due Date Account 120 Days Past Due Date Account 120 Days Past Due Account 120 Days Past Due Account 120 Days Past Due Date<”, ignore all other tradelines, and determine a reasonable creditor would mistakenly believe she currently owes past due payments on these accounts. We decline this invitation. Nearly every tradeline contains evidence Ms. Samoura owed FedLoan money in the past, failed to make timely payments throughout 2014 and into 2015, but has no continuing obligation to FedLoan. The “Date Updated” field lists February/ March 2015, signaling the “Pay Status” of the FedLoan accounts were 120 days past due as of February/March 2015. The Ratings Key, which does not provide data for the account past March 2015, further bolsters this conclusion. And if this were not enough, the Date Closed, the Balance, and the Remarks all unequivocally confirm the account is closed with a zero-dollar balance. Ms. Samoura is essentially asking us to read in non-existing present tense language into the “Pay Status” field and ignore the Date Updated field, the Date Closed field, the Balance field, the Remarks field, and the Ratings field to conclude Trans Union reported inaccurate or misleading information. This we cannot do. As the judges in Hernandez, Settles and Gross explained, we must view the account information given to the creditor in its entirety, and in doing so, conclude the reported information is accurate as a matter of law. Ms. Samoura’s attempts to distinguish Schweitzer, Settles, Hernandez, and Gross do not persuade us. Ms. Samoura argues Schweitzer is inapposite because our Court of Appeals decided Schweitzer on appeal from a motion for summary judgment, not a motion to dismiss or motion for judgment on the pleadings. The difference in procedural posture is immaterial here. The district court did not face the issue until summary judgment. In Schweitzer, the credit reporting agency did not move to dismiss or for judgment on the pleadings, but instead reserved its arguments for summary judgment.82 In determining the accuracy of the reported information, the Court of Appeals relied solely on the face of the reported account information and did not cite other discovery material.83 We today have the exact same information our Court of Appeals studied in Schweitzer at our disposal. Ms. Samoura also notes our Court of Appeals in Schweitzer analyzed the accuracy of the reporting on four accounts, including one account with EMC Mortgage and one account with Americredit.84 While our Court of Appeals determined the reporting of the EMC Mortgage account to be accurate as a matter of law, it determined a reasonable juror could conclude the credit reporting agency inaccurately reported the Americredit account.85 Again, this distinction is immaterial. The reporting of the Americredit account raised a genuine issue of material fact as to whether listing the “Current Status” as “Included in Bankruptcy” was inaccurate or materially misleading given the plaintiff’s allegations the Americredit account was not included in a bankruptcy.86 Our Court of Appeals’ ruling regarding the Americredit account has no bearing on whether a company may report the historical late pay status of a closed and transferred account. Ms. Samoura seeks to distinguish Settles and Hernandez, calling them “factually inapposite instantly – upon the pleaded averments.”87 But Ms. Samoura does not try to explain how Settles and Hernandez differ from her claim. Our review of the cases does not reveal any material distinctions. Ms. Samoura attacks the holding in Gross on the grounds Judge Cogan held, when it comes to the Fair Credit Reporting Act, “mere imprecision is not enough.”88 Ms. Samoura argues this line in Gross “is directly contrary to the in-Circuit cases already cited” without specifying which cases Judge Cogan contradicts. This argument does not persuade us.89 In Gross, Judge Cogan explained, “[b]ecause plaintiff does not seem to argue that the information is patently incorrect, he must point to information on his credit report that is ‘materially misleading’ to creditors.” 90 In describing the standard for “materially misleading,” he said “mere imprecision is not enough.”91 We do not find Judge Cogan’s description inconsistent with the law in this Circuit. In defining the “materially misleading” standard, our Court of Appeals has explained the information must be “misleading in such a way and to such an extent that [it] can be expected to have an adverse effect.”92 We find Judge Cogan’s “mere imprecision” language consistent with our Court of Appeals’ instruction information be materially misleading, not just misleading, to be actionable. Ms. Samoura asks us to reject the reasoning in Schweitzer, Hernandez, Settles, and Gross and embrace Huggins, Mund, Friedman, and Macik. Material distinctions prevent us from adopting the reasoning in her cited cases. In Huggins, Judge Salas determined she could not determine the accuracy of the account because the parties did not provide the disputed tradelines for her review. The same is true of the claims in Gatanas. Ms. Samoura and Trans Union provided the tradelines for our review. In Mund and Friedman, the credit report indicated the consumer still owed monthly payments. Ms. Samoura does not allege a similar defect in her credit report. In Macik, the consumer fully paid off her mortgage. Ms. Samoura does not allege she paid her accounts as of the transfer and close of her FedLoan accounts. Soler is the closest call. In Bibbs, we distinguished Soler because the consumer in Soler alleged she “fully satisfied” her accounts.93 We likened Soler to Macik and acknowledged consumers who paid off their accounts may have a stronger argument Trans Union inaccurately represents their credit history by listing “Account 120 Days Past Due” as their Pay Status.94 Ms. Samoura also alleges she “fully satisfied” her accounts. But the credit report excerpts attached to her Complaint and subject to our study confirm Ms. Samoura did not pay off her account like the consumer in Macik. Rather, like the consumers in Bibbs, Hernandez, Settles, and Gross, FedLoan transferred Ms. Samoura’s four overdue accounts to another lender and then closed the account. Neither Ms. Samoura nor the excerpts of her credit report offer contrary facts. We have no basis to find she paid off her overdue loans before FedLoan transferred them and closed her overdue accounts leaving her with a zero-balance owed to it. But in the event Ms. Samoura did, in fact, pay off her loans and Trans Union inaccurately reported them as “closed due to transfer,” we give Ms. Samoura leave to amend. III. Conclusion We grant judgment on the pleadings for Trans Union because it did not report inaccurate or materially misleading information which would mislead a creditor into making an adverse credit decision against Ms. Samoura. As our Court of Appeals directed in Schweitzer, we make this finding as a matter of law based on plead facts and the exhibits attached to and incorporated by reference in the Complaint. But we grant Ms. Samoura leave to timely file an amended complaint if the facts are different consistent with Rule 11.95 1 ECF Doc. No. 1-5 at 3. 2 Id. 3 Id. 4 Id. 5 Id. 6 ECF Doc. No. 1-4 at 2. 7 Id. 8 Id. 9 Id. ¶ 11; ECF Doc. No. 15 at 3. 10 Id. 11 Id. 12 Id. 13 Id. 14 Id. 15 Id. 16 Id. 17 Id. 18 Id. 19 ECF Doc. No. 1. 20 Id. ¶ 17. 21 ECF Doc. No. 1 ¶¶ 19, 20. 22 Id. ¶18. 23 ECF Doc. No. 1 ¶¶7-9. 24 Id. ¶ 34, 14, 27, 29. 25 “Under [Federal Rule of Civil Procedure] Rule 12(c), a court ‘must view the facts in the pleadings in the light most favorable to the plaintiff and must grant the motion only if the moving party establishes that no material issue of fact remains and that it is entitled to judgment as a matter of law.’” Citisteel USA, Inc. v. Gen. Elec. Co., 78 F. App’x 832, 835 (3d Cir. 2003) (quoting Shelly v. Johns-Manville Corp., 798 F.2d 93, 97 n.4 (1986)). 26 ECF Doc. No. 15 at 2. 27 Id. at 6–8. 28 No. 20-4514, 2021 WL 695112 (E.D. Pa. Feb. 23, 2021). 29 ECF Doc. No. 22 at 3. 30 Cortez, 617 F.3d 688, 707 (3d Cir. 2010). 31 Id. (quoting S.Rep. No. 91–517, at 1 (1969)). 32 Id. (quoting Guimond v. Trans Union Credit Information Co., 45 F.3d 1329 (9th Cir. 1995)). 33 Id. 34 Id. at 696. 35 Id. at 707. 36 Id. at 720-21. 37 Id. at 722. 38 See Schweitzer v. Equifax Info. Solns. LLC, 441 F. App’x 896, 902 (3d Cir. 2011) (alterations in original) (quoting Dalton v. Capital Associated Indus., Inc., 257 F.3d 409, 415 (4th Cir. 2001)). 39 Covington v. Equifax Info. Servs., Inc., No. 18-15640, 2019 WL 4254375, at *4 (D.N.J. Sept. 9, 2019) (quoting Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1163 (9th Cir. 2014)). 40 Id. 41 Id. at 900–01. 42 Id. at 902. 43 Id. 44 No. 20-4487, ECF Doc. No. 32 (Order) (E.D.Pa. March 5, 2021)(“While Parke argues that questions about the inaccurate or misleading quality of information are for the jury, the material facts asserted in the pleadings are not in dispute. After construing those facts in the light most favorable to Parke and drawing all inferences in his favor, the Court concludes as a matter of law that the reported information is neither inaccurate nor misleading.”). 45 Settles v. Trans Union LLC, No. 20-84, 2020 WL 6900302, at *1 (M.D. Tenn. Nov. 24, 2020). 46 Id. at * 4. 47 Id. at * 5. 48 Gross, 2021 WL 81465, at * 4. 49 Id. at * 1. 50 Id. 51 Id. at * 3. 52 Id. 53 Hernandez v. Trans Union, LLC, No. 19-1987, 2020 U.S. Dist. LEXIS 249358 (S.D. Fla. Dec. 10, 2020). 54 Id. at * 4. 55 Id. at * 3-4. 56 Id. at * 4-5. 57 Id. at * 8. 58 Id. at * 7. 59 No. 18-6761, 2019 WL 955033, at * 1 (E.D.N.Y. Jan. 9, 2021). 60 Id. at * 3. 61 Id. 62 Id. 63 2021 WL 81465 at *3. 64 No. 18-11173, 2019 WL 4194350, at * 1 (S.D.N.Y. Sept. 3, 2019). 65 Id. at * 3. 66 Huggins v. FedLoan Servicing, No. 19-21731, 2020 U.S. Dist. LEXIS 229290, *16 (D.N.J. Dec. 2, 2020) (citing Hillis v. Trans Union, LLC, 969 F. Supp. 2d 419, 421 (E.D. Pa. 2013)). 67 Id. at * 17-18. 68 Gatanas v. Honda, No. 20-7788, 2020 WL 7137854, at *1 (D.N.J. Dec. 7, 2020). 69 Id. 70 Id. at * 3. 71 Id. 72 Id. at * 4. 73 Ms. Samoura also cites Drexler v. Trans Union, LLC, No. 20-2366-30JSS, 2020 WL 8299761 (M.D. Fla. Dec. 15, 2020) and Hall v. Trans Union, Inc., No. 19-296, 2020 WL 70945 (E.D. Tex. Jan. 7, 2020). These earlier cases do not address the question of accuracy, but instead find Trans Union’s arguments to be premature at the pleading stage. We find we can opine on the accuracy of the report at this early stage because the parties provided the information, and counsel for both parties previously represented to us accuracy can be determined from the face of the investigation results. See Oral Argument Transcript, Bibbs v. Trans Union, No. 20-0415, ECF Doc. No. 44 (Feb. 19, 2021) (N.T. 4:21-24; 8:13-15). 74 Macik v. JPMorgan Chase Bank, N.A., No. G-14-44, 2015 WL 12999728, at * 1 (S.D. Tex. May 28, 2015), report and recommendation adopted by Macik v. Trans Union LLC, No. 14-44, 2015 WL 12999727 (S.D. Tex. July 31, 2015). 75 Id. 76 Id. at * 2. 77 Id. at * 4. 78 No. 20-8459, 2020 WL 7237256, at *1 (C.D. Cal. Dec. 1, 2020). 79 Id. 80 Id. at *3. 81 Id. 82 See Docket Sheet, Schweitzer v. Equifax, No. 08-478 (W.D.Pa.). 83 Schweitzer, 441 Fed. App’x at 902. 84 Id. at 891-902. 85 Id. at 902. 86 Id. 87 ECF Doc. No. 22 at 7. 88 Gross, 2021 WL 81465, at *2. 89 ECF Doc. No. 22 at 7. 90 Gross, 2021 WL 81465, at *2. 91 Id. 92 Schweitzer, 441 F. App’x at 902 (alterations in original) (quoting Dalton v. Capital Associated Indus., Inc., 257 F.3d 409, 415 (4th Cir. 2001)). 93 2021 WL 695112 at *8. 94 Id. 95 We trust Ms. Samoura’s experienced counsel in our Bar will timely advise both Trans Union’s counsel and us of its intent mindful of our collective reliance on the January 5, 2021 Order (ECF Doc. No. 13) setting trial obligations.