United States District Court, C.D. Illinois, Peoria Division
MATTHEW S. GORDON II, Plaintiff,
DISCOVER BANK, Defendant.
ORDER AND OPINION
E. SHADID UNITED STATES DISTRICT JUDGE
case comes before the Court on Defendant's Motion to
Dismiss (Doc. 5). Because the Court has determined that the
action fails to state a claim upon which relief may be
granted, the Motion to Dismiss is GRANTED and the case is
DISMISSED with prejudice.
filed his Complaint in McClean County Circuit Court on
January 22, 2019. Plaintiff alleges that Defendant had
“falsely stated that they were owed a debt in the
amount of $1, 320.69.” Doc. 1, Ex. A. According to
Plaintiff, Defendant violated the Fair Credit Reporting Act
(“FCRA”) by falsely reporting the debt and
continuing to report the debt to credit bureaus. Id.
On March 4, 2019, Defendant filed a Notice of Removal
removing this case from McLean County Circuit Court due to
the federal jurisdiction conferred under the Fair Credit
Reporting Act. On March 13, 2019, Defendant filed a Motion to
Dismiss for failure to state a claim upon which relief can be
granted pursuant to Fed.R.Civ.P. 12(b)(6).
October 31, 2016, prior to filing the Complaint, Defendant
brought a collection action against Plaintiff in McLean
County Circuit Court: Discover Bank v. Gordon, No.
2016-SC-001747. On November 18, 2016, the state court entered
a default judgment against Gordon in the amount of $1, 320.69
and court costs. Doc. 6, Ex. B. Plaintiff filed a motion to
vacate the judgment in November 2018, which the McLean County
Circuit Court denied. Doc. 6, Ex. C. Plaintiff claims that he
found information proving that he did not owe the money. He
then sent letters to three consumer reporting agencies
claiming that his credit report was inaccurate. He also sent
a letter to Defendant claiming that the account was not his
and requesting an investigation. See Doc. 9, Exs. B and C.
All three consumer agencies responded that Defendant
confirmed the debt was Plaintiff's. Plaintiff claims that
Defendant has not given him evidence or documentation about
Defendant's investigation into Plaintiff's debt. Doc.
9, p. 3. Plaintiff claims that continued reporting of this
debt, which he claims is incorrect, is in violation of the
Fair Credit Reporting Act and that Defendant's actions
constitute negligent misrepresentation and defamation. Doc.
1, Ex. A.
12(b)(6) of the Federal Rules of Civil Procedure provides for
dismissal where an action fails to state a claim upon which
relief can be granted. “To survive a motion to dismiss,
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 Bell Atl. Corp. v. Twombly,
550 U.S. 544, 553 (2007)). “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. “Where the well-pleaded facts do not
permit the court to infer more than the mere possibility of
misconduct, the complaint has alleged-but it has not
‘shown'- ‘that the pleader is entitled to
relief.'” Id. at 679 (citing Fed.R.Civ.P.
Plaintiff bases his claim against Defendant on
Defendant's failure to report his information accurately
under 15 U.S.C. §1681s-2(a). This section of the FCRA
imposes a duty upon furnishers of credit information to
provide accurate information to consumer reporting agencies.
In sections 1681n and 1681o, the FCRA allows for civil action
for willful or negligent representation. However, these two
sections do not apply to section 1681s-2(a) under section
1681s-2(c)(1). Additionally, the Seventh Circuit ruled in
Purcell v. Bank of America that there is no private
right of action against a furnisher for inaccurate reporting.
Purcell v. Bank of Am., 659 F.3d 622, 623 (7th Cir.
2011). Pursuant to Purcell, Plaintiff does not have
a claim against Defendant for the failure to report
accurately, even if we are to assume the allegations as true.
Plaintiff's only legal recourse under the FRCA against
this Defendant is to submit his claim to federal officials
and agencies and state officials identified in section 1681s.
15 U.S.C. § 1681s-2(d).
Plaintiff alludes to another duty in his complaint but does
not directly address the issue. Under the FCRA, Defendant has
the duty to investigate disputed information and report the
results of the investigation to consumer reporting agencies.
15 U.S.C. § 1681s-2(b)(1). This section of the FCRA does
provide a private right of action under sections 1681n and
1681o, as it is not limited under section 1681s-2(c). 15
U.S.C. § 1681s-2(c). As Plaintiff has not actually
alleged this specific claim, the Court does not need to
decide this issue.
if the Court were to address this claim, it would not be
facially plausible. Plaintiff claimed that the debt was wrong
and notified the credit reporting agencies that it should not
be on his credit reports. The credit reporting agencies
contacted Defendant, and Defendant replied timely that the
debt was in fact accurate. The debt reported is the exact
debt Plaintiff owed to Defendant as confirmed by the McLean
County Circuit Court ruling in 2016. Plaintiff claims that
the McLean County Court decision is not evidence that the
debt is correct because it was a default judgment. Plaintiff
also filed a state court motion to vacate the judgment two
years after the entry of the judgment, which was promptly
denied because it was outside of the required thirty-day
window. Plaintiff claims that he has evidence that the debt
is not his. But by failing to contest the debt in the state
court proceeding, he is estopped from doing so here. See
Hukic v. Aurora Loan Servs., 588 F.3d 420, 431 (7th Cir.
2009). The Court therefore would dismiss this claim even if
it had been raised.
Plaintiff claims that Defendant committed negligent
misrepresentation and defamation against him by allegedly
reporting an inaccurate debt. Even accepting this allegation
as true, the FCRA preempts any form of state law, statutory
or common, that relates to “the responsibilities of
persons who furnish information to consumer reporting
agencies” under section 1681s-2. 15 U.S.C. §
1681t(b). While the Court dismisses the FCRA claims outright,
the Court would also dismiss all state law claims with
prejudice pursuant to Purcell. Purcell, 659 F.3d at
reasons stated herein, Defendant's Motion to Dismiss
(Doc. 5) is GRANTED, as Plaintiff has no private right of
action under the FCRA for his 15 U.S.C. § 1681s-2(a)
claim. Plaintiff's state law claims are also DISMISSED as
they are preempted under 15 U.S.C. § 1681t(b). As leave
to amend would be futile to ...