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1681c: Rosenberg v. Calvary

Posted: Sat Jan 14, 2006 6:29 pm
by David A. Szwak
Rosenberg v. Cavalry Investments, LLC
Slip Copy, 2005 WL 2490353
Sep 30, 2005

Defendant also contends that summary judgment should be granted because it merely reported dates to the credit agencies in accordance with the information it was given by Fleet Bank. In opposition, plaintiff argues that the debt was too old to report in the first instance and the defendant should not have provided any information to the credit agencies. "Under 15 U.S.C. § 1681c, consumer reporting agencies are prohibited from reporting adverse credit information which antedates the report by more than seven years." Lendino v. Trans Union Credit Information Co., 970 F.2d 1110, 1111 (2d Cir.1992); 15 U.S.C. § 1681c(a)(4). [FN1]

FN1. The seven-year period referred to in the statute commences "upon the expiration of the 180-day period beginning on the date of the commencement of the delinquency which immediately preceded the collection activity, charge to profit or loss, or similar action." 15 U.S.C. § 1681c(c)(1). Because the underlying dates of delinquency, collection activity and charge off are unclear based on the record, the court is unable to further apply this statutory section.

The parties have presented conflicting evidence as to the age of the debt. The defendant offers a copy of a document that it purportedly received from Fleet Bank which appears to indicate that Fleet charged off the debt on November 18, 1997. See Affidavit of Steven Anderson ("Anderson Aff.") at ¶ 5. The plaintiff offers his affidavit in which avers that he never had any dealings with Fleet. (Rosenberg Aff. at ¶ 3.) The court is unable to determine based on the current record whether the debt was more than seven years old. [FN2] Therefore, a genuine issue of material fact exists regarding whether the defendant violated 15 U.S.C. § 1681c(a)(4) by reporting a debt that was too old.

FN2. There is additional evidence in the record which implies that the debt, to the extent it existed at all, could have been significantly more than seven years old. For example, plaintiff testified at his deposition that approximately ten years before the events in this lawsuit occurred, he received a telephone call from a debt collector purportedly seeking to collect a debt on behalf of Fleet Bank. (See Exhibit A to Affidavit of Sabato Fiano ("Fiano Aff.") at 15.) After plaintiff denied that he owed such a debt, the debt collector informed him that the debt arose out of an account he had with NatWest Bank in the 1970s (and that Fleet had since acquired NatWest). (Id. at 15-21.) In his affidavit, plaintiff indicates that he closed this bank account with NatWest sometime in the 1980s, and that he did not owe any money to NatWest when he stopped banking there. (Rosenberg Aff. at ¶¶ 5, 7.) Further suggestion that the debt was extremely old comes from a document that defendant allegedly received from Fleet when it acquired the debt. That document seems to indicate that the original loan was active as early as August 26, 1976. (Anderson Aff., Ex. 1.)

*5 The defendant next argues that summary judgment should be granted because its investigation of the dispute was adequate and the plaintiff has failed to demonstrate any cognizable damages arising out of his allegation that the defendant violated the Fair Credit Reporting Act ("FCRA"). In response, the plaintiff argues that the defendant violated the FCRA, and therefore CUTPA, [FN3] because it failed to conduct a reasonable investigation after the plaintiff disputed the debt. According to the plaintiff, had the defendant properly investigated its records it would have learned that it could not verify the date of last activity or the opening date (which had been requested by Equifax). This, in turn, "would have averted the unfortunate consequences incurred by plaintiff, since Equifax would have been mandated to delete" the entry from plaintiff's credit report. (Pl's Opp'n to Mtn for SJ (doc. # 54) at 12.)

FN3. The plaintiff asserts in Paragraph 1 of his Complaint that he "seeks relief" pursuant to the FCRA. Although he has not asserted an affirmative cause of action based on the FCRA (Count One asserts a violation of the FDCPA, Count Two asserts a violation of CUTPA), whether the defendant violated the statute--an important statement of public policy--is at least relevant to whether the defendant's actions amount to a
violation of CUTPA. A central element in the analysis under CUTPA is "[w]hether the practice ... offends public policy as it has been established by statutes, the common law, or otherwise--whether, in other words, it is within at least the penumbra of some common law, statutory, or other established concept of unfairness." Associated Investment Co. Limited Partnership v. Williams Associates IV, 230 Conn. 148, 155, 645 A.2d 505 (1994).

The FCRA requires "furnishers" of information to credit reporting agencies, after receiving notice of a consumer dispute from a credit reporting agency, to conduct a reasonable investigation of its records to determine whether the disputed information can be verified. 15 U.S.C. § 1681s-2(b); Johnson v. MBNA Am. Bank NA, 357 F.3d 426, 431 (4th Cir.2004); McMillan v. Experian, 170 F.Supp.2d 278, 283 (D.Conn.2001). Generally, it is a question of fact for the jury as to whether a reasonable investigation was conducted. Akalwadi v. Risk Management Alternatives, Inc., 336 F.Supp.2d 492, 510 (D.Md.2004); Bruce v. First U.S.A. Bank, N.A., 103 F.Supp.2d 1135, 1143 (E.D.Mo.2000) (citing Cushman v. Trans Union Corp., 115 F.3d 220, 225 (3rd Cir.1997); Henson v. CSC Credit Services, 29 F.3d 280, 287 (7th Cir.1994)).
The defendant has not offered any evidence regarding what, if anything, it did to investigate the dispute. Instead, the defendant argues that even if the date of last activity was May 1997 and not November 1997, "that date would have permitted reporting of the relevant account information for seven (7) years thereafter, until May 2004." Defendant's argument misses the point. Whether the defendant's reporting of the debt ultimately was correct--an issue that is not clear based on the current record--the defendant violated the Fair Credit Reporting Act if it failed to conduct a reasonable investigation in accordance with 15 U.S.C. § 1681s-2(b). Defendant has failed to sustain its burden of proving that it is entitled to summary judgment on this issue.
There are genuine issues of material fact regarding the plaintiff's claims under the FDCPA and the FCRA. These disputed issues of fact preclude summary judgment on the plaintiff's CUTPA claim which, as the defendant correctly notes, is based on those same alleged violations of the FDCPA and FCRA. (Def's Mem. of Law in Supp. of Mtn for SJ (doc. # 38) at 19.) For these reasons, the court recommends that defendant's motion for summary judgment be denied.