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Nicholas Martin v. Asset Acceptance

July 25, 2012


The opinion of the court was delivered by: No. 11 CV 6256


Plaintiff Nicholas Martin brings this putative class action against Asset Acceptance, LLC ("Asset"), an Illinois Limited Liability Corporation, for violations of the Fair Credit Reporting Act ("FCRA") and the Telephone Consumer Protection Act ("TCPA"). The parties have reached settlement on the TCPA claims. Asset now moves to dismiss the remaining FCRA claims pursuant to FRCP 12(b)(6).

For the reasons to follow, the motion to dismiss is granted in part and denied in part.


On October 7, 2008, Plaintiff Nicholas Martin paid off a $397 debt to Defendant Asset Acceptance, LLC for purchases made from a retail clothing store. Martin disputes whether Asset ever actually had good title to the debt. The debt was paid in full with a $0 balance owing at the end of October 2008. Since paying off his debt, Martin has had no other dealings with Asset.

In March of 2011, Asset obtained detailed credit information about Martin from Trans Union, LLC, a consumer reporting agency ("CRA") as defined by 15 U.S.C. § 1681a, in order to develop a predictive model to evaluate "consumer credit information received and used pursuant to the Service Agreements entered into with Trans Union." In order to access a consumer report in accordance with the FCRA, Asset must have a permissible purpose and that purpose must also be certified pursuant to § 1681e. Asset's two stated permissible purposes for accessing Martin's credit information are for account review and for assessing existing credit obligations pursuant to § 1681b(a)(3).

On January 18, 2012, Martin filed an amended complaint naming Asset Acceptance, LLC as the sole defendant.*fn1 The complaint alleges two FCRA violations: 1) Asset lacked a permissible purpose to access Martin's consumer report under § 1681b(f)(1) and 2) Asset's purpose was not certified pursuant to § 1681b(f)(2). Whether Asset actually had a permissible purpose for retrieving Martin's credit information and whether Asset's purpose was certified pursuant to the FCRA are factual disputes that cannot be decided at the motion to dismiss stage.


Defendant moves to dismiss Plaintiff's complaint pursuant to Fed. R. Civ. P. 12(b)(6) for failure to state a claim upon which relief can be granted. In order to survive such a motion, a plaintiff's complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). In considering a motion to dismiss for failure to state claim, the court treats all well-pleaded allegations as true, and draws all reasonable inferences in plaintiff's favor. Justice v. Town of Cicero, 577 F.3d 768, 771 (7th Cir. 2009). The plaintiff need not plead particularized facts, but the factual allegations in the complaint must be enough to raise a right to relief above the speculative level and provide the defendant with "fair notice of what the . claim is and the grounds upon which it rests." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). In other words, the plaintiff must plead facts that, when accepted as true, show the plausibility of its claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).


The FCRA was enacted to promote the equitable use of consumer credit information and to ensure fairness and accuracy within the credit reporting system. 15 U.S.C. § 1681. Section 1681b of the FCRA lays out the permissible purposes for which a person may use or obtain another individual's consumer report. When a violation of 1681b occurs, a plaintiff may base his allegations on negligent noncompliance (§ 1681o) and/or willful noncompliance (§ 1681n) of § 1681b.

A. Counts I and II: Plaintiff's allegations that Asset negligently violated §§ 1681b(f)(1) and 1681b(f)(2)

Any individual or entity that negligently violates any requirement of the FCRA will be liable for any actual damages sustained by the consumer as a result of the violation. 15 U.S.C. § 1681o(a). Actual damages "are real, substantial and just damages, or the amount awarded to a complainant in compensation for his actual and real loss or injury." Black's Law Dictionary 467 (rev. 4th ed.1968). Both the Supreme Court and the Seventh Circuit have defined "actual damages" as the term pertains to the FCRA to include both pecuniary and non-pecuniary damages. F.A.A. v. Cooper, 132 S. Ct. 1441, 1449 (2012); Ruffin-Thompkins v. Experian Info. Solutions, Inc., 422 F.3d 603, 609 (7th Cir. 2005). However, the Seventh Circuit has "maintained a strict standard for a finding of emotional damage because they are so easy to manufacture."

Ruffin-Thompkins, 422 F.3d at 609 (quoting Sarver v. Experian Info. Solutions, 390 F.3d ...

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