Free Complaint - District Court of Delaware - Delaware

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 1 of 11

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

CATHERINE CALLOWAY and MICHAEL CALLOWAY, Plaintiffs, v. GREEN TREE SERVICING, LLC Defendant.

* * * * * * * * * * * *

CIVIL ACTION-COMPLAINT Plaintiffs Catherine Calloway and Michael Calloway, by and through their attorney, Maggie Clausell, hereby bring this Complaint against Defendant Green Tree Servicing, LLC, and in support, aver the following: I. INTRODUCTION 1. Plaintiffs bring this action for damages based upon Defendant's violation

of the Fair Credit Reporting Act (herein after referred to as "FCRA"), 15 U. S. C. § 1681 et. seq., and claims under Delaware law. Plaintiffs seek actual damages, punitive damages, costs and attorneys fees. II. 2. JURISDICTION

This court has subject matter jurisdiction over this Complaint pursuant to

FCRA, 15 U. S. C. § 1681 et. seq. and 28 U. S. C. § 1331. 3. Jurisdiction lies over state law claims based on the principles of

supplemental jurisdiction as codified at 28 U. S. C. §1367.

1

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 2 of 11

III. 4.

VENUE

All of the claims herein arose within the jurisdiction of the United States

District Court of Delaware. Venue is proper in the District of Delaware pursuant to 15 U. S. C. §1681p and 28 U. S. C. §1391. IV. 5. PARTIES

Catherine and Michael Calloway, are adult individuals, husband and wife,

who are both residents of the State of Delaware, residing at 514 King Street, Laurel DE 19956. 6. Green Tree Servicing, LLC (hereinafter, Green Tree) is a corporation

organized under the laws of the State of Delaware whose principal place of business is 332 Minnesota Street, St. Paul, MN 55101, whose registered agent is The Corporation Company, Corporation Trust Center, 1209 Orange Street, Wilmington, DE 19801, engaged in the business of servicing mortgage loans within the meaning of 12 U.S.C. 2605(i)(3). Green Tree is a "servicer" within the meaning of 12 U. S. C. 2605 (i)(2). V. STATUTORY STRUCTURE A. FAIR CREDIT REPORTING ACT 7. The Fair Credit Reporting Act (FCRA) 15 U. S. C. §1681 et seq. was

enacted to require the consumer reporting agencies to adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and proper utilization of such information. 15 U. S. C. § 1681 (b).

2

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 3 of 11

8.

Under the FCRA , whenever a consumer reporting agency prepares a

consumer report it shall follow reasonable procedures to assure maximum accuracy of the information concerning the individual about whom the report relates. 15 U. S. C. §1681 e (b). 9. Under the FCRA, if the completeness or accuracy of any item of

information contained in a consumer's file at a consumer reporting agency is disputed by the consumer, and the consumer notifies the agency directly of such dispute, the agency shall reinvestigate free of charge and record the current status of the disputed information, or delete the item from the file in accordance with paragraph (5), before the end of the 30-day period beginning on the date on which the agency receives the notice of dispute from the consumer. 15 U. S. C. §1681 i(a)1. 10. Under the FCRA, a person shall not furnish any information relating to a

consumer to any consumer reporting agency if the person knows or consciously avoids knowing that the information is inaccurate. 15 U. S. C. §1681s-2(a)(1)(A). Moreover, once a subscriber has been notified that specific information is inaccurate and the information, in fact, turns out to be inaccurate, that information must be deleted and suppressed and cannot continue to be furnished. If the furnisher-subscriber determines that information it has reported is inaccurate or incomplete, the furnisher has a duty to notify, retract, and correct its prior reports to all agencies to whom it subscribes and to correct its own internal records. 11. Under the FCRA, a person who regularly and in the ordinary course of

business furnishes information to one or more consumer reporting agencies about the person's transactions or experiences with any consumer; and has

3

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 4 of 11

furnished to a consumer reporting agency information that the person determines is not complete or accurate, shall promptly notify the consumer reporting agency of that determination and provide to the agency any corrections to that information or any additional information, that is necessary to make the information provided by the person to the agency complete and accurate, and shall not thereafter furnish to the agency any of the information that remains not complete or accurate (15 U. S. C. § 1681s-2(a)(2). 12. The FCRA expressly provides consumers with a private cause of action;

violation of 15 U. S. C. §16812s-2 are enforceable and actionable via 15 U. S. C. §1681n and 15 U. S. C. §1681o, depending on whether the violation is willful or merely negligent. 13. Under the FCRA, any person who willfully fails to comply with any

requirement imposed under this subchapter with respect to any consumer, is liable to that consumer in an amount equal to the sum of any actual damages sustained by the consumer as a result of the failure or damages of not less than $100 or more than $1000; such amount of punitive damages as the Court may allow; and the costs of the action together with reasonable attorney's fees. 15 U. S. C. § 1681n. VI. 14. FACTS

Plaintiffs are the current record owners of the Property at 514 King Street,

Laurel, DE 19956, as evidenced by the deed recorded with the Recorder of Deeds for Sussex County Delaware at Book 1206, Page 261, a true and correct copy of which is attached hereto and incorporated herein as Exhibit "A".

4

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 5 of 11

15.

Plaintiffs executed a mortgage with Green Tree Financial Services

(hereinafter, "GTFS") on or about October 9, 1996. A copy of the Mortgage is attached hereto and incorporated herein as Exhibit "B". 16. On October 9, 1996 Plaintiffs executed a note with Green Tree Financial

Services, agreeing to pay $125,000 plus interest. A copy of the Note is attached hereto and incorporated herein as Exhibit "C". 17. The monthly payment and interest was $1285.98, with the first payment

due on November 14, 1996. 18. Plaintiff commenced payments under the terms of the note and mortgage

on November 14, 1996. 19. Green Tree Mortgage, LLC , a subsidiary of GTFS, serviced the note from

October 11, 1996 to 1999 when Conseco Finance Servicing Corporation (hereinafter, "Conseco") began servicing the loan. 20. 21. Conseco serviced the loan from 1999 to June 2003. Conseco Finance Corporation filed bankruptcy in 2003. Green Tree

Servicing, LLC acquired servicing rights to Plaintiffs' mortgage on or about June 22, 2003 through a §363 bankruptcy asset sale. 22. 23. 24. Plaintiffs' claims in this complaint arose after the 2003 sale by Conseco. At all times Defendant acted through its authorized agents and employees. In 1996, Plaintiffs' mortgage account number assigned by Green Tree

Financial Services was 10000156. 25. From 1997 to a point in 2005, Plaintiffs' mortgage account number was

6700107318.

5

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 6 of 11

26.

From some point in 2005 to date, Plaintiffs' assigned mortgage account

number was changed to 88037954. 27. Plaintiffs subsequently learned that Defendant was reporting both account

number 6700107318 and account number 88037957 as separate trade lines to credit reporting agencies as active accounts with balances. 28. As of November 10, 2007, the Plaintiffs' Trans Union report contained the

following trade-lines (Exhibit D): A) Green Tree #88037954, installment account with a balance of $92613,

opened 10/1996. B) Green Tree #6700107318, mortgage account with a balance of $93027,

opened 10/1996 29. These trade-lines contained inaccurate credit information in that account

number 6700107318 had been changed to account number 88037954 and Plaintiffs' liability to Green Tree was significantly less than $185,640.00, the sum of the two account balances. 30. These trade-lines contained inaccurate credit information in that account

number 88037954 is a mortgage account, not an installment loan as reported. 31. On or about October 1, 2007, pursuant to 15 U.S. C. §1681i, Plaintiffs

disputed the accuracy of the information by requesting that the credit reporting agencies, Trans Union, Equifax, and Experian correct the error on their credit report. The Plaintiffs' request specifically stated that account number #6700107318 should show a balance of $0 and that account number 88037954 was a mortgage account (Exhibit E).

6

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 7 of 11

32.

Trans Union subsequently responded to this request from Plaintiff by

requesting verification of the trade-lines by Green Tree, which furnished the information to Trans Union. 33. Defendant falsely verified the false reporting of the two disputed account

numbers to Trans Union. 34. On or about November 10, 2007, Trans Union responded to the Plaintiffs

request for reinvestigation of the disputed accounts with inaccurate information as verified (Exhibit F). 35. The inaccurate information remains on Plaintiffs' credit reports. As of

August 18, 2008, the Plaintiffs' Trans Union report contained the following tradelines (Exhibit G): A) Green Tree #88037954, installment account with a balance of $88,171,

opened 10/1996, updated 7/2008. B) Green Tree #6700107318, mortgage account with a balance of $90874,

opened 10/1996, verified 1/2008. 36. The inaccurate trade-lines were maintained on the Plaintiffs' report based

on Defendant's false verification in response to the request for reinvestigation. 37. Plaintiffs' creditworthiness has been compromised by the actions and

omissions of the Defendant. 38. Defendant's false reporting has the effect of increasing the cost of credit

available to the Plaintiffs. 39. Defendant's false reporting has the effect of increasing the cost of credit

available to the Plaintiffs.

7

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 8 of 11

40.

Defendant's false reporting has the effect of reducing the availability of

credit to the Plaintiffs. 41. As a result of the misleading and inaccurate information reported by the

Defendant, the Plaintiffs have suffered actual damages, including financial damages and emotional distress. VII. CAUSES OF ACTION 42. Defendant has willfully and/or negligently violated the provisions of the

FCRA by willfully and/or negligently failing to comport with FCRA, 15 U.S.C. §1681s-2(b). 43. Defendant was required under FCRA, 15 U.S.C. §1681s-2(b) to respond

to the request for reinvestigation by the Plaintiffs by completing a diligent inquiry into the facts underlying the trade-lines and providing accurate information to the credit reporting agencies regarding those trade-lines. 44. Defendant's reinvestigation included the following duties and was required

to meet the following standards: a) to include a review of all information provided to it by the credit reporting

agency; b) c) To be conducted in good faith; To be conducted in such a fashion as to assure the maximum possible

accuracy of the Plaintiffs' credit reports; d) To be conducted in such a way as to not to violate any of the general

prerequisites for Defendant's conduct under FCRA, 15 U.S.C. §1681s-2(a) or any other statutory requirements for furnishers of credit information; e) To be conducted in a reasonable fashion; and

8

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 9 of 11

f)

To be conducted based on a review of all information reasonably available

to Green Tree. 45. Following the reinvestigation, Defendant reported the erroneous credit

information with actual knowledge of errors, in violation of FCRA, 15 U.S.C. §1681s-2(b) and the general duties implied all conduct of furnishers under FCRA, 46. Following the reinvestigation, Defendant reported the erroneous credit

information and consciously avoided knowing that the credit information was inaccurate, in violation of FCRA, 15 U.S.C. §1681s-2(b) and the general duties implied to all conduct of furnishers under FCRA, 15 U.S.C. §1681s-2(a))1)(A). 47. Following the reinvestigation and dispatch of notice directly to Defendant

at its designated address, Defendant Green Tree reported credit information that was in fact not accurate, in violation of the FCRA, 15 U.S.C. §1681s-2(b) and the general duties implied to all conduct of furnishers under FCRA, 15 U.S.C. §1681s2(a)(1)(A). 48. Following the reinvestigation and dispatch of notice directly to Defendant,

Defendant Green Tree failed to notify the consumer reporting agencies to whom it reported that the accounts were in dispute in violation of FCRA, 15 U.S.C. §1681s-2(b) and the general duties implied to all conduct of furnishers under FCRA, 15 U.S.C. §1681s-2(a)(3). 49. 50. Defendant's Green Tree's reinvestigation was not conducted in good faith. Defendant's Green Tree's reinvestigation was not conducted in such as a

way as to insure the maximum possible accuracy of the Plaintiffs' consumer reports. 51. Defendant Green Tree's reinvestigation was not conducted reasonably.

9

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 10 of 11

52.

Defendant Green Tree's reinvestigation was not conducted using all

information reasonably available to Green Tree. 53. Defendant Green Tree's reinvestigation was per se deficient by reasons of

these failures of Green Tree in its reinvestigation of the disputed trade-lines on the Plaintiffs' consumer reports. 54. Green Tree action in violating the FCRA, 15 U.S.C. §1681s-2(b)

constituted willful and/or negligent non-compliance with the FCRA, and entitles the Plaintiffs to actual damages enumerated in 15 U.S. C. § 1681o and/or 15 U.S. C. § 1681n. 55. Defendant Green Tree has defamed Plaintiffs by publishing misleading

and/or inaccurate information to third parties information regarding their creditworthiness. VIII. PRAYER FOR RELIEF WHEREFORE, Plaintiffs Catherine Calloway and Michael Calloway pray that the Court grants the following relief as against the Defendant: 1. 2. 3. 4. 5. For Compensatory Damages For Statutory Damages For Punitive Damages For Attorney's Fees and cost incurred in this action; and For such other and further relief as the Court may deem just and proper.

10

Case 1:08-cv-00552-UNA

Document 1

Filed 08/28/2008

Page 11 of 11

JURY TRIAL DEMANDED Plaintiffs demand a Trial by jury on all Issues. This 24th day of August 2008.

LAW OFFICE OF MAGGIE CLAUSELL, LLC, /s/ Maggie Clausell Maggie Clausell, Esq. DE Bar ID #4532 9 E. Loockerman Street, Ste. 205 Dover, DE 19901 302-678-7644 (voice) 302-678-0771 (fax) DATED: August 24, 2008

11

Case 1:08-cv-00552-UNA

Document 1-2

Filed 08/28/2008

Page 1 of 4

Case 1:08-cv-00552-UNA

Document 1-2

Filed 08/28/2008

Page 2 of 4

Case 1:08-cv-00552-UNA

Document 1-2

Filed 08/28/2008

Page 3 of 4

Case 1:08-cv-00552-UNA

Document 1-2

Filed 08/28/2008

Page 4 of 4

Case 1:08-cv-00552-UNA

Document 1-3

Filed 08/28/2008

Page 1 of 6

Case 1:08-cv-00552-UNA

Document 1-3

Filed 08/28/2008

Page 2 of 6

Case 1:08-cv-00552-UNA

Document 1-3

Filed 08/28/2008

Page 3 of 6

Case 1:08-cv-00552-UNA

Document 1-3

Filed 08/28/2008

Page 4 of 6

Case 1:08-cv-00552-UNA

Document 1-3

Filed 08/28/2008

Page 5 of 6

Case 1:08-cv-00552-UNA

Document 1-3

Filed 08/28/2008

Page 6 of 6

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 1 of 9

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 2 of 9

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 3 of 9

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 4 of 9

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 5 of 9

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 6 of 9

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 7 of 9

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 8 of 9

Case 1:08-cv-00552-UNA

Document 1-4

Filed 08/28/2008

Page 9 of 9

Case 1:08-cv-00552-UNA

Document 1-5

Filed 08/28/2008

Page 1 of 1

Case 1:08-cv-00552-UNA

Document 1-6

Filed 08/28/2008

Page 1 of 3

Case 1:08-cv-00552-UNA

Document 1-6

Filed 08/28/2008

Page 2 of 3

Case 1:08-cv-00552-UNA

Document 1-6

Filed 08/28/2008

Page 3 of 3

Case 1:08-cv-00552-UNA

Document 1-7

Filed 08/28/2008

Page 1 of 2

Case 1:08-cv-00552-UNA

Document 1-7

Filed 08/28/2008

Page 2 of 2

Case 1:08-cv-00552-UNA

Document 1-8

Filed 08/28/2008

Page 1 of 5

Case 1:08-cv-00552-UNA

Document 1-8

Filed 08/28/2008

Page 2 of 5

Case 1:08-cv-00552-UNA

Document 1-8

Filed 08/28/2008

Page 3 of 5

Case 1:08-cv-00552-UNA

Document 1-8

Filed 08/28/2008

Page 4 of 5

Case 1:08-cv-00552-UNA

Document 1-8

Filed 08/28/2008

Page 5 of 5

Case 1:08-cv-00552-UNA

Document 1-9

Filed 08/28/2008

Page 1 of 3

Case 1:08-cv-00552-UNA

Document 1-9

Filed 08/28/2008

Page 2 of 3

Case 1:08-cv-00552-UNA

Document 1-9

Filed 08/28/2008

Page 3 of 3

Case 1:08-cv-00552-UNA

Document 1-10

Filed 08/28/2008

Page 1 of 1

Case 1:08-cv-00552-UNA

Document 1-11

Filed 08/28/2008

Page 1 of 1