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Reckelhoff v. Experian Information Solutions, Inc.

United States District Court, N.D. California, Oakland Division

March 31, 2017

DAINA RECKELHOFF, Plaintiff,
v.
EXPERIAN INFORMATION SOLUTIONS, INC, et al., Defendants.

          ORDER GRANTING DEFENDANTS' MOTIONS TO DISMISS DKT. 19, 27, 29, 40

          SAUNDRA BROWN ARMSTRONG, SENIOR UNITED STATES DISTRICT JUDGE

         Plaintiff brings the instant action against Experian Information Solutions, Inc. (“Experian”), Equifax, Inc. (“Equifax”), Chase Bank USA, N.A. (“Chase”)[1] and Capital One claiming that they improperly reported debts or delinquencies on her credit report, without taking into account that the debts were modified under the terms of a confirmed Chapter 13 reorganization plan. The Complaint alleges a claim under the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681s-2(b), against all Defendants; and a claim under the California Consumer Credit Reporting Agencies Act (“CCRAA”), Cal. Civ. Code section 1785.1, et seq., against Chase and Capital One. Plaintiff previously dismissed Capital One from the action.

         The parties are presently before the Court on Experian, Equifax, and Chase's respective motions to dismiss, pursuant to Federal Rule of Civil Procedure 12(b)(6). Dkt. 27, 29, 40. Having read and considered the papers filed in connection with this matter and being fully informed, the Court hereby GRANTS the motions for the reasons set forth below.[2]

         I. BACKGROUND

         A. Factual Summary

         On April 30, 2015, Plaintiff filed for Chapter 13 bankruptcy protection. Dkt. 1 (“Compl.”) ¶ 87. “Chapter 13 of the Bankruptcy Code affords individuals receiving regular income an opportunity to obtain some relief from their debts while retaining their property. To proceed under Chapter 13, a debtor must propose a plan to use future income to repay a portion (or in the rare case all) of his debts over the next three to five years.” Bullard v. Blue Hills Bank, 135 S.Ct. 1686, 1690 (2015). “If the bankruptcy court confirms the plan and the debtor successfully carries it out, he receives a discharge of his debts according to the plan.” Id. at 1690. The Chapter 13 bankruptcy plan was confirmed on June 2, 2015. Compl. ¶ 93. Plaintiff does not allege that she has completed the plan or that any of her debts have been discharged.

         On March 18, 2016, Plaintiff ordered a three-bureau credit report from Experian. Id. ¶ 105. In the report, she “noticed 7 different tradelines … all reporting inaccurate, misleading, or incomplete information that did not comport with credit reporting industry standards.” Id. ¶ 106. These trade lines allegedly reported the accounts “with past due balances, inaccurate balances, and/or with late payments.” Id. Plaintiff also claims that “[s]ome accounts even failed to register that Plaintiff was making payments on the account through Plaintiff's Chapter 13 plan.” Id. On August 5, 2016, she responded to the report by notifying Experian, Equifax and Trans Union LLC that they were “not reporting the bankruptcy accurately or worse not at all.” Id. ¶ 107-108.

         On September 1, 2016, Plaintiff ordered another three bureau credit report from three aforementioned credit reporting agencies to ensure that her accounts had been updated. Id. ¶ 110. However, she found that the Chase and Capital One accounts did not reflect the terms of her Chapter 13 plan. Id. ¶¶ 111-112.

         B. Procedural History

         On November 1, 2016, Plaintiff filed a Complaint in this Court.[3] The first claim is for “Failure to Reinvestigate” under the FCRA, and is brought against all Defendants. As to Chase and WFB, the Complaint alleges that they violated 15 U.S.C. § 1681s-2(b) by furnishing information to a credit reporting agency without conducting “a reasonable investigation and re-reporting misleading and inaccurate account information.” Id. ¶¶ 117-18. Credit reporting agencies Experian and Equifax are alleged to have violated 15 U.S.C. § 1681i(a) by “fail[ing] to conduct a reasonable investigation and fail[ing] to correct the misleading and or inaccurate statements on the account within the statutory time frame or at all.” Id. ¶¶ 128. The second claim, which alleges a violation of the CCRAA, is brought only against Chase and Capital One-the latter of which has since been dismissed from the action. Dkt. 44.

         Experian, Equifax, and Chase have filed separate motions to dismiss, pursuant to Federal Rule of Civil Procedure 12(b)(6), which have been opposed by Plaintiff. The motions are fully briefed and are ripe for adjudication.

         II. LEGAL STANDARD

         Federal Rule of Civil Procedure 12(b)(6) “tests the legal sufficiency of a claim.” Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). “Dismissal under Rule 12(b)(6) is proper when the complaint either (1) lacks a cognizable legal theory or (2) fails to allege sufficient facts to support a cognizable legal theory.” Somers v. Apple, Inc., 729 F.3d 953, 959 (9th Cir. 2013). “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, 570 (2007)). The court is to “accept all factual allegations in the complaint as true and construe the pleadings in the light most favorable to the nonmoving party.” Outdoor Media Group, Inc. v. City of Beaumont, 506 F.3d 895, 899-900 (9th Cir. 2007). Where a complaint or claim is dismissed, leave to amend generally is granted, unless further amendment would be futile. Cervantes v. Countrywide Home Loans, Inc., 656 F.3d 1034, 1041 (9th Cir. 2011).

         III. ...


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