Jones v. Best Serv. Co., No. CV 14-9872 SS, 2017 WL 490902, at *1–10 (C.D. Cal. Feb. 6, 2017), aff'd, 700 F. App'x 580 (9th Cir. 2017)
MEMORANDUM AND ORDER GRANTING MOTION TO DISMISS SECOND AMENDED COMPLAINT WITHOUT LEAVE TO AMEND
SUZANNE H. SEGAL, UNITED STATES MAGISTRATE JUDGE
*1 On September 12, 2016, Plaintiff Wallace Jones (“Plaintiff”), a California resident proceeding pro se, filed the operative Second Amended Complaint (“SAC”) alleging that Defendant The Best Service Company (“Defendant”) violated his rights under the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq. (“FCRA”), and the Fair Debt Collection Practices Act, 15 U.S.C. § 1601 et seq. (“FDCPA”). (Dkt. No. 51). After having successfully moved to dismiss the two prior versions of Plaintiff's claims, on September 29, 2016, Defendant filed its Third Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), (“Third Motion to Dismiss” or “Third MTD,” Dkt. No. 53), including a Memorandum of Points and Authorities, (“Mem.,” Dkt. No. 53-1), and a Request for Judicial Notice. (“D RJN,” Dkt. No. 54). On October 4, 2016, Plaintiff filed an Opposition to the Third Motion to Dismiss, (“Opposition,” Dkt. No. 55), and a Request for Judicial Notice. (“P RJN,” Dkt. No. 56). Defendant did not file a Reply.
The parties have consented to proceed before the undersigned Magistrate Judge pursuant to 28 U.S.C. § 636(c) and Federal Rule of Civil Procedure 73(b). (Dkt. No. 28). For the following reasons, Defendant's Third Motion to Dismiss is GRANTED and this action is DISMISSED without leave to amend and with prejudice.
On December 29, 2014, Plaintiff initiated this action alleging numerous claims for relief under the FCRA and the FDCPA. (“Complaint,” Dkt. No. 1, at 2-9). Defendant moved to dismiss the Complaint on the grounds that: (1) the Complaint failed to allege sufficient facts showing that Plaintiff was entitled to relief; (2) many of Plaintiff's claims were time-barred; (3) some or all of Plaintiff's FCRA claims were not cognizable in a private action; and (4) some or all of Plaintiff's FDCPA claims were not cognizable because they were not triggered by the receipt of an “initial communication” from Defendant. (“First Motion to Dismiss” or “First MTD,” Dkt. No. 13).
The Court granted in part and denied in part the First Motion to Dismiss. (“First Order of Dismissal,” Dkt. No. 37, at 16). The Court determined that Plaintiff's claims were “vague, conclusory, and insufficiently supported by factual allegations.” (See id. at 5-11). The Court further ruled, however, that dismissal on statute of limitations or other “substantive” grounds was premature because the Complaint's vagueness prevented the Court from resolving these issues. (Id. at 12-15). The Court therefore dismissed the Complaint with leave to amend. (Id. at 15-16).
Plaintiff filed a First Amended Complaint on December 23, 2015, in which he again attempted to raise claims under the FCRA and the FDCPA, and, for the first time, the Rosenthal Fair Debt Collection Practices Act, Cal. Civ. Code § 1788 et seq. (“First Amended Complaint” or “FAC,” Dkt. No. 38). Defendant moved to dismiss the FAC on substantially the same grounds raised in its First Motion to Dismiss. (“Second Motion to Dismiss” or “Second MTD,” Dkt. No. 40). The Court granted in part and denied in part the Second Motion to Dismiss, ruling that Plaintiff's allegations “remain[ed] vague, conclusory, and insufficiently supported by factual allegations.” (“Second Order of Dismissal,” Dkt. No. 50 at 12). Because Plaintiff was proceeding pro se and the Court could not “conclusively ascertain” whether leave to amend might cure Plaintiff's allegations, the Court granted Plaintiff “one final opportunity” to amend. (Id. at 12-13 (emphasis in original)). The Court expressly instructed Plaintiff to “omit any claims for which he lacks a sufficient factual basis.” (Id. at 22-23).
*2 Plaintiff filed a three-page Second Amended Complaint on September 12, 2016. The SAC abandons the state law claim alleged in the FAC, and constitutes Plaintiff's third attempt to state a claim under the FCRA and the FDCPA. Defendants responded again with a Motion to Dismiss, which is GRANTED.
PLAINTIFF'S SECOND AMENDED COMPLAINT AND DEFENDANT'S THIRD MOTION TO DISMISS
A. Allegations Of The Second Amended Complaint
Plaintiff generally alleges that Defendant is a business “in the collection of debt” that made “false, deceptive and/or misleading representation[s] in connection with debt collection” against him. (SAC ¶¶ 3, 11). The section of the SAC entitled “General Factual Allegations” reads in its entirety:1
6. On or around April 2009, Defendant entered into Plaintiff's Credit Report.
7. There was no applying for credit or employment with Best Service Company.
8. Defendant, never received consent to obtain Plaintiffs credit file.
9. Defendant continues to furnish inaccurate, erroneous and adverse information on Plaintiffs credit report.
10. Plaintiff sent a notice of dispute, requesting that Defendant provide evidence of some type of contractual obligation and/or document/verify that I owe Defendant the sum of $1, 254.00.2
11. At some time in January 2010 thru 2014, Defendant continues to engage in false, deceptive and/or misleading representation in connection with debt collection.
12. As a direct result Plaintiff's character has been defamed; causing credit denial, credit delays, inability to apply for credit, financial loss, humiliation, mental anguish.
(SAC at 2). The SAC further alleges that on August 15, 2014, Plaintiff's “credit file[ ] reported a balance owe[d] to Defendant in the amount of $1,759.00.” (Id. at 3). Plaintiff also states that on December 16, 2014, his “credit file[ ] reported a balance owe[d] to Defendant in the amount of $1,965.00.” (Id.).
The SAC divides Defendant's alleged violations of the FCRA and the FDCPA into three “counts.” (Id. at 2-3). The first two “counts” allege that Defendant violated the FCRA by willfully “obtaining” Plaintiff's credit “file” in April 2009 without Plaintiff's consent, in violation of the Act's “permissible purpose” requirement. (Id. ¶ 14) (“The April 2009, obtaining of credit file, constitute the violation of permissible purposes of consumer reports ... [because] Defendant is obligated under law to obtain consent from Plaintiff prior to obtaining file.” (Count One)); (id. ¶ 19) (“Defendant knowingly procured Plaintiff report without permissible purpose.” (Count Two)).3 The third “count” alleges that Defendant violated the FDCPA by “misrepresenting the character amount, or legal status of the alleged debt” that Plaintiff owed to Defendant, as reported by Defendant in Plaintiff's credit “file” on August 15, 2014, and December 16, 2014. (Id. at 3). Plaintiff claims under all three counts that Defendant's actions have negatively affected his access to credit on favorable terms, causing him to suffer “substantial credit denial and financial loss.” (Id. at 2-3).
B. Defendant's Third Motion To Dismiss
*3 Defendant argues that Plaintiff's FCRA claims in Counts One and Two are “vague and conclusory” because although Plaintiff broadly asserts that Defendant violated the “permissible purpose rule” for obtaining a consumer credit report, he does not explain “exactly what the violation was and how it related to any alleged damages.” (Third MTD at 6). Defendant also contends that Plaintiff's “no permissible purpose” FCRA claim is a new cause of action not previously alleged and is therefore barred by this Court's prior orders. (Id. at 4-5). In the alternative, Defendant argues that because it is, as the SAC alleges, a debt collector and the assignee of the debt from the original creditor, it had a “permissible purpose” for obtaining Plaintiff's credit report, namely, for use in debt collection activities, as authorized by the FCRA. (Id. at 5) (citing 15 U.S.C. § 1681b (a) (3) (A)). Defendant further notes that section 1681n, cited in Count Two, merely provides for “civil liability for [a] willful violation of another subsection of § 1681... [but] does not create an independent cause of action on its own.” (Id. at 6). Finally, Defendant asserts that Plaintiff's FDCPA claim in Count Three fails because the SAC does not “provide any facts whatsoever as to what, if anything, was misrepresented, why it was incorrect, or how Plaintiff was damaged as a result.” (Id. at 7).
Plaintiff's Opposition argues that: (1) the instant FCRA claims are not barred by the Court's prior orders because the original Complaint raised FCRA claims; (2) even though Defendant “knew or should have known that as a debt collector,” it needed Plaintiff's written permission pursuant to the FCRA to “procure[ ] Plaintiffs report,” “Defendant knowingly procured Plaintiffs report without [Plaintiff's] written consent”; and (3) “Defendant purchased for a few pennies of [sic] the dollar, debt information, that is ‘data’ and proceeded to collect on that unreliable data,” in violation of the FDCPA. (Opposition at 1-3).
STANDARDS GOVERNING DISMISSAL
A Rule 12(b) (6) motion to dismiss for failure to state a claim should be granted if the plaintiff fails to proffer “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Although the plaintiff must provide “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do [,]” Twombly, 550 U.S. at 555, “[s]pecific facts are not necessary; the [complaint] need only give the defendant fair notice of what the ... claim is and the grounds upon which it rests.” Erickson v. Pardus, 551 U.S. 89, 93 (2007) (per curiam) (citations and internal quotation marks omitted).
The court must accept the complaint's allegations as true, Twombly, 550 U.S. at 555-56, construe the pleading in the light most favorable to the pleading party, and resolve all doubts in the pleader's favor. See Berg v. Popham, 412 F.3d 1122, 1125 (9th Cir. 2005). Yet, the court “need not accept as true allegations contradicting documents that are referenced in the complaint or that are properly subject to judicial notice.” Lazy Y Ranch Ltd. v. Behrens, 546 F.3d 580, 588 (9th Cir. 2008). Likewise, “the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions.” Iqbal, 556 U.S. at 678. Pro se pleadings are “to be liberally construed” and are held to a less stringent standard than those drafted by a lawyer. Erickson, 551 U.S. at 94; see also Hebbe v. Pliler, 627 F.3d 338, 342 (9th Cir. 2010) (“Iqbal incorporated the Twombly pleading standard and Twombly did not alter courts' treatment of pro se filings; accordingly, we continue to construe pro se filings liberally when evaluating them under Iqbal.”).
Dismissal for failure to state a claim can be warranted based on either a lack of a cognizable legal theory or the absence of factual support for a cognizable legal theory. See Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). A complaint may also be dismissed for failure to state a claim if it discloses some fact or complete defense that will necessarily defeat the claim. Franklin v. Murphy, 745 F.2d 1221, 1228-29 (9th Cir. 1984).
*4 If the court finds that a complaint fails to state a claim, it must also decide whether to grant the plaintiff leave to amend. Even when a request to amend is not made, “[l]eave to amend should be granted unless the pleading could not possibly be cured by the allegation of other facts, and should be granted more liberally to pro se plaintiffs.” Lira v. Herrera, 427 F.3d 1164, 1176 (9th Cir. 2005) (internal quotation marks omitted). However, if amendment of the pleading would be futile, leave to amend is properly denied. See Ventress v. Japan Airlines, 603 F.3d 676, 680 (9th Cir. 2010); see also Lipton v. Pathogenesis Corp., 284 F.3d 1027, 1039 (9th Cir. 2002) (“Because any amendment would be futile, there was no need to prolong the litigation by permitting further amendment.”); Robinson v. California Bd. of Prison Terms, 997 F. Supp. 1303, 1308 (CD. Cal. 1998) (“Since plaintiff has not, and cannot, state a claim containing an arguable basis in law, this action should be dismissed without leave to amend; any amendment would be futile.”) (citing Newland v. Dalton, 81 F.3d 904, 907 (9th Cir. 1996)).
Other reasons that may warrant the denial of leave to amend include “undue prejudice to the opposing party, bad faith by the movant ... and undue delay.” Cafasso, U.S. ex rel. v. General Dynamics C4 Systems, Inc., 637 F.3d 1047, 1058 (9th Cir. 2011). The proposed addition of new claims unrelated to the claims and defenses in the original complaint may also be grounds for denial of leave to amend. See, e.g., Morongo Band of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990) (denial of leave to amend not abuse of discretion where proposed new claims would have “greatly altered the nature of the litigation” and required defendants to undertake “an entirely new course of defense”); Jackson v. Bank of Hawaii, 902 F.2d 1385, 1387 (9th Cir. 1990) (affirming denial of leave to amend where additional claims “advance different legal theories and require proof of different facts”). In addition, “a district court's discretion over amendments is especially broad where the court has already given a plaintiff one or more opportunities to amend his complaint.” Ismail v. County of Orange, 917 F. Supp. 2d 1060, 1066 (CD. Cal. 2012) (citing DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 186 n.3 (9th Cir. 1987)); see also Cafasso, 637 F.3d at 1058 (“[T]he district court's discretion to deny leave to amend is particularly broad where plaintiff has previously amended the complaint.”) (internal quotation marks omitted).
In its First Order of Dismissal, the Court cautioned Plaintiff to omit from any future pleading claims for which he “lack[ed] a sufficient factual basis” and to “identify the nature of each separate legal claim and make clear what specific factual allegations support each of his separate claims.” (First Order of Dismissal at 15, 17). The Court expressly cautioned Plaintiff that failure to correct these deficiencies would result in dismissal. (Id. at 17). In the Court's Second Order of Dismissal, the Court gave Plaintiff “one final opportunity” to state a viable claim. (Second Order of Dismissal at 13, 21-22). The Court again expressly advised Plaintiff to “identify the nature of each separate legal claim and make clear what specific factual allegations support each of his separate claims” and to “omit any claims for which he lacks a sufficient factual basis.” (Id. at 23).
As discussed below, Plaintiff has again failed to comply with the Court's instructions. The claims in the SAC, like every previous iteration of Plaintiff's claims, are vague, conclusory, and unsupported by sufficiently descriptive or explanatory factual allegations. Accordingly, the Third Motion to Dismiss must be granted. Moreover, because Plaintiff has had multiple opportunities to state a viable claim but has failed to do so, the Court determines that granting further leave to amend would be futile. As such, dismissal is without leave to amend and with prejudice.
A. The Parties' Respective Requests For Judicial Notice
*5 Defendant asks the Court to take judicial notice of the SAC, the Court's two prior Orders of Dismissal in this action, and a Business Entity Detail webpage from the California Secretary of State's website indicating that the status of “The Best Service Co., Inc.” was “ACTIVE” as of September 27, 2016. (Dkt. No. 54). Plaintiff similarly asks the Court to take judicial notice of a Business Entity Detail webpage from the California Secretary of State's website indicating that the status of a similarly-named entity called “Best Service Company” was “SOS/FTB SUSPENDED” as of September 30, 2016; two FTC opinion letters analyzing the FCRA and FDCPA; and the text of these statutes.4 (Dkt. No. 56).
Judicial notice is appropriate of a fact “not subject to reasonable dispute” that can be “accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201. Courts routinely take judicial notice of legislative histories and of other actions filed in the same court or different courts. Hunt v. Check Recovery Systems, Inc., 478 F. Supp. 2d 1157, 1160 (N.D. Cal. 2007) (“A court may also take judicial notice of the legislative history of a statute.”); In re Korean Air Lines Co., Ltd., 642 F.3d 685, 689 n.1 (9th Cir. 2011) (court may take judicial notice of its own records and the records of other courts). The Court therefore GRANTS the request for judicial notice of the prior filings in this action.
However, judicial notice of the other documents identified is unnecessary, as these documents are immaterial to the Court's decision. Because the Court's decision would be the same whether or not it considered these documents, the Court denies the request for judicial notice as moot. See Heinreichs v. Wells Fargo Bank, N.A., 2014 WL 985558, at *3 (N.D. Cal. Mar. 7, 2014) (denying as moot request for judicial notice where it was unnecessary to consider the proffered documents to resolve the motion).
B. Plaintiff's Fair Credit Reporting Act Allegations Fail To State A Claim
“Congress enacted the [FCRA] ... ‘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)). As the Ninth Circuit has explained,
Those [latter] two goals lie in tension, and the FCRA strikes a balance between them. The Act authorizes credit reporting agencies to “furnish ... consumer report[s]” because “[c]onsumer reporting agencies have assumed a vital role in assembling and evaluating consumer credit and other information on consumers.” 15 U.S.C. §§ 1681(a)(3), 1681b(a). At the same time, the FCRA “requir[es] credit reporting agencies to maintain reasonable procedures designed to assure maximum possible accuracy of the information contained in credit reports.”
Pintos v. Pac. Creditors Ass'n, 605 F.3d 665, 674 (9th Cir. 2010) (some citations and internal quotation marks omitted).
*6 In addition, as one court has explained,
The FCRA allows third parties to request, and credit reporting agencies to provide, a consumer's credit report for “ ‘certain statutorily enumerated purposes.’ ” Pintos v. Pac. Creditors Ass'n, 605 F.3d 665, 674 (9th Cir. 2009) (quoting TRW Inc. v. Andrews, 534 U.S. 19, 23 (2001)). Section 1681b of the FCRA lists the circumstances under which consumer reporting agencies may furnish consumer credit reports. 15 U.S.C. § 1681b. Included in this section is the use of consumer reports for debt collection purposes, as long as the obligation owed by the consumer stems from a credit transaction involving the consumer. Id. § 1681b(a)(3)(A).
Rodriguez v. Experian Info. Sols., Inc., 2016 WL 3976564, at *3 (W.D. Wash. July 25, 2016). Just as the FCRA punishes credit reporting agencies for furnishing a consumer credit report in violation of the Act, it also “imposes civil liability on any person who obtains a consumer report for an impermissible purpose.”
Thomas v. Financial Recovery Servs., 2013 WL 387968, at *3 (C.D. Cal. Jan. 31, 2013) (emphasis added); see 15 U.S.C. § 1681b(f) (providing that a “person shall not use or obtain a consumer report for any purpose” other than a purpose authorized under the Act) (emphasis added). Accordingly, to “succeed on a claim under § 1681b, a plaintiff must establish that the defendant did not have a permissible purpose for requesting his credit report.” Thomas, 2013 WL 387968, at *4.
Section 1681b provides, inter alia, that a consumer reporting agency may furnish a credit report either in response to a court order or “[i]n accordance with the written instructions of the consumer to whom it relates.” Id. § 1681b(a) (1-2). Additionally, a consumer reporting agency may furnish a report if the recipient intends to use the information for the following purposes:
in connection with a credit transaction, including the extension, review, or collection of a debt; for employment purposes; in connection with the underwriting of insurance; to determine the consumer's eligibility for a license or other government benefit; to assess risk by a potential investor, servicer, or insurer in connection with an existing credit obligation; in connection with a business transaction initiated by the consumer or to review the consumer's account; and by executive departments and agencies.
Thomas, 2013 WL 387968, at *3 (summarizing 15 U.S.C. § 1681b(a) (3)); see also Pintos, 605 F.3d at 674.
The FCRA creates “a private right of action [under § 1681o] allowing injured consumers to recover any ‘actual damages’ caused by negligent violations and both actual and punitive damages for willful noncompliance [under § 1681n].” Andrews, 534 U.S. at 23. To prove a willful violation, a consumer must show that the defendant violated the FCRA either knowingly or recklessly. Safeco Ins. Co., 551 U.S. at 57.
Plaintiff alleges that, in April 2009, Defendant “intentionally and without justification, willfully failed to comply” with the FCRA by accessing his credit report without a permissible purpose. (SAC at 2-3). According to the SAC, Defendant's lack of a “permissible purpose” is demonstrated by the facts that Plaintiff never applied for “credit or employment with” Defendant and never provided consent for Defendant to access his credit report. (Id. at 2).
*7 The SAC fails to allege a FCRA violation. The SAC provides virtually no factual detail and fails to show how the FCRA even applies in this action. To state a claim under the FCRA, Plaintiff “must allege facts that, if proven, would establish that the defendant did not have a permissible purpose for obtaining the credit report at issue.” Thomas, 2013 WL 387968, at *4. Plaintiff merely highlights three possible “permissible purposes” under the Act and summarily asserts that they do not apply here. This is a legal conclusion, not a factual allegation.
As one court in this district has explained,
[B]are allegations that the defendant did not have a permissible purpose for obtaining a credit report, without more, are insufficient [to state a FCRA claim]. Merely reciting each of the permissible circumstances and denying that they apply is similarly inadequate. Moreover, courts have been especially skeptical of claims brought against debt collection agencies, given that debt collection agencies typically request credit reports for the permissible purpose of seeking the information in connection with the consumer's debt.
Here, Plaintiff has made the conclusory allegation that Defendant did not have a permissible purpose to request her credit report. Plaintiff additionally enumerates each of the permissible circumstances under which a person may request a consumer credit report and alleges that none of these circumstances existed at or about the time Defendant requested Plaintiff's credit report. As such, Plaintiff does no more than make legal conclusions ....
Id. at *4-5 (internal citations and parentheticals omitted); see also Flury v. CSC Credit Servs., 2012 WL 300726, at *1 (D. Ariz. Feb. 1, 2012) (“a single conclusory allegation that [plaintiff's] credit report was ‘obtained without a permissible purpose’ ” failed to state a FCRA claim); Pyle v. First Nat'l Collection Bureau, 2012 WL 1413970, at *3 (E.D. Cal. Apr. 23, 2012) (allegation that “none of the specific and strictly limited circumstances granting [a] permissible purpose under section 1681b applied” to defendant's actions failed to state a claim under § 1681b); Makreas v. The Moore Law Group, A. P.C., 2011 WL 3047634, at *2 (N.D. Cal. July 25, 2011) (“[P]laintiff's conclusory allegation that Moore lacked a ‘permissible purpose’ ... is insufficient to state a claim ... particularly given plaintiff's allegation that Moore is ‘engaged in the business of collecting debts in this state in the ordinary course of business.’ ”); Myers v. Stoneleigh Recovery Assoc., 2012 WL 1356752, at *4-5 (E.D. Cal. Apr. 18, 2012) (plaintiff's conclusory allegation that defendant had pulled credit reports “without a permissible purpose” is “insufficient under Twombly and Iqbal” where plaintiff “also alleged that defendant was attempting to collect a debt from plaintiff,” which suggests a permissible purpose).
Plaintiff's FCRA claims not only consist largely of legal conclusions, but are almost entirely predicated on the erroneous assertion that Defendant was required to secure Plaintiff's express consent to access his credit report for any reason. (SAC at 2-3). For example, Plaintiff's Opposition argues that the Third Motion to Dismiss should be denied because it fails to acknowledge the provision of 15 U.S.C. § 1681b “where it clearly states [that a consumer credit report may be furnished] ‘[i]n accordance with written instructions of the consumer to whom it relates; [that would be the Plaintiff].’ ” (Opposition at 2) (last set of brackets in original). Plaintiff “explains” that “[b]ase[d] upon that section, Defendant had and/or have no consent, no authority to pull/enter into Plaintiff's credit report without ‘written permission.’ ” (Id.).
*8 However, a credit report can be accessed without a consumer's permission for other “permissible purposes” under the FCRA. See, e.g., Bentley v. Greensky Trade Credit, LLC, 156 F. Supp. 3d 274, 296 (D. Conn. 2015) (“Users of credit reports do not always need to obtain written instructions from the consumer before pulling a credit report. The statute provides that one circumstance in which credit reports may be obtained legally is ‘in accordance with the written instructions of the consumer to whom it relates.’ This provision does not apply to every single one of the statute's authorized purposes.” (citations omitted)); Pyle, 2012 WL 1413970, at *3 (“Plaintiff's allegation that he ‘never at anytime [sic] had any business dealing or accounts with the Defendant’ fails to establish that Defendant's activities were impermissible.... Provided that Defendant obtained Plaintiff's consumer report in conjunction with its collection activities, Defendant acted with a permissible purpose under the FCRA.” (certain quotation marks and citations omitted)). Plaintiff's own allegations that Defendant attempted to collect a debt from him strongly support the conclusion that Defendant was not required to secure Plaintiff's permission to access his credit report. See Salmas v. Portfolio Recovery Associates, LLC, 2013 WL 6182614, at *3 (CD. Cal. Nov. 25, 2013) (“[B]y alleging that [defendant] obtained his consumer report and then attempted to collect a debt, [plaintiff] has pled himself out of his FCRA claim by including details contrary to his claim.”).
Plaintiff's allegations under the FCRA do not permit the Court to “draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. Accordingly, the Court GRANTS Defendant's Third Motion to Dismiss to the extent that it seeks dismissal without leave to amend of Plaintiff's FCRA claims.5
C. Plaintiff's Fair Debt Collection Practices Act Allegations Fail To State A Claim
“Congress enacted the FDCPA to protect consumers from ‘improper conduct’ and illegitimate collection practices ‘without imposing unnecessary restrictions on ethical debt collectors.’ ” Clark v. Capital Credit & Collection Servs., Inc., 460 F.3d 1162, 1169-70 (9th Cir. 2006) (citation omitted); Good v. Nationwide Credit, Inc., 137 F. Supp. 3d 794, 800 (E.D. Pa. 2015). “There are four elements to an FDCPA cause of action: (1) the plaintiff is a ‘consumer’ under 15 U.S.C. § 1692a(3); (2) the debt arises out of a transaction entered into for personal purposes; (3) the defendant is a ‘debt collector’ under 15 U.S.C. § 1692a(6); and (4) the defendant violated one of the provisions contained in 15 U.S.C. §§ 1692a-1692o.” Wheeler v. Premiere Credit of North America, LLC, 80 F. Supp. 3d 1108, 1112 (S.D. Cal. 2015) (citing Turner v. Cook, 362 F.3d 1219, 1226-27 (9th Cir. 2004)). Section § 1692e provides in relevant part that a debt collector violates the FDCPA when it falsely represents “the character, amount, or legal status of any debt.” 15 U.S.C. § 1692e(2); see also Schlegel v. Wells Fargo Bank, NA, 720 F.3d 1204, 1208 (9th Cir. 2013).
The SAC summarily alleges, without any supporting facts, that “[a]t some time in January 2010 thru 2014, Defendant continues to engage in false, deceptive and/or misleading representation in connection with debt collection.” (SAC at 2). The SAC further states that in August and December 2014, Plaintiff's credit “file” reported that Plaintiff owed Defendant $1,759 and $1,965 respectively. (SAC at 2–3). (Id.). Plaintiff concludes that Defendant violated the FDCPA by “misrepresenting the character[,] amount, or legal status of the alleged debt.” (Id. at 3) (quoting in relevant part 15 U.S.C. § 1692e (2) (A)).
The SAC fails to allege a FDCPA violation because it utterly fails to show what Defendant did or explain how Defendant's purported actions violated the FDCPA. Plaintiff admits in his Opposition to the Third Motion to Dismiss that the “alleged balance owed once upon a time [i.e., April 2009] was $1,254.00. This is an undeniable fact.” (Opposition at 3) (emphasis added). The reasonable inference from this admission is that Plaintiff's unpaid debt of $1,254 in April 2009 (see SAC ¶¶ 6, 10) grew, through the imposition of late fees and/or interest, to $1,759 in August 2014 and $1, 965 in December 2014. The SAC's bare assertion that Defendant “misrepresented” the amount owed, unsupported by any facts whatsoever to explain why the amounts allegedly reported were false, is insufficient to state a claim.6 See Wynne v. I.C. Sys., Inc., 124 F. Supp. 3d 734, 742 (E.D. Va. 2015) (plaintiff failed to state a claim under the FDCPA based on debt collector's “misrepresentation” of the debt where the complaint did not (1) “explain by what conduct, or to whom, the Defendants made any ‘false representation of the character, amount, or legal status of any debt’ in connection with the collection of the debt at issue,” (2) “allege why collection of the debt ... was not legally permitted,” or (3) identify “what form of ‘actual damages’ she has suffered”); Dias v. Federal Nat. Mortg. Ass'n, 990 F. Supp. 2d 1042, 1054 (D. Hawai'i 2013) (bare allegations that defendant “did not own the debt or misrepresented in the public record that it owned the debt do not state claims for violations of the FDCPA”); Dikun v. Streich, 369 F. Supp. 2d 781, 787 (E.D. Va. 2005) (“conclusory legal assertions” without any “facts that would constitute a false, deceptive, or misleading representation” do not state a claim under the FDCPA); Rector v. Toyota Motor Credit Corp., 2013 WL 1331447, at *6 (E.D. Cal. Apr. 2, 2013) (complaint failed to state an FDCPA claim because it did not “allege any non-conclusory facts suggesting harassment, false misrepresentations, or unfair practices by defendant”); Gomes v. Mortg. Elec. Registration Sys., Inc., 2012 WL 370542, at *5 (E.D. Cal. Feb. 3, 2012) (plaintiff's “vague and conclusory” reference to defendant's “false representations, deceptive means, and actions,” in the absence of “specific facts regarding any improper debt collection efforts[,] ... fails to state a claim for violation of the FDCPA”); Chyba v. Green Tree Servicing, LLC, 586 Fed.Appx. 397, 398 (9th Cir. 2014) (dismissal of FDCPA claims was warranted where plaintiff “failed to allege facts sufficient to show ... that [defendant debt collector] used any false representation in connection with the collection of a debt”).
*9 Like the SAC's FCRA claims, Plaintiff's exceedingly sparse FDCPA allegations are nothing more than legal conclusions that do not permit the Court to “draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. Accordingly, the Court GRANTS Defendant's Third Motion to Dismiss to the extent that it seeks dismissal of Plaintiff's FDCPA claims.
D. Granting Further Leave To Amend Would Be Futile
Federal Rule of Civil Procedure 15(a)(2) provides that where, as here, the time for amendment of a pleading “as a matter of course” has lapsed, “a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely grant leave when justice so requires.” However, if amendment of the pleading would be futile, leave to amend is properly denied. See Ventress, 603 F.3d at 680.
The district court's discretion to deny leave to amend is “particularly broad” where, as here, the plaintiff has previously filed an amended complaint. Cafasso, 637 F.3d at 1058; see also Zucco Partners, LLC v. Digimarc Corp., 552 F.3d 981, 1007 (9th Cir. 2009) (failure to correct deficiencies in amended complaint was “a strong indication that the plaintiffs ha[d] no additional facts to plead”); Salameh v. Tarsadia Hotel, 726 F.3d 1124, 1133 (9th Cir. 2013) (leave to amend properly denied when “the district court gave Plaintiffs specific instructions on how to amend the complaint, and Plaintiffs did not comply”).
Here, the Court has repeatedly explained the deficiencies in Plaintiff's pleadings and afforded Plaintiff several opportunities to amend. (First Order of Dismissal at 5-11, 15-16; Second Order of Dismissal at 12-22). Instead of correcting these deficiencies, Plaintiff has filed only vague complaints. Moreover, Plaintiff's Opposition failed to provide any additional details or further argument to explain how Plaintiff could correct the deficiencies in the SAC. (Opposition at 1-3). Even if the Court were to disregard Plaintiff's patently incorrect legal contention that Defendant was required to secure his written permission to obtain his credit report for any purpose—the Court still does not know, despite Plaintiff's three attempts to state a claim:
● what Plaintiff's underlying debt was for, its amount, the holder of the debt, and whether Plaintiff believes it was legitimately owed to the underlying creditor;
● why the “debt information” that Defendant purchased in Plaintiff's “credit file” was “unreliable,” and how Defendant could have known it was unreliable (Opposition at 3);
● whether the “notice of dispute” that Plaintiff allegedly sent to Defendant challenged Defendant's right to collect on the debt, or the amount of the debt (SAC ¶ 10);
● why Plaintiff believes that the amounts owed to Defendant pursuant to his August 2014 and December 2014 credit reports are incorrect (id. ¶¶ 21-23);
● what Plaintiff believes Defendant's “impermissible purpose” was in obtaining his credit report, if not for use in debt collection (id. ¶ 14);
● how, when, and to whom “Defendant is misrepresenting the character, amount, or legal status of the alleged debt” (id. ¶ 23); and
● what Plaintiff believes Defendant did with the information it obtained in his credit report and how Defendant's use of this information directly harmed him.
Plaintiff has repeatedly failed to comply with the Court's instructions regarding how to state a cognizable claim under the FCRA or FDCPA. Salameh, 726 F.3d at 1133. Plaintiff's filings, including his amended complaints and his oppositions to Defendant's motions to dismiss, confirm that Plaintiff has “no additional facts to plead.” Zucco Partners, 552 F.3d at 1007. Accordingly, the Court concludes that granting further leave to amend would be futile.
*10 Consistent with the foregoing, IT IS ORDERED that Defendant's Third Motion to Dismiss is GRANTED without leave to amend. Judgment shall be entered DISMISSING this action with prejudice.
Not Reported in Fed. Supp., 2017 WL 490902
The Court will not attempt to correct or highlight the SAC's numerous grammar and punctuation errors because they are not, by themselves, critical impediments to the comprehension of Plaintiff's claims.
It is unclear whether Plaintiff contends that (1) he does not owe Defendant any amount of money at all, or (2) the amount that he owes Defendant is not the amount reported by Defendant.
The SAC's first two “counts” purport to rely on two different sections of the FCRA. The section cited in Count One specifies the circumstances in which a consumer credit reporting agency may furnish a credit report, which include, but are not limited to, the provision of a report “[i]n accordance with the written instructions of the consumer to whom it relates.” See 15 U.S.C. § 1681b(a)(2). The section cited in Count Two sets the penalties for a willful violation of “any requirement” of the FCRA. See 15 U.S.C. § 1681n. Because the facts underlying the two FCRA “counts” are identical, and the gravamen of the “claim” in Count Two is simply that the actions alleged in Count One were willful, this Order will address the two FCRA “counts” together as though they formed a single claim.
The two corporations for which the Parties submitted information from the California Secretary of State's website do not appear to be the same entity. Despite the similarity of names, which are nonetheless not identical, the companies have different California entity numbers, business filing dates, addresses, and agents for service of process. (Compare D RJN, Exh. 3, with P RJN, Exh. 1).
The FTC Opinion Letters submitted by Plaintiff are an October 1998 opinion concerning the FCRA's application to brokerage clients, (id., Exh. 2), and a December 1997 opinion regarding whether and when the FDCPA permits a debt collector to report a “charged off debt” to a consumer reporting agency. (Id., Exh. 3). Neither opinion letter applies to the facts in this case.
Because Plaintiff fails to state a cognizable FCRA claim, the SAC necessarily fails to allege facts showing that Defendant's purported violation was “willful.” Similarly, because the SAC's failure to state a FCRA claim is dispositive, the Court need not address whether Plaintiff's current FCRA claims violate the Court's instruction not to include new causes of action in a Second Amended Complaint. (Second Order of Dismissal at 22; Mem. at 4-5).
Notably, the SAC's factual allegations are very similar to the allegations that the Court found insufficient to state a claim under the FDCPA in the FAC. (See Second Order of Dismissal at 17 (“[T]he First Amended Complaint contains only two specific factual allegations concerning Defendant's conduct: in 2009, Defendant ‘entered into’ Plaintiff's credit report alleging that Plaintiff owed it a debt of $1, 254; and, in November 2014, Plaintiff sent Defendant a ‘request for validation’ and ‘Notice of Settlement Offer’ regarding the debt, but Defendant did not respond as required by law within 5 days of initial communication.” (citation and some internal quotation marks omitted)).
Jones v. Best Serv. Co., No. CV 14-9872 SS, 2017 WL 490902, at *1–10 (C.D. Cal. Feb. 6, 2017), aff'd, 700 F. App'x 580 (
Who can pull a credit report and when can they pull it.
Jones v. Best Serv. Co., No. CV 14-9872 SS, 2017 WL 490902, at *1–10 (C.D. Cal. Feb. 6, 2017), aff'd, 700 F. App'x 580 (
David A. Szwak
Bodenheimer, Jones & Szwak, LLC
416 Travis Street, Suite 1404, Mid South Tower
Shreveport, Louisiana 71101
318-424-1400 / Fax 221-6555
President, Bossier Little League
Chairman, Consumer Protection Section, Louisiana State Bar Association
Bodenheimer, Jones & Szwak, LLC
416 Travis Street, Suite 1404, Mid South Tower
Shreveport, Louisiana 71101
318-424-1400 / Fax 221-6555
President, Bossier Little League
Chairman, Consumer Protection Section, Louisiana State Bar Association
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