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Cook v. Mountain America Federal Credit Union

United States District Court, D. Arizona

August 3, 2018

Tyler Cook, Plaintiff,
Mountain America Federal Credit Union; Experian Information Solutions, Inc.; Equifax Information Services, LLC; and TransUnion, LLC, Defendants.


          H. Russel Holland United States District Judge.

         Motion to Dismiss;

         Motion to Amend

         Defendant Mountain America Federal Credit Union moves to dismiss plaintiff's claims against it.[1] This motion is opposed, [2] and plaintiff moves for leave to amend his complaint.[3]

         Plaintiff's motion for leave to amend is opposed.[4] Oral argument was requested but is not deemed necessary.


         Plaintiff Tyler Cook purchased a vehicle on March 6, 2013, which he financed with a loan provided by defendant Mountain America Federal Credit Union.[5] “Plaintiff fell behind on his vehicle payments and the vehicle was repossessed and sold at auction.”[6] Plaintiff alleges that “[i]n December of 2015, the deficiency balance for the vehicle was assigned to Financial Assistance, Inc. . . ., a debt collector.”[7] Plaintiff alleges that “[d]espite the assignment of the deficiency balance to the debt collector, Mountain America continues to report a balance of $13, 651.00 and updates the account as [a] ‘charge off.'”[8] Thus, plaintiff alleges that both Financial Assistance and Mountain America are reporting this same debt, and that the only difference is that Financial Assistance reports the debt amount as $13, 652 and Mountain America reports the debt amount as $13, 651.[9]

         Plaintiff alleges that he has complained more than once to defendants Experian Information Solutions, Inc; Equifax Information Services, LLC; and TransUnion, LLC about this duplicate reporting but none of them has done anything about it.[10] Plaintiff alleges that he has also sent two letters to Mountain America about the double reporting, but that Mountain America has never responded.[11] Plaintiff alleges that “[d]ue to [d]efendants reporting, [he] has been denied credit for the purchase of a new home” and that he has had “multiple rental applications denied[.]”[12] Plaintiff alleges that the problem with his credit has “caused an enormous stress on his marriage” and “caused [him] to suffer extreme emotional distress as well as many sleepless nights.”[13]

         On May 22, 2018, plaintiff commenced this action. In his complaint, plaintiff asserts a Fair Credit Reporting Act (FCRA) claim against Mountain America.

         On June 13, 2018, Mountain America answered plaintiff's complaint.[14] On the same day but a few minutes later, Mountain America filed a motion to dismiss pursuant to Rule 12(b)(6), Federal Rules of Civil Procedure.[15] The motion to dismiss is ready for disposition as is plaintiff's motion for leave to amend.


         “Under the law of the 9th Circuit, where a Rule 12(b)(6) motion to dismiss for failure to state a claim upon which relief can be granted is filed after an answer is filed, a court may deny the motion to dismiss as untimely, or the court may consider the Rule 12(b)(6) motion to dismiss as a motion for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c).” Beery v. Hitachi Home Electronics (America), Inc., 157 F.R.D. 477, 479 (C.D. Cal. 1993). The court perceives no reason not to consider Mountain America's motion to dismiss as a Rule 12(c) motion.

         In order to survive a Rule 12(c) motion, a complaint must “contain[] ‘sufficient factual matter, accepted as true, to state a claim of relief that is plausible on its face.'” Harris v. County of Orange, 682 F.3d 1126, 1131 (9th Cir. 2012) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “[A] claim [is] plausible when a plaintiff pleads sufficient facts to allow the [c]ourt to draw a reasonable inference of misconduct, but the [c]ourt is not required ‘to accept as true a legal conclusion couched as a factual allegation.'” Id. (quoting Iqbal, 556 U.S. at 678).

         As an initial matter, there is some disagreement between the parties as to compliance with Local Rule 12.1(c). Rule 12.1(c) provides that a Rule 12(b)(6) or Rule 12(c) motion will not be considered unless the motion “includes a certification that, before filing the motion, the movant notified the opposing party of the issues asserted in the motion and the parties were unable to agree that the pleading was curable in any part by a permissible amendment offered by the pleading party.” In Mountain America's motion, its counsel states that he “sent an email to [p]laintiff's counsel, attaching a draft version of this motion to dismiss, notifying [p]laintiff of the issues asserted to determine if the parties were able to agree on a permissible amendment. After exchanging emails, the parties were not able to agree on a permissible amendment.”[16] Plaintiff contends that the parties were still discussing the issues raised in the motion to dismiss when Mountain America filed the instant motion and suggests that the instant motion to dismiss was premature. However, the emails exchanged indicate that Mountain America believed that plaintiff had not stated a plausible FCRA claim and that plaintiff was standing by his allegations.[17] The emails do not indicate that it was likely that the parties were going to reach agreement as to a permissible amendment. Defense counsel adequately complied with Rule 12.1(c).

         Turning then to the merits of the motion to dismiss, the FCRA was enacted “‘to ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy.'” Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1153 (9th Cir. 2009) (quoting Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 52 (2007)). “[T]he FCRA imposes some duties on the sources that provide credit information to [consumer reporting agencies (CRAs)], called ‘furnishers' in the statute.” Id.

         “Section 1681s-2 [of the FCRA] sets forth ‘[r]esponsibilities of furnishers of information to consumer reporting agencies,' delineating two categories of responsibilities.” Id. at 1154. “Subsection (a) details the duty ‘to provide accurate information[.]” Id. However, “[d]uties imposed on furnishers under subsection (a) are enforceable only by federal or state agencies.” Id.

         “Section 1681s-2(b) imposes a second category of duties on furnishers of information.” Id.

Subsection 1681s-2(b) provides that, after receiving a notice of dispute, ...

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