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Simpson v. Juniper Bank

February 8, 2007


The opinion of the court was delivered by: Judge Rebecca R. Pallmeyer


Carmencita Simpson ("Plaintiff") received a credit solicitation mailing from Juniper Bank ("Defendant") some time after March 17, 2005, informing her that, based on her credit record, she was "pre-qualified" for a Platinum MasterCard ("Juniper mailer"). (Compl. ¶¶ 6, Ex. A.) On behalf of herself and a class of individuals who received the same mailing, Plaintiff now claims that Defendant accessed her consumer report without her consent and in willful violation of the Fair Credit Reporting Act ("FRCA"), 15 U.S.C. § 1681 et seq. Specifically, Plaintiff claims that Defendant's mailing did not constitute a "firm offer of credit" within the meaning of 15 U.S.C. § 1681b(c)(1)(B)(i), and that Defendant's access to her credit report thus violates the FCRA. Defendant has moved to dismiss Plaintiff's complaint. For the reasons set forth below, Defendant's motion to dismiss is denied.


On a motion to dismiss, the court accepts all well-pleaded allegations as true. Shawnee Trail Conservancy v. U.S. Dep't of Agric., 222 F.3d 383, 385 (7th Cir. 2000). The court will consider the Juniper mailer, attached as an exhibit to Plaintiff's complaint, as part of the pleadings. Wright v. Assoc. Ins. Cos., Inc., 29 F.3d 1244, 1248 (7th Cir. 1994) ("Documents attached to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to his claim.")

1. Dissemination of the Juniper Mailer

Plaintiff alleges that Juniper Bank "approved and authorized" the dissemination of the Juniper mailer received by Plaintiff and over 200 other Illinois residents. (Compl. ¶¶ 14, 17.) Juniper Bank "engaged in or arranged for the 'prescreening' of consumers" to select the consumers that were to receive the Juniper mailer; these consumers were selected based on information in their consumer reports. (Id. ¶¶ 9-10.)*fn1 The mailer advised Plaintiff that she was "selected for this offer because, based on [her] credit record maintained by credit bureaus, [she] met the criteria established for the offer." (Id. ¶¶ 7, Ex. A.) Plaintiff, however, never authorized Juniper Bank to access her consumer report, and Juniper Bank had no reason to believe that Plaintiff had given Juniper or its agents permission to access her consumer report or to use information contained in her consumer report. (Id. ¶¶ 18-19.) Although Plaintiff did not initiate any transaction with Juniper Bank after receiving the mailer, Plaintiff alleges that Juniper Bank obtained business from others as a result of the mailer. (Id. ¶¶ 16, 20.)

2. Content of the Juniper Mailer

The Juniper mailer states that Plaintiff is "pre-qualified" for the Platinum Mastercard. (Id. ¶ Ex. A.) According to the mailer, the credit card offers "a generous credit line and valuable perks like Purchase Assurance, Travel Accident Insurance, and MasterRental Insurance" as well as "extra benefits like 100% fraud protection, regular credit line increase reviews and great super-saver discounts." (Id.) It further states that Plaintiff should "accept [her] card today-in just 30 seconds" and asks Plaintiff, "why wait to apply? You're pre-qualified." (Id.) Attached to the Juniper mailer is a "30-Second Pre-Qualified Reply Form" that requests additional information from Plaintiff, including her social security number, her gross annual household income, and whether she has a checking account. (Id.)

Also attached to the Juniper mailer is a statement of terms and conditions. The terms and conditions include: a variable Annual Percentage Rate ("APR") of 11.99%, 15.99%, or 18.99%, depending on a review of the applicant's reply form and credit history;*fn2 a variable APR for Balance Transfers and Convenience Checks of 11.99%, 15.99%, or 18.99%, again depending on a review of the applicant's reply form and credit history; no annual fee; and a minimum finance charge of $1.*fn3 (Id.) The terms and conditions also detail the rates for cash advances, the grace period applicable to purchases, the method of computing the balance for purchases, and the applicable transaction charges. (Id.) The default rate, which is listed as "up to 30.24% variable," remained to be determined on the basis of further information from the Plaintiff's account history and performance on other credit accounts. (Id.) Juniper Bank expressly reserved the right to change the APR described in the terms and conditions, and also reserved the right "to change at any time the benefits and features associated with the card or account." (Id.) The terms and conditions included in the Juniper mailer did not specify a minimum line of credit. (Id.)


Federal Rule of Civil Procedure 8(a) requires, in relevant part, that a complaint provide a "short and plain statement of the claim" to give the defendant "fair notice" of the plaintiff's claim and the grounds upon which it rests. FED. R. CIV. P. 8(a); Cler v. Illinois Educ. Ass'n, 423 F.3d 726, 725 (7th Cir. 2005) (citations and internal quotations omitted). On a motion to dismiss, the court accepts the complaint's well-pleaded allegations as true and draws all reasonable inferences in the plaintiff's favor. Cole v. U.S. Capital, Inc., 389 F.3d 719, 724 (7th Cir 2004). Dismissal is proper only if no set of facts, even hypothesized, would entitle the plaintiff to relief. Massey v. Merrill Lynch & Co., Inc., 464 F.3d 642, 645 (7th Cir. 2006); Cole, 389 F.3d at 724. Thus, a complaint will survive a 12(b)(6) motion to dismiss as long as it "narrates an intelligible grievance that, if proved, shows a legal entitlement to relief." U.S. Gypsum Co. v. Indiana Gas Co., 350 F.3d 623, 626 (7th Cir. 2003) (citations omitted).

Under the FCRA as it relates to this case, Juniper Bank was authorized to access Plaintiff's credit report only in connection with a "firm offer of credit." Defendant contends that Plaintiff's complaint fails to state a claim upon which relief can be granted because Juniper Bank's offer constituted a "firm offer of credit" under the FCRA. (Def. Mem. at 7-13.) Defendant further argues that Plaintiff has not sufficiently pleaded a willful violation of the FCRA. (Id. at 14.) Plaintiff responds that she has adequately alleged that Defendant did not make a "firm offer of credit" because the Juniper mailer included multiple sets of credit terms and, in Plaintiff's view, did not guarantee anything to Plaintiff. (Pl. Opp'n at 5-10.) Plaintiff also argues that her allegations are sufficient to establish willfulness. (Id. at 10-11.)

1. The Fair Credit Reporting Act

In order to protect consumers' privacy and maintain integrity with respect to information held by consumer reporting agencies, the FCRA prohibits credit agencies from sharing a consumer's credit report without the consumer's consent, unless the report is shared for one of the "permissible purposes" set forth in 15 U.S.C. § 1681b(a). See Cole, 389 F.3d at 729. Among the "permissible purposes" for which a credit provider can obtain a consumer's credit information from a credit bureau is when the provider is making a "firm offer of credit" to the consumer. 15 U.S.C. § 1861b(c)(1)(B)(i). A "firm offer of credit" is defined as an offer "that will be honored if the consumer is determined, based on the information in his or her consumer report, to meet the specific criteria used to select the consumer for the offer." Id. § 1681a(l). The offer may be conditioned on three specific requirements: 1) the creditor may apply pre-selected criteria relating to the consumer's creditworthiness; 2) the offer may be conditioned on verification that the consumer still meets the criteria used to initially select the consumer for the offer; and 3) the offer may be conditioned on the consumer furnishing ...

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