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Kauffman v. Kauffman

United States District Court, D. Arizona

June 1, 2018

Cristi C Kauffman, Plaintiff,
v.
Michael P Kauffman, Sally M Colton, Cordell Law LLP, Trans Union LLC, and TransUnion Interactive Incorporated, Defendants.

          ORDER

          David G. Campbell United States District Judge.

         Plaintiff Cristi Kauffman brought this action against her former husband, Michael Kauffman, his former counsel in their disputed state family-law case, Trans Union LLC, and Trans Union's wholly owned subsidiary, TransUnion Interactive Incorporated (“TUI”), after Mr. Kauffman allegedly obtained credit-monitoring services under Plaintiff's name through Trans Union and TUI. Doc. 1. Trans Union moved to dismiss on January 9, 2018, but the Court granted Plaintiff's request for leave to amend and denied the motion as moot. Doc. 36. Plaintiff filed a first amended complaint (“FAC”) (Doc. 37), and Trans Union now moves to dismiss the FAC (Doc. 44). The motion is fully briefed, and no party requests oral argument. Docs. 52, 53. For the reasons explained below, the Court will grant Trans Union's motion.

         I. Background.

         For purposes of this motion, Plaintiff's factual allegations are accepted as true. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Plaintiff and Mr. Kauffman divorced in January 2017. Doc. 37 ¶ 29. Plaintiff alleges that during the course of their subsequent family-law proceeding in Maricopa County Superior Court, Mr. Kauffman “obtained two consumer reports on [Plaintiff] under false pretenses from [Trans Union] through its wholly owned subsidiary [TUI]” and provided the reports to his attorney “for purposes outside the scope of permissible purposes” under the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681 et seq. Id. ¶¶ 1, 32.

         The reports, attached to the complaint but heavily redacted (Doc. 37-1 at 2-45), were obtained through https://membership.tui.transunion.com on September 9, 2017, under the heading “Credit Monitoring” and subheading “Credit Report.” The reports begin with an “Account Summary, ” which includes Plaintiff's credit score, balances, payments, number of open and closed credit accounts, inquiries, and other similar information. Doc. 37-1 at 2, 8. The reports also contain a “Personal Information” section, which includes Plaintiff's name, date of birth, current and previous addresses, and current and previous employers. Id. at 3, 9. The remainder of each report provides details regarding each of Plaintiff's accounts, inquiries, and public records. Id. at 3-7, 9-45.

         The attorney used the reports “in evaluating and defending” Mr. Kauffman's position in the family law matter. Id. ¶ 36. Plaintiff first learned of the reports when they were turned over to her attorney with Mr. Kaufman's disclosure statement. Id. ¶ 39. Plaintiff was “emotionally upset” when she learned of the reports, and she worried that Mr. Kauffman obtained them partly for the purpose of locating and stalking her. Id. ¶ 71. Plaintiff went to Trans Union's website and contacted the customer service hotline. Id. ¶ 41. After two phone calls, Trans Union agreed that Mr. Kauffman's access was unauthorized, blocked his access, and froze the account. Id. ¶¶ 41-51. A few days later, Plaintiff received two letters - one from “TransUnion LLC” and one from “TransUnion Interactive” - confirming the phone calls and the suspicious activity on her account. Id. ¶¶ 55-57; Doc. 37-1 at 47, 49-50.

         Plaintiff alleges that Trans Union and TUI “failed to use proper care to assure that it was [Plaintiff] who was setting up the credit monitoring service, rather than an imposter.” Doc. 37 ¶ 72. She further alleges that Trans Union and TUI “are alter egos of one another” and “worked in conjunction to provide the reports to” Mr. Kauffman. Id. ¶¶ 68-70. Finally, Plaintiff asserts that Trans Union and TUI provided a “consumer report” to Mr. Kauffman “without a permissible purpose allowed under the FCRA.” Id. ¶ 74.

         II. Legal Standard.

         A successful motion to dismiss under Rule 12(b)(6) must show either that the complaint lacks a cognizable legal theory or fails to allege facts sufficient to support its theory. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990). A complaint that sets forth a cognizable legal theory will survive a motion to dismiss as long as it contains “sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Iqbal, 556 U.S. at 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (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.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556). “The plausibility standard is not akin to a ‘probability requirement, ' but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Id.

         III. Discussion.

         Plaintiff asserts three claims against Trans Union: (1) negligent and (2) willful violation of 15 U.S.C. § 1681b(a), and (3) common law invasion of privacy. Doc. 37 ¶¶ 84-104. Trans Union argues that the first two claims fail because Plaintiff has not alleged facts showing a “consumer report” was involved, and the third claim fails because it is preempted by the FCRA. Doc. 44.

         A. Section 1681b(a).

         The FCRA requires that a consumer reporting agency (“CRA”) have a “permissible purpose” for furnishing a “consumer report.” 15 U.S.C. § 1681b(a); TRW, Inc. v. Andrews, 534 U.S. 19, 23 (2001). Section 1681b provides an exhaustive list of the permissible purposes. See Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1545 (2016). Trans Union concedes that it is a CRA. Doc. 44 at 1.

         To state a § 1681b claim against Trans Union, Plaintiff must allege facts showing that Trans Union furnished a “consumer report” without a permissible purpose. See 15 U.S.C. § 1681b(a); Rosco v. Experian Info. Sols., No. 2:15-CV-325-RMP, 2017 WL 6061977, at *7 (E.D. Wash. Dec. 7, 2017). Additionally, Plaintiff must allege that Trans Union acted negligently or willfully. 15 U.S.C. §§ 1681n, 1681o; see also Guimond v. ...


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