United States District Court, N.D. Illinois, Eastern Division
TAWANDA R. CAUSAY, Plaintiff,
WELLS FARGO BANK, N.A. and EQUIFAX INFORMATION SERVICES, LLC, Defendants.
MEMORANDUM OPINION AND ORDER
Robert Blakey, United States District Judge
Tawanda R. Causay (“Plaintiff”) alleges that
Defendant Wells Fargo Bank, N.A. (“Wells Fargo”
or “Defendant”) violated the Fair Credit
Reporting Act (“FCRA”), 15 U.S.C. § 1681,
et seq., by failing to correct false information it
furnished to credit reporting agencies. Compl. . Plaintiff
also raises state law claims of defamation and breach of
September 19, 2016, Defendant filed a motion to dismiss
Plaintiff's defamation claim (Count I) pursuant Federal
Rule of Civil Procedure 12(b)(6), as well as a motion to
strike a portion of Plaintiff's breach of contract claim
(Count IV) pursuant to Rule 12(f), on the grounds that
Plaintiff's state law claims are preempted by the FCRA.
Def.'s Mot. Dismiss & Strike . For the reasons
explained below, Defendant's motion is granted as to
Count I and denied as to Count IV.
The Deed in Lieu of Foreclosure
Complaint sets forth the following relevant facts, which the
Court accepts as true for the purposes of Defendant's
motions. On April 12, 2007, Plaintiff executed a mortgage for
her Chicago condominium. Compl.  ¶ 20. On September
10, 2010, the mortgage was assigned to Defendant.
Id. ¶¶ 10, 21. On November 16, 2012,
Plaintiff and Defendant entered into an agreement entitled
“Deed in Lieu of Foreclosure” (“Deed in
Lieu”), which, according to Plaintiff, consisted
“of a set of promises.” Id. ¶¶
22-23, Ex. 1. Specifically, in exchange for conveying her
interest in the property to Defendant, Defendant agreed to
pay Plaintiff $121, 181.40 and “forever forebear taking
any action whatsoever to collect” against Plaintiff on
the obligations “secured by the mortgage/deed of
trust.” Id. ¶¶ 24, 26 (quoting
Compl.  Ex. 1) (emphasis removed). As additional
consideration, Wells Fargo waived “its right to bring
an action” against Plaintiff “based on the
promissory note secured by the mortgage” and agreed
“not to name” Plaintiff “as a party to a
foreclosure action.” Id. ¶ 25, Ex. 1.
Wells Fargo's Collection Attempts and Credit
contends that Wells Fargo repeatedly breached the Deed in
Lieu by attempting to collect on the “nonexistent
mortgage” after she conveyed her interest in the
property to the Bank. Id. ¶¶ 84-85.
Plaintiff alleges that, over a three-year period, Wells Fargo
attempted to collect on the loan by sending form collection
letters and placing telephone calls to Plaintiff.
Id. ¶¶ 30-33, 38.
multiple occasions during this time period, Plaintiff
informed Defendant that the Deed in Lieu had been executed.
Id. ¶ 34. For example, on November 23, 2014,
Plaintiff informed Defendant that she no longer owned the
property and requested that Defendant cease all
communication. Id. ¶ 45. On December 5, 2014,
Defendant sent Plaintiff a letter confirming her request.
Id. ¶ 46, Ex. 2. Defendant's confirmation,
however, also stated that Defendant was “in the process
of moving forward with the foreclosure referral and
process.” Id. ¶¶ 46-47, Ex. 2.
Moreover, despite Plaintiff's request, Defendant
continued to send collection letters and make collection
calls. Id. ¶¶ 32-33, 56.
addition to contacting Plaintiff, Defendant also falsely
reported to credit reporting agencies that Plaintiff's
mortgage account was in default. Id. ¶¶
29, 48. In April 2014, Plaintiff disputed the inaccuracy with
Equifax Information Services, LLC (“Equifax”)-the
other named defendant in this suit-and indicated that she was
no longer liable for the mortgage account. Id.
¶ 35. Although Equifax informed Defendant of the
dispute, Defendant continued to report to credit reporting
agencies that the loan on Plaintiff's property was in
default. Id. ¶¶ 36, 39. On February 3,
2015, Plaintiff's credit report still listed the
non-existent Wells Fargo mortgage as delinquent. Id.
The Present Litigation
20, 2016, Plaintiff filed a five-count class action complaint
in this Court. Compl. . Plaintiff brings state law claims
for defamation (Count I) and breach of contract (Count IV),
asserts violations of two federal statutes, the FCRA (Counts
II and III) and Telephone Consumer Protection Act, 47 U.S.C.
§ 227 (Count V). Id. Defendant's motions
relate only to Plaintiff's state law claims.
Count I, Plaintiff alleges that, on multiple occasions,
Defendant “published misrepresentations” about
the status of her mortgage account to various credit
reporting agencies, including TransUnion, Equifax, and
Experian, and “through these entities to all of
Plaintiff's potential lenders.” Id. ¶
63. Plaintiff contends that these misrepresentations
constituted “defamations” made “with legal
malice and a willful intent to injure Plaintiff by placing
derogatory credit information on her credit reports as
punishment for what Defendant believed was a failure to
pay.” Id. ¶ 64. In Count IV, Plaintiff
alleges that Defendant breached the Deed in Lieu by
continuing collection attempts against Plaintiff and
incorrectly reporting to credit reporting agencies that her
account was delinquent. Id. ¶¶ 84-86.
argues that Plaintiff's state law claims are preempted by
the FCRA to the extent they are based upon Defendant's
credit furnishing activities. Def.'s Mem. Supp. Mot.
Dismiss & Strike  1. Accordingly, Defendant asserts
that this Court should dismiss Plaintiff's defamation
claim and strike the portion of Plaintiff's breach of
contract claim that is based on Wells Fargo's alleged
improper reporting. Id.