United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
JORGE L. ALONSO United States District Judge.
Henry Morgan, brings this case under the Fair Credit
Reporting Act (“FCRA”), 15 U.S.C. § 1681
et seq, against defendant Experian Information
Solutions, Inc. (“Experian”), a credit reporting
agency. Defendant moves for judgment on the
pleadings. For the following reasons, the motion is denied.
to the allegations of the complaint, plaintiff filed for
Chapter 13 bankruptcy on February 25, 2013. (Compl. ¶
9.) The bankruptcy court confirmed his Chapter 13 plan on
January 30, 2014, and it entered a discharge order on May 24,
2014. (Id. ¶¶ 15, 17, 19.) Among the
discharged debts was plaintiff's mortgage debt to PNC
Bank, N.A. (“PNC”); under the terms of the
Chapter 13 plan, plaintiff was to surrender his mortgaged
property in satisfaction of PNC's claim. (Id.
¶¶ 10, 13, 16.)
the discharge of his debts in bankruptcy, plaintiff requested
that Experian update his PNC account to reflect its
discharged status. (Id. ¶ 42.) In the ensuing
months, Experian twice issued “reinvestigation
reports” in response to plaintiff's inquiries, and
these reports showed the PNC account as discharged in
bankruptcy, with an account balance of zero. (Id.
¶¶ 41-56, Exs. J, M.) The “Comment”
section of the report's PNC tradeline indicated that
plaintiff was “paying under partial payment
agreement.” (Id., Exs. J, M.)
12(c) permits a party to move for judgment on the
pleadings, which consist of the “the complaint, the
answer, and any written instruments attached as
exhibits.” N. Ind. Gun & Outdoor Shows, Inc. v.
City of S. Bend, 163 F.3d 449, 452 (7th Cir. 1998)
(citing Fed. R. Civ. P. 10(c)). A motion for
judgment on the pleadings under Rule 12(c) is
governed by the same standards as a motion to dismiss for
failure to state a claim pursuant to Rule 12(b)(6).
Hayes v. City of Chi., 670 F.3d 810, 813 (7th Cir.
2012). “A motion under Rule 12(b)(6) tests whether
the complaint states a claim on which relief may be
granted.” Richards v. Mitcheff, 696 F.3d 635,
637 (7th Cir. 2012). Under Rule 8(a)(2), a complaint must
include “a short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). The short and plain statement under
Rule 8(a)(2) must “give the defendant 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)
federal notice-pleading standards, a plaintiff's
“[f]actual allegations must be enough to raise a right
to relief above the speculative level.” Id.
Stated differently, “a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 570). “A claim has facial
plausibility when the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.”
Id. (citing Twombly, 550 U.S. at 556).
“In reviewing the sufficiency of a complaint under the
plausibility standard, [courts must] accept the well-pleaded
facts in the complaint as true, but [they] ‘need[ ] not
accept as true legal conclusions, or threadbare recitals of
the elements of a cause of action, supported by mere
conclusory statements.'” Alam v. Miller Brewing
Co., 709 F.3d 662, 665-66 (7th Cir. 2013) (quoting
Brooks v. Ross, 578 F.3d 574, 581 (7th Cir. 2009)).
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). Under the FCRA, a
credit reporting agency such as Experian is required to
“follow reasonable procedures to assure maximum
possible accuracy” of all information contained in any
“consumer report” it “prepares.” 15
U.S.C. § 1681e(b). Further, if a consumer notifies a
credit reporting agency that he is disputing “the
completeness or accuracy of any item of information contained
in [the] consumer's file, ” the credit reporting
agency must take certain steps to reinvestigate the matter.
15 U.S.C. § 1681i. To state a claim against Experian
under either section 1681e(b) or 1681i, plaintiff must
plausibly allege that Experian issued credit reports that
contained inaccurate information about his debts. See
Handrock v. Ocwen Loan Servicing, LLC, No. 16 C 5732,
2016 WL 6465900, at *2 (N.D. Ill. Nov. 1, 2016) (citing
Henson v. CSC Credit Servs., 29 F.3d 280, 284 (7th
Cir. 1994) and DeAndrade v. Trans Union LLC, 523
F.3d 61, 67 (1st Cir. 2008)).
motion for judgment on the pleadings, Experian claims that
plaintiff fails to state a claim because he alleges no
inaccuracy in Experian's credit reporting. Upon learning
of plaintiff's bankruptcy, Experian updated its reports
to reflect the bankruptcy, as it was required to do, and its
post-discharge reports correctly reflected that
plaintiff's PNC account balance was zero. Plaintiff
responds that even after Experian reinvestigated and updated
the PNC account, Experian's credit reporting was still
inaccurate because it continued to report that plaintiff was
“paying under [a] partial payment agreement” with
respect to the PNC account. This was untrue; plaintiff was no
longer paying PNC anything, nor was he required to do so
after the debt was discharged in bankruptcy.
credit report that unambiguously shows that a debt has been
discharged in bankruptcy and that the consumer's account
balance is zero is generally not inaccurate or misleading and
cannot form the basis for a valid FCRA claim. See
Hupfauer v. Citibank, N.A., No. 16 C 475, 2016 WL
4506798, at *5 (N.D. Ill. Aug. 19, 2016). But some courts in
this district have held that “merely reporting a zero
balance after a bankruptcy discharge [is not] sufficient to
avoid inaccurate reporting under the FCRA, ” if the
credit report also includes additional inaccurate information
that makes the credit report inaccurate or misleading as a
whole. See Id. (citing Freedom v. Citifinancial,
LLC, No. 15 C 10135, 2016 WL 4060510, at *6 (N.D. Ill.
July 25, 2016)); Jackson v. Experian Info. Sols.,
Inc., No. 15 C 11140, 2016 WL 2910027, at *5 (N.D. Ill.
May 19, 2016). For example, in Freedom, 2016 WL
4060510, at *6, the credit report showed that the
plaintiff's debt had been discharged in bankruptcy, but
it also erroneously showed that plaintiff had a pending
“scheduled payment” on that debt. The court held
that the plaintiff's FCRA claim survived the
defendant's motion to dismiss because the report
“could create the mistaken impression that Plaintiff
still owed on the account, which was not accurate.”
case, the erroneous “paying under partial payment
agreement” comment in Experian's reports is similar
to the erroneous “scheduled payment” in the
report in Freedom. It creates an ambiguity in the
report, which could create the mistaken impression that
plaintiff still owes on his PNC account. A reasonable finder
of fact could interpret this as the reporting of inaccurate
or at least misleading information. This is sufficient to
survive Experian's motion to dismiss.
reasons set forth above, the Court denies defendant's
motion for judgment on the pleadings . A status ...