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FRCP 56[e]: Affidavit Form and Content: MSJ

Posted: Mon Sep 29, 2014 11:59 pm
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FRCP 56[e]: Affidavit Form and Content: MSJ


Roberts v. Trans Union LLC
Slip Copy, 2007 WL 1308682
May 03, 2007


D. Proximate Cause and DamagesFN9

FN9. Roberts claims actual and punitive damages. Punitive damages are only available for willful noncompliance. Because Roberts has not made out a claim for willful noncompliance, punitive damages are not available in this case. 15 U.S.C. § 1681n.

1. The Standard

*8 A plaintiff may establish actual damages by producing sufficient evidence from which a reasonable trier of fact that the inaccurate entry was a “substantial factor” that brought about the denial of credit. Philbin v. Trans Union, 101 F.3d 957 (3rd. Cir.1996); Garrett v. Trans Union, L.L.C., 2006 WL 2850499 at *10 (S.D.Ohio). A plaintiff may also establish actual damages by explaining in sufficient detail the emotional distress and humiliation resulting from his knowledge that a CRA distributed a credit report containing inaccurate information to a third-party. Bryant, 487 F.Supp. at 1240; Garrett, WL 2850499 at * 11-12.

As to the scope of liability, a CRA is not liable under the FCRA for reporting inaccurate information obtained from a [presumptively reliable source], absent prior notice from the consumer that the information may be inaccurate. Anderson v. Trans Union, LLC, 345 F.Supp.2d 963, 971 (W.D.Wis.2004) (citing, Henson v. CSC Credit Services, 29 F.3d 280, 285 (7th Cir.1994)). Moreover, potential liability is not triggered until 30 days after the CRA receives the consumer's dispute. 15 U.S.C. § 1681i(a)(1)(A). Accordingly, the relevant time frame in which to evaluate Roberts' claim is from June 29, 2005 (30 days after Trans Union received Roberts' dispute) to June 27, 2006 (the date on which the Countrywide account information was removed.)

2. Trans Union's Motion to Strike Joe Rapadas' Affidavit

a. Description of the Affidavit

With regards to whether Roberts has established a genuine question issue of fact as to actual damages, the Court must first determine whether Rapadas' affidavit is admissible. To support his claim that he was denied credit on the basis of the open and late status of account # 9689. Robert proffers the affidavit of financial consultant Joe Rapadas (Rapadas). Rapadas states in his affidavit that from March, 2005 and for several months thereafter, he attempted to find a lender willing to refinance Roberts' home at a lower rate. Rapadas says that in March, 2005 and in August, 2005 he ran credit reports which showed that account # 9689 was open and past due. Rapadas said that he was unsuccessful in finding Roberts a new lender, and that a credit bureau told him that Roberts had a low credit score and that his application to refinance his existing mortgage at a lower rate was being denied because account # 9689 was shown as being an open and past due account on his credit report.

b. Arguments

Trans Union moves to strike the affidavit of Joe Rapadas as inadmissible because it is based on the hearsay of unidentified parties, and lacks foundation. Trans Union also objects to Rapadas' conclusion that Roberts' credit denials were based on the open and late status of account # 9689. Trans Union says that this conclusion is opinion testimony and Rapadas has not been identified as an expert. In particular, Trans Union points out that Rapadas fails to specify which lenders he submitted Roberts' application to, which credit bureau he spoke to, and whether any lender relied on a credit report from Trans Union. In his supplemental affidavit, Rapadas explains that he does not name specific lenders, credit bureaus, or which CRA he ordered reports from because he lost Roberts' file.

*9 Roberts argues that Rapadas' affidavit is admissible. Roberts says that the affidavit does not contain expert testimony or hearsay because Rapadas has personal knowledge of the following matters: he worked with Roberts for several months in his attempts to refinance his home; he ran credit reports for Roberts in March 2005 and again in August 2005; he understood both reports to show that the Countrywide account was open and past due; and he was unable to obtain a lender for Roberts.

c. Resolution

Rapadas' affidavit is admissible. Fed. R. Civ. Proc. 56(e) provides that:

supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein.

Rapadas testimony is neither expert testimony or based on hearsay. Rapadas has personal knowledge of facts surrounding Roberts' allegations because he worked directly with Roberts in attempting to refinance his mortgage. Rapadas also has personal knowledge about the lending industry, and reviews credit reports as part of his job as a mortgage broker. Consequently he has knowledge of the effect and meaning of a credit report to a lender.

Although Rapadas states that he has lost Roberts' file, he may testify to his personal knowledge and memory regarding which lenders he worked with on Roberts' behalf, and which CRA he ordered reports from. The Court also notes that the Trans Union credit report issued on August 24, 2005 shows that Financial Indigo Group requested Roberts' credit report on March 1, 2005 and on May 4, 2005, which coincides with the time frame in which Rapadas states that he ordered credit reports.

3. Trans Union's Other Arguments Regarding the Evidence on Damages

Trans Union also argues that Roberts cannot show causation or actual damages because Roberts has failed to establish that it supplied a report to a third party. While Trans Union acknowledges that in his revised counter-statement of disputed facts Roberts has pointed to three creditors who requested credit reports, it says that these are “unknown credit reports containing unknown information.”

Trans Union further says that Roberts' claim that he was denied credit on the basis of the open and late payment status of account # 9698 is false. Trans Union offers a letter dated August 24, 2005 from Rapadas to Roberts stating:

I received a counter offer on to your mortgage application. The Bank that I submitted your application to reduced the appraised value of your home. The appraisal that was done on your home was appraising the house at $115,000 (One Hundred Fifteen Thousand Dollars). After reviewing the appraisal, the Bank did not agree with the Value of the appraisal and reduced the value of your home to $100,000 (One Hundred Thousand Dollars). Therefore, the maximum that they will allow you to borrow is $50,000 (Fifty Thousand Dollars) ... The $50,000 is not enough to payoff your current loan. I will have to withdraw your application with this Bank and try to reapply with another Bank.

*10 Trans Union says that this letter shows that Roberts was approved for a loan after he disputed the status of account # 9698 on May 25, 2005. Moreover, the letter indicates that Roberts inability to refinance his house was due solely to the low appraisal value.

Finally, Trans Union says that Roberts cannot show that the open, late payment status of account # 9689 was a substantial factor in his alleged credit denial because Roberts report had 11 other adverse accounts.

4. Resolution

Roberts' claim of negligent reinvestigation must proceed. Roberts has raised a genuine issue of fact as to causation and damages. First, Roberts has identified three third-party creditors who request and received Trans Union reports.FN10 While Trans Union denies that it distributed the reports, its credit report dated August 24, 2005 plainly states: “The following companies have received your credit report ...”: NCO Group, Michigan Home Finance, and Emigrant Mortgage Company.

FN10. Roberts did not originally identify any lenders who allegedly received Trans Union's credit report. Roberts instead argued that all three nationwide CRAs have a duty to share updates and corrected information found as a result of their reinvestigations. Therefore, Trans Union was liable for damages even if a lender denied Roberts credit based on the inaccurate information reported by another CRA. This argument is meritless, as Roberts bears the burden of showing that a Trans Union credit report was a causal factor in the denial of any of applications for refinancing on his home for a lower interest rate. See Cahlin, 936 F.2d at 1161.

Roberts' has also established through Rapadas' affidavit that he was denied credit and that this was likely based on the inaccurate information on account # 9689. Roberts' also testified in his deposition as to the humiliation and emotional distress he endured because of the inaccurate information on the account.

Next, the fact that Robert's credit reports listed other adverse accounts does not warrant summary judgment in Trans Union's favor. Roberts need not rule out all other explanations for a denial of credit. Philpin, 101 F.3d at 969. Instead, Roberts' burden is to “produce evidence from which a reasonable trier of fact could infer that the inaccurate entry was a ‘substantial factor’ that brought about the denial of credit.” Id. at 968. Robert's points out that Rapadas states in his affidavit that the other adverse entries “were not significant enough to prevent me from obtaining improved financing for Mr. Roberts.” See ¶ 10.

Likewise, although Rapadas did write to Roberts regarding an offer on his mortgage application and a low appraisal, he also wrote in the same letter:

you really need to increase your credit score in order for other Banks to qualify your application. You have talked to the credit bureau regarding different ways you can increase your score and they basically said that the Countrywide mortgage showing up on your credit report is really bringing your score down.

Considering the conflicting evidence on the record, it is for a the finder of fact FN11 to determine to what extent Roberts' other adverse accounts had on his ability to refinance his mortgage; to what extent the inaccurate reporting of Countrywide account # 9689 played in the denial of his application for refinancing his mortgage; and to what extent Robert suffered humiliation and emotional distress.

FN11. Roberts has not requested a jury trial.


For the reasons stated above, Trans Union's motion for summary judgment is GRANTED as to Robert's claim of willful noncompliance and DENIED as to his claim of negligent noncompliance. Further, Trans Union's motion to strike the affidavit of Joe Rapadas is DENIED.