Mental/Emotional Damages: More Than Mere Anger: Must Read!!!

David A. Szwak

Mental/Emotional Damages: More Than Mere Anger: Must Read!!!

Postby David A. Szwak » Sun Oct 23, 2005 9:31 pm

Comeaux v. Experian Information Solutions
Not Reported in F.Supp.2d, 2004 WL 1354412
Jun 08, 2004

Generally, evidence of a genuine injury must be present when a party seeks damages for emotional distress. See Carey v. Piphus, 435 U.S. 247, 98 S.Ct. 1042, 1052, 55 L.Ed.2d 252 (1978). Furthermore, the evidence presented must have "a degree of specificity which may include corroborating testimony or medical or psychological evidence ..." See Cousins v. TransUnion Corp., 246 F.3d 359, 371 (5th Cir.2001) [emphasis added]. Evidence showing only that a party felt frustrated, real bad, angry, or irritated is insufficient under Cousins to recover for damages for emotional distress. See Patterson v. P.H.P. Healthcare Corp., 90 F.3d 927, 938 (5th Cir.1996); see also Cousins, 246 F.3d at 371.

The Fifth Circuit, has demonstrated that actual damages under the FCRA may include humiliation or mental distress. See Comeaux depo., pp. 238-239, 246- 254; see also Fischl v. GMAC, 708 F.2d 143 (5th Cir.1983). In Stevenson v. TRW, the Court held that the plaintiff had suffered mental anguish from the FCRA violation of the defendant. Specifically, the Court found that the plaintiff's distress was a result of his extensive dealings with the defendant after he disputed his credit report, and that he was denied credit three times. See Stevenson v. TRW Inc., 987 F.2d 288, 296-97 (5th Cir.1993). As a result, the plaintiff had to continually explain his credit woes and further testified to experiencing considerable embarrassment from having to "detail to business associates and creditors his problems with [the defendant]." Id.

The Fifth Circuit upheld another award of actual damages for similar evidence of mental distress in Pinner. See Pinner v. Schmidt, 805 F.2d 1258, 1265 (5th Cir.1986), cert. Denied, 483 U.S. 1022, 107 S.Ct. 3267, 97 L.Ed.2d 766 (1987). The plaintiff in Pinner was awarded for mental distress due to humiliation and embarrassment resulting from three credit denials and lengthy dealings with the credit bureau. Id. Furthermore, another plaintiff received damages as a result of humiliation and embarrassment suffered from three denials of credit and from the fact that the credit bureau took several months to correct the credit report's inaccuracies. See Thompson v. San Antonio Retail Merchants Assn., 682 F.2d 509, 513-14 (5th Cir.1982).

The evidence presented in this case demonstrates that Comeaux also suffered three credit denials and likewise endured a sense of humiliation and embarrassment. She has stated that her personal life has come to a stand still, and that she has been unable to further her standard of living and provide for her child in a manner consistent with her true credit worthiness. See Comeaux depo., pp. 238-239, 246-254. Additionally, she has indicated strong feelings of embarrassment each and every time that she has to discuss her credit problems, whether it be with businesses (when she has to explain her mixed file problem, or being denied credit in public), family members, or even her attorney. The duration for which Comeaux has had to deal with her mixed credit file, since her initial 1999 communications with Experian, has caused her to feel as though her efforts to correct any inaccuracies is now a "losing battle." See Comeaux depo., p. 238.

The detailed events describing each time that Comeaux is denied credit or when she is trying to correct her credit, has provided the Court with sufficient evidence to find that a genuine issue of material fact remains as to her mental distress claims. Comeaux has further provided the Court with enough specificity through her deposition testimony to satisfy Cousins, and further remain consistent with other Fifth Circuit case law as mentioned above. The "evaluation of plaintiff's emotional distress claim is a task best left for the jury[.]" See Kronstedt v. Equifax, 2001 WL 34124783, at 12 (W.D.Wis. Dec.14, 2001).

David A. Szwak

Postby David A. Szwak » Thu Nov 03, 2005 1:28 pm

A claim for mental distress damages under Fair Credit Reporting Act (FCRA) must be supported by something more than plaintiff's own conclusory allegations; support can come from the surrounding circumstances or other evidence of genuine injury, such as the evidence of the injured party's conduct and the observations of others.

Riley v. Equifax Credit Information Services
194 F.Supp.2d 1239

David A. Szwak

Postby David A. Szwak » Fri Nov 11, 2005 2:43 pm

Reed v. Experian Information Solutions, Inc.
321 F.Supp.2d 1109

Plaintiff also alleges that he has suffered "severe emotional distress." (Compl. ¶¶ 64, 74 & 108.) In federal causes of action, claims of emotional distress generally "must be supported by evidence of a genuine injury, such as evidence of the injured party's conduct and the observations of others." See Cousin v. Trans Union, 246 F.3d 359, 371 (5th Cir.2001) (citing Carey v. Piphus, 435 U.S. 247, 98 S.Ct. 1042, 55 L.Ed.2d 252 (1978)). The Fifth Circuit reached the same conclusion regarding emotional distress claims in discrimination cases. See id. (citing Patterson v. P.H.P. Healthcare Corp., 90 F.3d 927, 938 (5th Cir.1996)). The Eighth Circuit Court of Appeals has held that emotional distress claims "must be supported by competent evidence of genuine injury." Forshee v. Waterloo Indus., Inc., 178 F.3d 527, 531 (8th Cir.1999) (considering viability of emotional distress claims in the context of Title VII). Plaintiff's evidence consists of his vague testimony that "it's not a good feeling," that he is "emotional" and "pissed about the whole thing." (Reed Dep. at 302-06.) This is just the kind of evidence the Eighth Circuit deemed inadequate in Forshee. See id. at 531. Plaintiff has not presented evidence of a genuine injury caused by defendants' wrongful conduct. In sum, plaintiff has not shown that he has suffered any actual damages that *1116 were caused by defendants' alleged misconduct.

David A. Szwak

Postby David A. Szwak » Sun Dec 25, 2005 9:26 pm

McKeown v. Sears Roebuck & Co.
335 F.Supp.2d 917
Jul 28, 2004

Defendants CSC and Equifax argue alternatively that they are entitled to summary judgment because plaintiff has failed to show that he suffered any actual damages as a result of any credit history report either defendant issued. Actual damages for Fair Credit Reporting Act violations may include out-of-pocket losses, damages for injury to reputation and creditworthiness and for humiliation or mental distress. Cousin v. Trans Union Corp., 246 F.3d 359, 376 (5th Cir.2001). In order to obtain an award of "actual damages," a plaintiff must present evidence showing a "causal relation between the violation of the statute and the loss of credit, or some other harm ...." Crabill, 259 F.3d at 664. Defendants CSC and Equifax argue that plaintiff was able to secure a mortgage for the property he sought to purchase and that the lender never saw a credit report that either had issued.
Plaintiff argues that he was forced to accept a five-year adjustable-rate loan rather than the thirty-year fixed-rate mortgage that he sought because the five-year loan could be obtained by using the single credit history from Experian, the single credit reporting agency that had not reported plaintiff to be deceased in the information it provided Factual Data. (The notation of deceased on the Sears tradeline on the merged credit report from Factual Data came from defendant Trans Union and not from defendants CSC or Equifax. However, defendant Equifax did report to defendant Factual Data that plaintiff was deceased in place of providing a credit score for him. Factual Data noted this on its report.)
Plaintiff maintains that he had no choice but to accept the five-year mortgage; however, his evidence belies this assertion. According to plaintiff's wife, "the best thirty-year rate that was available to us was at 5.625%. [Plaintiff] declined that option." Joan McKeown Aff., dkt. # 65, ¶ 22. In addition, she testified that the rates for the *932 loan plaintiff accepted instead were 4.125% for five years, followed by then current interest rates not to exceed 9.125%. Plaintiff has not pointed to any evidence showing what kind of interest rate he might have obtained had it not been for the notation of deceased. In support of his proposed finding of fact that he was "forced to close his mortgage on less favorable terms because he was limited to those types of loans that could be obtained with a credit report from only Experian," plaintiff cites the affidavit of his mortgage broker, Thomas Duffy, in which Duffy states only that the terms of the adjustable rates loan were "quite different" from those of a traditional thirty-year loan. PPFOF, dkt. # 55, at 7, ¶ 58 (citing Duffy Aff., dkt. # 57, ¶¶ 17-19). Plaintiff has not adduced any evidence from which a jury could approximate the value of the risk. It is only speculation that market rates may be less favorable in five years. Because plaintiff has failed to show that he could support his assertion that his mortgage terms are less favorable than those he would have been able to obtain had it not been for the deceased notations, he will not be allowed to seek damages on this basis.
[15] Plaintiff contends that even if he cannot prove that he obtained less favorable loan terms, he should be able to recover actual damages for his mental distress, loss of sleep, nervousness and injury to reputation, work, family and sense of well being. "[A] denial of credit is not a necessary prerequisite for a § 1681e(b) claim"; damages for emotional distress may also be compensable. Kronstedt v. Equifax, CSC, 2001 WL 34124783, at *11 (W.D.Wis.2001). See also Cousin, 246 F.3d at 369 n. 15; Guimond v. Trans Union Credit Information Co., 45 F.3d 1329, 1333 (9th Cir.1995).
[16] [17] First, defendant CSC contends that plaintiff's evidence of emotional distress is conclusory and therefore, insufficient. I disagree. In order to survive summary judgment on an emotional distress claim, a plaintiff must submit evidence that " 'reasonably and sufficiently explains the circumstance of his injury and does not resort to mere conclusory statements.' " Kronstedt, 2001 WL 34124783, at *12 (quoting United States v. Balistrieri, 981 F.2d 916, 932 (7th Cir.1992)). Plaintiff has submitted an affidavit from his wife, chronicling a change in plaintiff's behavior (subdued, stunned and distracted behavior), physical manifestations (flushing), restless sleeping between the time he learned of the notation of deceased until the mortgage closed and anxiety about the possibility of other credit errors, such as having a credit card denied in front of a business associate. PPFOF, dkt. # 55, at 10, ¶ 78 (citing Joan McKeown Aff., dkt. # 64, ¶¶ 11-18, 19-26, 45-50 and 63-75). This evidence is far more specific than the testimony that other courts have held to be too conclusory, e.g., Cousin, 246 F.3d at 370-71 (plaintiff testified that he felt "very upset [and] angry"); Schmit v. Trans Union LLC, 2004 WL 785098, at *4 (N.D.Ill. April 12, 2004) (blank assertion of emotional distress and no evidence linking it to erroneous report), and in fact, is more specific than evidence found to be sufficiently particular, e.g., Kronstedt, 2001 WL 34124783, at *12 (description of depth of frustration). In making its argument, defendant CSC relies on case law setting out standards for evaluating evidence " 'when the injured party provides the sole evidence of mental distress.' " Dft. CSC's Br., dkt. # 36, at 12-14 (quoting Biggs v. Village of Dupo, 892 F.2d 1298, 1304 (7th Cir.1990)). Notably, defendant CSC does not address the testimony of plaintiff's wife to which plaintiff referred in his proposed findings of fact relating to his alleged mental distress.
*933 [18] [19] Next, defendant CSC argues that damages for emotional distress under the act " 'must result from the publication of the inaccurate information to a third party.' " Id. at 10 (quoting Sarver v. Experian Information Solutions, Inc., 299 F.Supp.2d 875, 877 (N.D.Ill.2004)). Defendant relies on the holding in Casella v. Equifax Credit Information Services, 56 F.3d 469 (2d Cir.1995). In rejecting the testimony of the plaintiff and his companion regarding the apprehension and anxiety that the plaintiff felt over the prospect of dealing with the erroneous report, the court held that "a plaintiff can [not] recover for pain and suffering when he has failed to show that any creditor or other person ever learned of the derogatory information from a credit reporting agency." Id. at 475. The court derived its rule from the requirement that a plaintiff show that the defendant's actions caused the injury. To the extent that this rule relates to emotional distress caused by the embarrassment, I agree with it. A defendant cannot be held liable for the embarrassment a party suffers as a result of others learning of the derogatory information unless that defendant is responsible for their finding out. (For example, plaintiff cannot recover for the embarrassment he alleges to have suffered because a number of people in his community knew about the situation; they learned of the deceased notation from a television story that plaintiff's wife instigated and not from any defendant.)
However, it makes no sense to apply this requirement to other types of emotional distress. A consumer may suffer distress if he has difficulty in correcting his credit history or trouble managing his finances until his history is corrected; this is true regardless whether his erroneous information was actually published to a third party. The holding in Casella implies that recoverable emotional distress is limited to that caused by embarrassment or humiliation, id. at 475 (party cannot recover emotional distress damages "simply because he knew of an inaccurate and potentially damaging item in his credit report"; rejecting testimony about depression and anxiety suffered as a result of dealing with error), but the court provided no explanation for such a limitation. Other courts have routinely assumed or suggested that emotional distress damages are available when a party experiences a significant frustration and anxiety brought on by failed attempts to have the errors corrected. See, e.g., Cousin, 246 F.3d at 369 n. 15 (suggesting that recovery is available for mental distress other than embarrassment); Guimond v. Trans Union Credit Information Co., 45 F.3d 1329, 1332 (9th Cir.1995) (emotional distress "resulting from the incorrect information in her credit report"; no indication of publication to third party); Stevenson v. TRW, Inc., 987 F.2d 288, 297 (5th Cir.1993) (emotional distress resulting from shock of learning of bad credit record); Kronstedt, 2001 WL 34124783, at *12 (frustration over repeated failed attempts to have error corrected). I can think of no reason for allowing consumers to recover for the humiliation and embarrassment of having bankers and mortgage brokers learn of the derogatory credit information while barring them from recovering for the anxiety and stress they may encounter in coping with the error.
[20] In this case, plaintiff relies on the testimony of his wife regarding the frustration and anxiety he suffered for fear that he would lose the property he wished to purchase and that the error might cause other credit related problems. Although it is difficult to imagine that plaintiff suffered much emotional distress as a result of the notation of deceased reported by defendants CSC and Equifax when only a week elapsed between the time that plaintiff learned that he had been reported as deceased *934 and defendant CSC informed him that it had deleted the Sears tradeline, "evaluation of plaintiff's emotional distress claim is a task best left to the jury." Kronstedt, 2001 WL 34124783, at *13.
(Of course, in this case, the deceased notation was published to a third party: Duffy. This third party publication exemplifies the absurdity of applying the rule that the erroneous information must be published to a third party on claims of mental distress not arising out of embarrassment. None of plaintiff's stress is derived from the fact that Duffy knew of the notation; if anything, Duffy alleviated the stress by quickly finding an alternative loan to finance plaintiff's purchase. Even if the erroneous notation had been published broadly, it is difficult to conceive how this would have lead to emotional distress; anyone plaintiff may have encountered would have known that he was not deceased and therefore, that the notation was in error.)

David A. Szwak

Postby David A. Szwak » Sun Dec 25, 2005 9:38 pm

Acton v. Bank One Corp.
293 F.Supp.2d 1092
Nov 07, 2003

Damages recoverable under the FCRA "include humiliation or mental distress, even if the consumer has suffered no out-of-pocket losses" due to a denial of credit. Stevenson v. TRW Inc., 987 F.2d 288, 296 (5th Cir.1993). "Courts have allowed recoveries where ... the plaintiff suffered mental anguish based on events other than a denial of credit." Zala, 2001 WL 210693, at *7 (citations omited). See Guimond, 45 F.3d at 1333 ("[N]o case has held that a denial of credit is a prerequisite to recovery under the FCRA."). Plaintiff claims that Equifax's failure to correct his credit report and the continuing hassle to correct the error "devastated" him and his wife. Plaintiff claims he had to take unpaid leave from work so he could deal with the stress of the credit situation, had difficulty sleeping, and was required to take large amounts of Tylenol. Plaintiff also claims that he was embarrassed by the fact that others in the community unjustifiably perceived him and his wife as bankrupt.Equifax contends that Plaintiff's allegations are insufficient evidence of emotional distress injury. Equifax cites to Cousin v. Trans Union Corp., 246 F.3d 359, 371 (5th Cir.2001), for the proposition that a Plaintiff alleging intangible loss must set forth evidence with "a degree of specificity which may include corroborating testimony or medical or psychological evidence in support of the damage award." Id. (citations omitted). Other courts have disagreed. See, e.g., Kronstedt v. Equifax, 2001 WL 34124783, at *12 (W.D.Wis. Dec. 14, 2001) (distinguishing Cousin, recognizing *1101 that the Seventh Circuit "has held that the injured party's testimony alone may be sufficient to establish emotional distress, so long as the injured party reasonably and sufficiently explains the circumstances of his injury and does not resort to mere conclusory statements") (internal quotations, brackets, and citations omitted). The Kronstedt court concluded that the "evaluation of plaintiff's emotional distress claim is a task best left for the jury [.]" Id. The Ninth Circuit has not addressed the type of evidence necessary to support an award of emotional distress damages under the FCRA, but has stated in other contexts that "[w]hile objective evidence requirements may exist in other circuits, such a requirement is not imposed by case law in the Ninth Circuit, or the Supreme Court." Zhang v. Am. Gem Seafoods, Inc., 339 F.3d 1020, 1040 (9th Cir.2003) (holding in a discrimination action that the plaintiff's "testimony alone is enough to substantiate the jury's award of emotional distress damages") (ellipsis and citations omitted). See also Johnson v. Hale, 13 F.3d 1351, 1352-53 (9th Cir.1994) (recognizing that "compensatory damages may be awarded for humiliation and emotional distress established by testimony or inferred from the circumstances, whether or not plaintiffs submit evidence of economic loss or mental or physical symptoms."). Equifax also cites to Price v. City of Charlotte, 93 F.3d 1241, 1248-54 (4th Cir.1996), as support for its contention that emotional distress damages must be supported by evidence of genuine injury. The Ninth Circuit stated in Zhang, however, that the "holding of Price that 'the evidence of the emotional distress must be demonstrable, genuine, and adequately explained,' is not the law of this Circuit[.]" Zhang, 339 F.3d at 1040 (citing Price, 93 F.3d at 1251). The Court therefore declines to follow Price in this case.
[22] While the Plaintiff certainly has not offered overwhelming evidence of emotional distress damages, the evidence is sufficient to create a question for the jury, particularly when all factual disputes and possible inferences are resolved in the Plaintiff's favor. The Court will therefore deny Equifax's motion for summary judgment regarding emotional distress damages.

D. Other Damages.
[23] [24] Plaintiff has made a number of generalized statements in his pleadings concerning damages allegedly suffered as a result of Equifax's actions. These include his alleged inability to purchase a home from 1999 until April 2000, the termination of two credit accounts allegedly related to his bad credit, and damages suffered in relation to inaccurate credit reports he obtained on July 14, 1999 and September 17, 1999. Plaintiff has provided the Court with no specific information concerning these alleged injuries, and it is not the Court's duty to search the record for evidence on which to deny summary judgment. Forsberg v. Pac. N.W. Bell Tel. Co., 840 F.2d 1409, 1417- 18 (9th Cir.1988). Because Plaintiff has failed to support his generalized allegations of damages with specific evidence, they will be eliminated by summary judgment. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) (Federal Rule of Civil Procedure 56(c) "mandates the entry of summary judgment ... against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.").

Return to “Damages Under FCRA”

Who is online

Users browsing this forum: No registered users and 2 guests