Free Motion for Judgment on the Pleadings - District Court of California - California

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TOMIO B. NARITA (SBN 156576) JEFFREY A. TOPOR (SBN 195545) SIMMONDS & NARITA LLP 44 Montgomery Street, Suite 3010 San Francisco, CA 94104-4816 Telephone: (415) 283-1000 Facsimile: (415) 352-2625 [email protected] [email protected] Attorneys for Defendant Afni, Inc. UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA DERWIN GRANT, Plaintiff, vs. AFNI, INC., Defendant. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) CASE NO.: C 07 2850 CW NOTICE OF MOTION AND MOTION OF FOR JUDGMENT ON THE PLEADINGS BY DEFENDANT AFNI, INC.; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF Date: July 12, 2007 Time: 2:00 p.m. Ctrm: 2, 4th Floor The Honorable Claudia Wilken

GRANT V. AFNI. INC. (CASE NO. C 07 2850 CW) NOTICE OF MOTION AND MOTION FOR JUDGMENT ON THE PLEADINGS; MEM O IN SUPPORT

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TO PLAINTIFF IN PRO PER DERWIN GRANT: PLEASE TAKE NOTICE that on July 12, 2007 at 2:00 p.m., or as soon thereafter as the matter may be heard in Courtroom 2 of the above entitled court, the Honorable Claudia Wilken presiding, defendant Afni, Inc. ("Defendant") will and hereby does move this Court for an Order, pursuant to Rule 12(c) of the Federal Rules of Civil Procedure, granting judgment on the pleadings in favor of Defendant. The motion is made on the grounds that the Complaint fails to state facts sufficient to constitute a cause of action against Defendant. The skeletal and conclusory allegations in the complaint, even when assumed true, do not state a claim upon which relief may be granted under the Fair Credit Reporting Act ("the FCRA"), 15 U.S.C. § 1681, et seq., because consumers such as Plaintiff cannot pursue claims against furnishers of data such as Defendant based upon the furnisher's alleged reporting of incomplete or inaccurate information under section 1681s-2(a) of the FCRA, and because Plaintiff has not alleged and cannot allege that he disputed the debt at issue in this action pursuant to his responsibilities under section 1692g of the FDCPA and therefore has not stated a claim against Defendant for failure to validate the debt. The motion is based upon this Notice of Motion and Motion for Judgment on the Pleadings, the accompanying Memorandum of Points and Authorities, all pleadings and papers on file herein, and such oral argument as is presented. DATED: June 6, 2007 SIMMONDS & NARITA, LLP TOMIO B. NARITA JEFFREY A. TOPOR

By:

/Tomio B. Narita/ Tomio B. Narita Attorneys for defendant

GRANT V. AFNI. INC. (CASE NO. C 07 2850 CW) NOTICE OF MOTION AND MOTION FOR JUDGMENT ON THE PLEADINGS; MEM O IN SUPPORT

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I.

INTRODUCTION Plaintiff Derwin Grant ("Plaintiff") filed a bare bones complaint, which sets

forth the conclusory allegation that defendant Afni, Inc. ("Defendant") "is in violation of multiple laws" related to the collection and reporting of his account. Plaintiff asserts three claims against Defendant purportedly arising under the Fair Credit Reporting Act, 15 U.S.C. § 1681, et seq. (the "FCRA") and the Fair Debt Collection Practice Act, 15 U.S.C. § 1692 et seq. (The "FDCPA"). Each of Plaintiff's claims fail as a matter of law. Plaintiff has failed to allege facts sufficient to state a cause of action against Defendant under either the FCRA or the FDCPA. Further, Plaintiff cannot amend his Complaint to state valid claims because the Ninth Circuit has squarely held that a consumer like Plaintiff does not have standing to pursue a private right of action against a furnisher of consumer credit information such as Defendant and because Plaintiff cannot allege that he disputed the debt at issue in this action pursuant to his responsibilities under section 1692g of the FDCPA.. Given the complete absence of any factual allegations supporting any valid claims under the FCRA or the FDCPA, judgment should be entered in favor of Defendant.

II.

THE ALLEGATIONS OF THE COMPLAINT Plaintiff originally initiated this case in small claims court by filing his

Complaint against Defendant on April 27, 2007.1 This action was removed to this Court by Defendant on May 3, 2007. In response to the form complaint's inquiry, "Why does the Defendant owe the Plaintiff money?", Plaintiff listed three causes of action:

For the Court's convenience, a copy of the original complaint is attached to 28 this pleading as Exhibit A.
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1) 2)

"The account has been re-aged and is in violation of Re-age (cb and ca) FCRA section 605 [15 U.S.C. § 1681c(b) and (c)]"; "Did not validate debt according to law and continued collection activities which is in violation of FDCPA section 809(b) [15 U.S.C. § 1692g(b)], FTC opinion letter Cass from LeFevre"; and "Did not validate debt and continued to report to credit bureau which is in violation of FDCPA section 809(b) [15U.S.C. § 1692g(b)], FTC opinion letter Cass from LeFevre". . .

3)

See Exhibit A, attached hereto (Plaintiff's Claim and ORDER to Go to Small Claims Court at page 4.) In response to the question, "How did you calculate the money owed to you?" Plaintiff stated: "Based on previous awards. . . Historical court award for violation has been $1000 each." Id. at page 3, ¶4 and page 4. Plaintiff provided no further information in his Complaint.

III.

ARGUMENT A. Standards Governing Motions For Judgment On The Pleadings

"After the pleadings are closed, but within such time as not to delay the trial, any party may move for judgment on the pleadings." See Fed. R. Civ. P. 12(c). The standard applied to a motion for judgment on the pleadings is virtually identical to the standard applicable to a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). See Carmen v. San Francisco Unified Sch. Dist., 982 F. Supp. 1396, 1401 (N.D. Cal 1997); see also McGlinchy v, Shell Chem. Co., 845 F.2d 802, 810 (9th Cir. 1988) (same standard applicable where 12(c) motion based on failure to state a claim). "A judgment on the pleadings is properly granted when, taking all the allegations in the pleading as true, the moving party is entitled to judgment as a matter of law." Nelson v. City of Irvine, 143 F.3d 1196, 1200 (9th Cir. 1998). In ruling on a motion for judgment on the pleadings, the court may consider "documents submitted with the complaint." See E & J Gallo Winery v. Andina Licores S.A., 2006 WL 1817097, *3 (E.D. Cal. June 30, 2006). While the Court must accept as true Plaintiff's material allegations and all reasonable inferences therefrom, see McGlinchy, 845 F.2d at 810, the Court need
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not accept as true conclusory allegations that are unsupported by the facts alleged or that are couched in factual allegation, see Carmen, 982 F. Supp. at 1401; see also Adams v. Johnson, 355 F.3d 1179, 1183 (9th Cir. 2004) ("conclusory allegations of law and unwarranted inferences are insufficient to defeat a motion to dismiss"). But where, as here, it is clear that no relief could be granted to Plaintiff "under any set of facts that could be proven consistent with the allegations," the Court may grant a motion for judgment on the pleadings. McGlinchy, 845 F.2d at 810. B. Plaintiff Lacks Standing To Pursue A Claim Under The FCRA

Plaintiff has attempted to allege a violation of the Fair Credit Reporting Act, 15 U.S.C. § 1681c(c) when he asserts that Defendant "re-aged" his account. See Exhibit A at 4. Plaintiff's claim is barred as a matter of law, however, since FCRA section 1681c is only applicable to Credit Reporting Agencies2 and not to furnishers of consumer credit information such as Defendant. See 15 U.S.C. § 1681c ([N]o consumer reporting agency may make any consumer report containing any of the following items of information. . ." (emphasis added)). Further, amendment would be futile as the Ninth Circuit has squarely held that a consumer has no private right of action against a furnisher of information based upon the furnisher's alleged reporting of false or inaccurate information to a credit reporting agency. See Nelson v. Chase Manhattan Mortgage Co., 282 F.3d 1057, 1059 (9th Cir. 2002). The claim asserted by Plaintiff under the FCRA must fail. The FCRA imposes a duty upon furnishers of information to provide accurate information. See 15 U.S.C. § 1681s-2(a). It prohibits the reporting of

"Credit Reporting Agency" is defined by the FCRA as "any person, which for 26 monetary fees, dues or on a cooperative basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other 27 information on consumers for the purpose of furnishing consumer reports to third 28 parties. . ." See 15 U.S.C. § 1681a(f).
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erroneous information, imposes a duty to correct and update information, and imposes a duty to provide notice of a consumer's dispute. See id. at §§ 1681s2(a)(1) (furnisher's duty to report accurate information), 1681s-2(a)(2) (furnisher's duty to update and correct inaccurate information), and 1681s-2(a)(3) (furnisher's duty to notify agencies of consumer disputes); see also Nelson, 282 F. 3d at 1059; Gorman v. Wolpoff & Abramson, LLP, 370 F. Supp. 2d 1005, 1012 (N.D. Cal. 2005).3 Consumers do not have standing to pursue a private right of action to enforce a furnisher's section 1681s-2(a) duties. Such claims may only be pursued by appropriate state or federal officials. Thus, while section 1681s-2(a) imposes a duty on furnishers to report accurately, section 1681s-2(c) "expressly provides" that claims for willful or negligent noncompliance with the Act (which arise under sections 1681n & o) cannot be based on a failure to comply with section 1681s2(a), unless the action is commenced by a state or federal official. See Nelson, 282 F.3d at 1059; Gorman, 370 F. Supp. 2d at 1012. As the Nelson court said, "[i]t can be inferred . . . that Congress did not want furnishers of credit information exposed to suit by any and every consumer dissatisfied with the credit information furnished." Nelson, 282 F.3d at 1060. Simply put, private plaintiffs cannot sue furnishers of consumer credit information like Defendant based on an alleged violation of section 1681s-2(a). See id. at 1059; Gorman, 370 F. Supp. 2d at 1012; Cisneros, 293 F. Supp. 2d at 1174. Under Nelson, however, Plaintiff lacks standing to pursue a claim to

"The FCRA imposes civil liability on any person who willfully or negligently fails to comply with any of the Act's requirements with respect to any consumer. See 15 U.S.C. § 1681n (willful noncompliance), § 1681o (negligent noncompliance)." Cisneros v. Trans Union, LLC, 293 F. Supp. 2d 1167, 1174 (D. Haw. 2003). Alleged furnishers of information, such as Defendant, are subject to the FCRA. See 15 U.S.C. § 1681s-2; Cisneros, 293 F. Supp. 2d at 1174.
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enforce Defendant's section 1681s-2(a) duties. See 282 F.3d at 1059; see also Grismore v. United Recovery Sys., L.P., 2006 WL 2246359, *3 (D. Ariz. Aug. 3, 2006) (granting summary judgment against pro se plaintiff under Nelson). Plaintiff has alleged a violation of 15 U.S.C. section 1681c which is not law applicable to furnishers like Defendant nor can Plaintiff amend his Complaint to allege a violation of the FCRA. C. Plaintiff Has Not and Cannot Allege Facts Sufficient to State a Cause of Action under the FDCPA

Plaintiff alleges that Defendant violated 15 U.S.C. § 1692g(b) when it "did not validate debt [sic] according to law" and continued both "collection activities" and "to report [the account] to credit bureau [sic]." See Exhibit A at page 4. In order for any violation of § 1692g(b) to have occurred, Plaintiff must prove that within thirty days of receipt of the initial demand letter from Defendant, he requested validation of the debt from Defendant. Plaintiff has not alleged that he timely requested validation of his debt because he cannot. The FDCPA provides that a collector must cease collection efforts and provide verification of the debt if and only if the consumer disputes the debt in writing "within the thirty day period described in subsection (a) of this section." See 15 U.S.C. § 1692g(b). Plaintiff has not alleged that he made any request for validation of the debt much less a timely request. Further, Plaintiff cannot amend his Complaint to state of cause of action because the Ninth Circuit has squarely ruled that untimely requests for verification of a debt do not trigger any obligation on the part of the collector to verify the debt. See Mahon v. Credit Bureau of Placer County, Inc., 171 F. 3d 1197, 1202-1203 (9th Cir. 1999) (request for verification of debt made nine months after receipt of initial notice from collector was untimely and triggered no obligation on part of defendant to verify the debt). Plaintiff's claims under section1692g(b) fail as a matter of law.

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IV.

CONCLUSION For each of the foregoing reasons, Plaintiff's claims fail as a matter of law.

Defendant respectfully requests that judgment be entered in its favor as to all causes of action in the Complaint. Plaintiff should not be granted leave to amend his Complaint because he simply cannot state a valid claim against Defendant under the FCRA or the FDCPA.

DATED: June 6, 2007

SIMMONDS & NARITA, LLP TOMIO B. NARITA JEFFREY A. TOPOR

By:

s/Tomio B. Narita Tomio B. Narita Attorneys for Defendant

GRANT V. AFNI. INC. (CASE NO. C 07 2850 CW) NOTICE OF MOTION AND MOTION FOR JUDGMENT ON THE PLEADINGS; MEM O IN SUPPORT

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Exhibit A

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