Pappas v. Experian Information Solutions, Inc.

          MEMORANDUM OPINION AND ORDER

          AMY J. ST. EVE, District Court Judge

         On June 30, 2016, Plaintiff Michael Robert Pappas brought a one-count First Amended Complaint against Experian Information Solutions, Inc. (“Experian”) for violating the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681, et seq. Before the Court are the parties' cross-motions for summary judgment brought pursuant to Federal Rule of Civil Procedure 56(a) and Northern District of Illinois Local 56.1. For the following reasons, the Court grants Defendant's motion for summary judgment and denies Plaintiff's motion for summary judgment. The Court dismisses this lawsuit in its entirety.

         FACTUAL BACKGROUND

         Plaintiff Michael Robert Pappas is an Illinois resident and a consumer as defined by the FCRA. (R. 103, Def.'s Rule 56.1 Stmt. Facts ¶ 1; R. 107, Pl.'s Rule 56.1 Stmt. Facts ¶ 1.) Experian is a credit reporting agency (“CRA”) as defined by the FCRA. (Def.'s Stmt. Facts ¶ 2.) Experian's business consists, in part, of compiling consumer credit information and providing that information to third parties. (Id.; Pl.'s Stmt. Facts ¶ 2.) Experian maintains credit information about Plaintiff. (Def.'s Stmt. Facts ¶ 2.)

         On April 27, 2013, Plaintiff filed a petition for Chapter 13 bankruptcy protection in the United States Bankruptcy Court for the Northern District of Illinois. (Def.'s Stmt. Facts ¶ 6; Pl.'s Stmt. Facts ¶ 8.) At that time, Plaintiff owned investment rental properties in Plano, Plainfield, and Diamond, Illinois. (Def.'s Stmt. Facts ¶ 6; Pl.'s Stmt. Facts ¶ 1.) U.S. Bank Home Mortgage (“U.S. Bank”) owned the mortgage loans and Cenlar Central Loan Administration (“Cenlar”) serviced the Plainfield property. (Pl.'s Stmt. Facts ¶¶ 6, 7.) Plaintiff attempted to sell these Illinois rental properties prior to filing for Chapter 13 bankruptcy protection, but failed to do so. (Def.'s Stmt. Facts ¶ 8.) Accordingly, Plaintiff filed for bankruptcy protection to minimize the loss on the properties by using Chapter 13 as a reorganization mechanism. (Id.) As a credit analyst and loan originator, Plaintiff knew that filing for bankruptcy protection would negatively impact his ability to obtain new credit. (Id. ¶¶ 5, 14.) Indeed, Plaintiff testified at his deposition that it makes sense “banks don't want to lend to people who are immediately coming out of bankruptcy.” (Id. ¶ 14.)

         The bankruptcy court entered an order of discharge on February 4, 2014. (Pl.'s Stmt. Facts ¶ 14.) The discharge order, however, did not specify which debts were included in the court's discharge. (Def.'s Stmt. Facts ¶ 19.) Nevertheless, Plaintiff's confirmed Chapter 13 bankruptcy plan called for him to surrender the Plano, Plainfield, and Diamond properties. (Id. ¶ 15.) U.S. Bank filed a foreclosure action in the Circuit Court of Kendall County, Illinois on June 9, 2014 and the Circuit Court entered an order confirming the sale of the Plano property on July 27, 2015. (Id. ¶ 16.) Also, U.S. Bank filed for foreclosure of the Plainfield property (Circuit Court of Will County) that was completed on June 11, 2014 and Diamond property (Circuit Court of Grundy County) that was completed on June 9, 2016. (Id.)

         In the interim, on April 17, 2015, Plaintiff obtained a tri-merge credit report, which combines the three national CRAs' credit information. (Def.'s Stmt. Facts ¶ 22; R. 88-14, Ex. N, 4/17/15 SettlementOne Report.) Plaintiffs April 2015 credit report showed that the U.S. Bank and Cenlar accounts included past due notifications - despite the bankruptcy discharge. (Def.'s Stmt. Facts ¶ 22; R. 111, Def.'s Add'l Facts ¶ 21.) U.S. Bank and Cenlar had provided Experian with this account information reported on Plaintiff's April 2015 credit report. (Def.'s Stmt. Facts ¶ 46.)^[1] The April 2015 credit report also indicated that foreclosure proceedings were pending in relation to the Illinois rental properties. (Def.'s Stmt. Facts ¶ 22; Ex. N, SettlementOne Report at 8.) On May 28, 2015, Experian received a dispute letter from Plaintiff asking it to “update the subject credit file(s) to reflect the discharged status of the debts as indicated on the Final Report from the [bankruptcy] Trustee.” (Def.'s Add'l Facts ¶ 22; Pl.'s Stmt. Facts ¶ 28.) Plaintiffs dispute letter specifically requested that Experian investigate several accounts, including the accounts with U.S. Bank and Cenlar. (Def.'s Add'l Facts ¶ 23.) Before Experian received Plaintiff's dispute letter on May 28, 2015, U.S. Bank had deleted its reporting for one of the accounts. (Id. ¶ 24.) Thus, in response to Plaintiffs dispute letter, Experian reviewed the correspondence and accompanying documents and then updated the remaining U.S. Bank and Cenlar accounts to reflect that they had been discharged in Plaintiffs Chapter 13 bankruptcy. (Id. ¶ 25.) Experian completed its response to Plaintiff's first dispute letter on June 2, 2015 and sent Plaintiff a new copy of his consumer disclosure on June 2, 2015. (Id. ¶¶ 27, 28.) In addition, Plaintiff sent a duplicate dispute letter on June 1, 2015, to which Experian responded on June 3, 2015 by re-applying the updates it made in the first letter. (Id. ¶ 29; Pl.'s Stmt. Facts ¶ 33.) Experian maintains that after updating Plaintiff's accounts pursuant to his May and June 2015 dispute letters, it provided Dispute Resolution Notifications (“DRNs”) to U.S. Bank and Cenlar. (Def.'s Add'l Facts ¶¶ 27, 29.) Plaintiff, on the other hand, contends that U.S. Bank and Cenlar never received these DRNs. (Pl.'s Stmt. Facts ¶ 31.)

         Also in the spring of 2015, Plaintiff decided to buy a vacation home in Wisconsin. (Pl.'s Stmt. Facts ¶ 25.) When he contacted a mortgage broker at Compass Mortgage in Warrenville, Illinois, the broker told Plaintiff he would not qualify for a mortgage loan while there were two pending foreclosure actions related to the Illinois rental properties. (Def.'s Stmt. Facts ¶ 23.) In May 2015, Plaintiff contacted a mortgage broker at 1st Advantage Mortgage, who also informed Plaintiff that he would not be able to get a mortgage loan until the remaining foreclosures actions in the Illinois courts had been completed. (Id. ¶ 24.) In fact, Plaintiff testified at his deposition that the mortgage underwriters' ultimate concern preventing him from getting a mortgage loan for his Wisconsin vacation property concerned the two pending foreclosures on the surrendered properties. (R. 112-2, Pl.'s Dep., at 113-15; Def.'s Stmt. Facts ¶ 16.) Plaintiff eventually bought a vacation home in Wisconsin by paying approximately $400, 000 in cash. (Pl.'s Dep., at 116; Def.'s Stmt. Facts ¶ 26.)

         LEGAL STANDARD

         Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A genuine dispute as to any material fact exists if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). In determining summary judgment motions, “facts must be viewed in the light most favorable to the nonmoving party only if there is a ‘genuine' dispute as to those facts.” Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007). The party seeking summary judgment has the burden of establishing that there is no genuine dispute as to any material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). After “a properly supported motion for summary judgment is made, the adverse party ‘must set forth specific facts showing that there is a genuine issue for trial.'” Anderson, 477 U.S. at 255 (quotation omitted). “To survive summary judgment, the non-moving party must show evidence sufficient to establish every element that is essential to its claim and for which it will bear the burden of proof at trial.” Life Plans, Inc. v. Security Life of Denver Ins. Co., 800 F.3d 343, 349 (7th Cir. 2015).

         ANALYSIS

         “Congress enacted FCRA in 1970 to ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy.” Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 52 (2007). “Credit reporting agencies prepare reports that provide information about a person's finances - such things as bill-payment history, loans, current debt, and other information” that “is intended to help lenders decide whether to extend credit or approve a loan and what interest rate to charge.” Brill v. TransUnion LLC, 838 F.3d 919, 919-20 (7th Cir. 2016).

         In his First Amended Complaint, Plaintiff alleges that Experian violated the FCRA by failing to follow reasonable procedures to ensure the accuracy of his credit information and failing to properly reinvestigate after he complained of this inaccuracy. See 15 U.S.C. §§ 1681e(b), 1681i(a). The FCRA “provides that ‘whenever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates.'” Childress v. Experian Info. Sols., Inc., 790 F.3d 745, 746 (7th Cir. 2015) (quoting 15 U.S.C. § 1681e(b)). To establish that a CRA failed to follow reasonable procedures pursuant to § 1681e(b), a consumer must show that there was inaccurate information in his consumer credit report due to the CRA's failure to follow reasonable procedures and that this inaccuracy caused him to suffer damages. See Lamar v. Experian Info. Sys., 408 F.Supp.2d 591, 595 (N.D. Ill. 2006); Sarver v. Experian Info. Sols., Inc., 299 F.Supp.2d 875, 876 (N.D. Ill. 2004). Moreover, “[o]nce a consumer report exists, [the FCRA] triggers various duties on the part of a reporting agency, including the obligation to reinvestigate when a consumer contends that [her] consumer report is inaccurate or incomplete[.]” Ruffin-Thompkins v. Experian Info. Sols., Inc., 422 F.3d 603, 607 (7th Cir. 2005) (citation omitted). In other words, a CRA must “reinvestigate items on a credit report when a consumer disputes the validity of those items.” Sarver v. Experian Info. Sols., Inc., 390 F.3d 969, 970-71 (7th Cir. 2004).

         Before any discussion of the reasonableness of Experian's reinvestigation or its procedures ensuring accuracy is necessary, the Court turns to whether Plaintiff has set forth evidence creating a genuine dispute for trial that he suffered damages as a result of the inaccurate information in his April 2015 credit report. See Ruffin-Thompkins, 422 F.3d at 607-08; see alsoSarver, 390 F.3d at 971 (plaintiff “must show that he suffered damages as a result of the inaccurate information”). “The FCRA does not presume damages; instead, [] the consumer must affirmatively prove that she is entitled to damages.” Ruffin-Thompkins, 422 F.3d at 610; see also Sarver, 390 F.3d at 971 (“the FCRA is not a strict liability statute”). In addition, “[w]ithout a causal relation between the violation ...