[Administrator]

Gelman v. State Farm Mut. Auto. Ins. Co. , No. 07-3665
In plaintiff's putative class action against State Farm under the Fair Credit Reporting Act (FRCA) arising from an allegedly improper disclosure of plaintiff's credit report and a subsequent mailer from the insurance company that arose from that disclosure, dismissal of the claims is affirmed as plaintiff failed to state a claim for his false pretenses and permissible purpose claims because State Farm's mailer constituted an offer of insurance under the FCRA, and that was a permissible purpose for disclosing plaintiff's credit report.
_________________
David Szwak
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 318-221-6555

[Administrator]

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 07-3665
BRUCE GELMAN, ESQUIRE,
ON BEHALF OF HIMSELF
AND ALL OTHERS
SIMILARLY SITUATED
v.
STATE FARM MUTUAL
AUTOMOBILE INSURANCE
COMPANY
Bruce Gelman,
Appellant
Appeal from the United States District Court
for the Eastern District of Pennsylvania
(Civ. No. 06-cv-05118)
District Judge: Hon. William H. Yohn
2
Argued: September 9, 2008
Before: SCIRICA, Chief Circuit Judge, McKEE
and SMITH, Circuit Judges
(Opinion filed: October 5, 2009)
PATRICK J. LOUGHREN, ESQ. (Argued)
Loughren, Loughren & Loughren, P.C.
3204 Grant Building
Pittsburgh, PA 15219
DANIEL C. LEVIN, ESQ.
Levin, Fishbein, Sedran & Berman
510 Walnut Street, Suite 500
Philadelphia, PA 19106
CHRISTOPHER G. HAYES, ESQ.
The Law Office of Christopher G. Hayes
225 South Church Street
West Chester, PA 19382
Attorneys for Appellant
JAMES T. MOUGHAN, ESQ.
Britt, Hankins & Moughan
Suite 515
Two Penn Center Plaza
1500 John F. Kennedy Boulevard
Philadelphia, PA 19102
3
MICHAEL P. KENNY, ESQ.
CARI K. DAWSON, ESQ. (Argued)
DERIN B. DICKERSON, ESQ.
Alston & Bird LLP
1201 W. Peachtree Street
Atlanta, GA 30309
Attorneys for Appellee
THOMAS W. CURVIN, ESQ.
VALERIE S. SANDERS, ESQ.
DREW D. DROPKIN, ESQ.
Sutherland Asbill & Brennan LLP
999 Peachtree Street, N.E.
Atlanta, GA 30309
Attorneys for Amicus Curiae, Property
Casualty Insurers Association of
America, in support of Appellees
OPINION
McKEE, Circuit Judge.
Bruce Gelman appeals the district court’s Rule 12(b)(6)
dismissal of the claims he filed under the Fair Credit Reporting
Act that arose from an allegedly improper disclosure of his
credit report and a subsequent mailer from an insurance
company that arose from that disclosure. For the reasons that
follow, we will affirm the district court.
1The facts are as alleged in Gelman’s complaint. See
Evancho v. Fisher, 423 F.3d 347, 350 (3d Cir. 2005). (When
reviewing a dismissal for failure to state a claim under Fed. R.
Civ. P. 12(b)(6), we assume the truth of the plaintiff’s
allegations.)
2 A copy of the mailer he received from State Farm
was attached to his complaint as an exhibit. The exhibit is an
undated sample mailer, and Gelman does not allege when he
received it.
4
I. FACTUAL BACKGROUND1
On or about November 18, 2004, State Farm Mutual
Automobile Insurance Company requested and obtained
Gelman’s consumer credit report from Experian, a consumer
reporting agency, without Gelman’s consent or authorization.
Gelman alleges that he did not discover that State Farm had
obtained his consumer credit report until April 5, 2006, when he
received a copy of his consumer credit report from Experian.
His consumer credit report noted that State Farm had obtained
his credit report for a “permissible purpose.” Gelman sued State
Farm after the latter obtained a copy of his credit report from a
credit reporting agency and used it to select Gelman to receive
materials pertaining to insurance products that he might qualify
for and/or be interested in.
The mailer that was sent claims that State Farm has been
the “No. 1 auto insurer since 1942.”2 In a paragraph set off by
a border, the mailer says it is a “prescreened offer.” It also states
in bold, enlarged font: “Call . . . for a quote or return the
5
attached card today. I could save you up to $356!*.” The
mailer also claims: “[a]s your agent, I’ll help you find the right
level of coverage at the right price for your needs. By getting
to know you personally, I can offer: Competitive rates that can
save you up to $356 or more.*” A footnote to the asterisk states:
“Actual average annual savings were $356.58 per household.
This amount is based on a January 2005 survey of new
policyholders who reported savings through State Farm as
compared to their previous carriers’ rates.”
An attached card further describes the auto insurance
“offering.” Its caption reads: “Learn more about auto insurance
at statefarm.com.” The line underneath the caption and next to
a checkmarked box reads: “Yes! I’d like more insurance
information on State Farm auto insurance.” The attached card
asks for the recipient’s phone number, best time to call, name of
current car insurance carrier and renewal date of car insurance.
That card also gives the recipient the opportunity to request
more information regarding homeowners insurance, flexible
payment options, life insurance or “other.”
In addition, the mailer contains the following opt-out
notice in a paragraph set off by a border: “You can choose to
stop receiving ‘prescreened’ offers of insurance from this and
other companies by calling toll-free . . .. See ‘PRESCREEN &
OPT-OUT NOTICE’ on the other side for more information
about prescreened offers.” The other side of the mailer that is
referenced contains the following information:
PRESCREEN & OPT-OUT NOTICE: This
“prescreened” offer of insurance is based on the
6
information in your consumer reports, including
your credit report, indicating that you meet
certain eligibility criteria. This offer is not
guaranteed if you do not meet our criteria at the
time of application and expires 60 days after you
receive it. If you wish to omit your name from
future State Farm mailings, please contact me at:
State Farm Customer Mail Response Center at:
State Farm Insurance Company-Customer Mail
Response Center – P.O. Box 1800 – Aurora, ILL
60507-9863. If you do not want to receive
prescreened offers of insurance from this and
other companies, contact the consumer reporting
agencies listed below or call toll-free . . . .
Gelman contends that State Farm’s mailer is an invitation
to call State Farm to find out about the various insurance
products that State Farm might attempt to sell. Put another way,
Gelman contends that the State Farm mailing is nothing more
than promotional material soliciting him to contact State Farm
regarding its various insurance products and that it is therefore
not the kind of firm offer of insurance that would legitimize
State Farm’s access to his credit report under federal law.
II. DISTRICT COURT PROCEEDINGS
On November 22, 2006, Gelman filed a putative class
action complaint against State Farm asserting four substantive
and two procedural claims arising under the Fair Credit
Reporting Act (“FCRA”), 15 U.S.C. § 1681 et seq.
Specifically, Gelman asserted that: (1) State Farm obtained his
3 Gelman is only challenging the district court’s
holding that State Farm’s mailer was an offer of insurance
and that the disclosure of his credit report was therefore
permissible under the FCRA. That holding resulted in the
7
credit report from a credit reporting agency under false
pretenses in knowing and willful violation of § 1681q (“false
pretenses claim”); (2) State Farm willfully violated § 1681b(f)
without a permissible purpose (“permissible purpose claim”);
(3) State Farm’s offer of insurance did not contain the “clear
and conspicuous” disclosures required by § 1681m (“the
disclosure claim”); and (4) State Farm negligently violated each
of the foregoing statutory provisions in violation of § 1681o.
Gelman also sought declaratory and injunctive relief.
State Farm responded by filing a motion to dismiss for
failure to state a cause of action pursuant to Fed.R.Civ.P.
12(b)(6), and the district court granted that motion as to all of
Gelman’s claims. Gelman v. State Farm Mut. Auto. Ins. Co.,
2007 WL 2306578 (E.D. Pa. Aug. 9, 2007). The district court
held that Gelman failed to state a claim for his false pretenses
and permissible purpose claims because State Farm’s mailer
constituted an offer of insurance under the FCRA, and that was
a “permissible purpose” for disclosing Gelman’s credit report.
Id. at *4-8. It further held that the FCRA does not provide for
a private right of action to recover for disclosures that are
contrary to provisions of the FCRA. Id. at *8. The district
court also held that the FCRA does not provide private litigants
declaratory and injunctive relief. Id. at *9. This appeal
followed.3
dismissal of each of Gelman’s claims under the FCRA.
4Iqbal was decided by the Supreme Court after this
case was argued. However, “appellate courts are obliged to
apply the law as they find it at the time of their judgment.” C
& K Coal Co. v. United Mine Workers of America, 704 F.2d
690, 698 (3d Cir. 1983).
8
III. STANDARD OF REVIEW
We exercise plenary review of the district court’s order
granting a motion to dismiss for failure to state a claim.
Santiago v. GMAC Mortgage Corp., 417 F.3d 384, 386 (3d Cir.
2005). In determining whether a district court’s dismissal of a
complaint under Fed.R.Civ.P. 12(b)(6) was proper, we must
“accept all factual allegations as true, construe the complaint in
the light most favorable to the plaintiff, and determine, whether
under any reasonable reading of the complaint, the plaintiff may
be entitled to relief.” Phillips v. County of Allegheny, 515 F.3d
224, 233 (3d Cir. 2008). At this stage, “a complaint must
contain sufficient factual matter, accepted as true, to ‘state a
claim to relief that is plausible on its face.’ 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, U.S.
, 129 S.Ct. 1937, 1949 (2009)4 (quoting Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 556 (2007)). “[W]here the wellpleaded
facts do not permit the court to infer more than the mere
possibility of misconduct, the complaint has alleged – but it has
not ‘show[n]’ – that the ‘pleader is entitled to relief.’” Iqbal,
5 For reasons that will become apparent in our
discussion of Cole, that case is readily distinguishable from
the situation here, and it has since been limited to
circumstances not before us. Nevertheless, that decision
remains one of the few appellate decisions interpreting
provisions of the FCRA applicable here, and its interpretation
of terms used in the FCRA remains helpful.
9
129 S.Ct. at 1950 (quoting Fed.R.Civ.P. 8(a)(2)).
In addition, because Gelman attached a copy of State
Farm’s mailer to his complaint, the mailer may be considered
for purposes of ruling upon the Rule 12(b)(6) motion. See
Pension Benefit Guar. Corp. v. White Consl. Indus., Inc., 998
F.2d 1192, 1196 (3d Cir. 1993).
IV. LEGAL BACKGROUND
“Congress enacted the FCRA in 1970 to ensure fair and
accurate credit reporting, promote efficiency in the banking
system, and protect consumer privacy.” Safeco Ins. Co. of
America v. Burr, 551 U.S. 47, 127 S.Ct. 2201, 2205 (2007). In
doing so, Congress sought to preserve the consumer’s privacy
in the information maintained by consumer reporting agencies.
Cole v. U.S. Capital, Inc., 389 F.3d 719, 725 (7th Cir. 2004).5
A “consumer reporting agency” is defined as: “any person
which, for monetary fees, dues, or a cooperative nonprofit basis,
regularly engages in whole or in part in the practice of
assembling or evaluating consumer credit information or other
information on consumers for the purpose of furnishing
6A “consumer credit report” is “any written, oral, or
other communication of any information by a consumer
reporting agency bearing on a consumer’s credit worthiness,
credit standing, credit capacity, character, general reputation,
personal characteristics, or mode of living which is used or
expected to be used or collected in whole or in part for the
purpose of serving as a factor in establishing the consumer’s
eligibility for – (A) credit or insurance to be used primarily
for personal, family or household purposes; (B) employment
purposes; or (C) any other purpose authorized under section
1681b of this title.” 15 U.S.C. § 1681a(d)(1).
10
consumer reports to third parties, and which uses any means or
facility of interstate commerce for the purpose of preparing or
furnishing consumer reports.” 15 U.S.C. § 1681a(f).
The Act explains: “There is a need to insure that
consumer reporting agencies exercise their grave responsibilities
with fairness, impartiality, and a respect for the consumer.” 15
U.S.C. § 1681(a)(4). Accordingly, Congress prohibited credit
agencies from releasing consumer credit reports 6 “unless the
release occurs for one of the permissible purposes set forth in 15
U.S.C. § 1681b(a).” Cole, 389 F.3d at 725. Section 1681
provides for release of consumer credit reports “‘[s]ubject to
subsection (c) of [that] section,’” under certain narrowly defined
circumstances “and no other . . .’” Cole, 389 F.3d at 725.
However, in enacting § 1681, Congress realized that
disclosures of consumer credit reports are often the direct result
of inquiries initiated by consumers themselves. Congress
7 Inasmuch as State Farm’s mailing did not involve an
offer of credit, or a solicitation for a loan, we limit our
discussion to the exemption for firm offers of insurance
contained in § 1681b.
11
allowed for disclosure in many such situations because they “do
not create significant privacy concerns.” Cole, 389 F.3d at 725.
“For example, when the consumer applies for credit,
employment, insurance or a license, the consumer reporting
agency may release the consumer’s report.” Id. at 726, n.5
(citing 15 U.S.C. § 1681b(a)(3)(A)-(F)). That section also
provides for: “limited situations in which a consumer credit
agency may furnish a consumer report even though the
consumer has not initiated or authorized the release.” Id. at 725.
One such situation occurs when a credit or insurance provider
is extending the consumer a “firm offer of credit or insurance.”
15 U.S.C. § 1681b(c)(1)(B)(i). As we stated earlier, Gelman is
alleging that State Farm failed to make a firm offer of
“insurance,” and the disclosure was therefore not within the
narrow exemption in the FCRA allowing disclosure of
consumer credit reports for firm offers of insurance.7
The FCRA defines a “firm offer of . . . insurance” as:
any offer of . . . insurance to a consumer that will
be honored if the consumer is determined, based
on information in a consumer report, to meet the
specific criteria used to select the consumer for
the offer. . . .
15 U.S.C. § 1681a(l). However, Congress allowed a “firm
8 “Willful” violations include reckless disregard of any
requirement of the FCRA. See Safeco Ins. Co. of America v.
Burr, supra.
12
offer” to be conditioned on three specific requirements, the
existence of which do not preclude an offer of insurance from
being “firm.” First, the consumer may need to satisfy
additional pre-selected criteria bearing on the consumer’s
creditworthiness. 15 U.S.C. § 1681a(l)(1). Second, the offer
may be conditioned on verification “that the consumer
continues to meet the specific criteria used to select the
consumer for the offer.” 15 U.S.C. § 1681a(l)(2). Third, the
offer may be conditioned on the consumer’s furnishing any
collateral that was both established before the selection of the
consumer for the offer and disclosed to the consumer in the
offer. 15 U.S.C. § 1681a(l)(3).
Congress gave the Federal Trade Commission (“FTC”)
primary responsibility for governmental enforcement of the
FCRA. 15 U.S.C. § 1681s. However, the FCRA also creates a
private cause of action. See 15 U.S.C. §§ 1681n-o. Sections
1681n and 1681o establish civil liability for willful and
negligent noncompliance with § 1681. It allows recovery of
actual damages, 15 U.S.C. § 1618o, as well as statutory and
punitive damages if a violation is “willful.” 15 U.S.C. § 1681n.8
V. DISCUSSION
As noted, the district court held, inter alia, that Gelman
failed to state a claim for his false pretenses claim, 15 U.S.C. §
9 15 U.S.C. § 1681q, provides: “Any person who
knowingly and willfully obtains information on a consumer
from a consumer reporting agency under false pretenses shall
be fined under Title 18, imprisoned for not more than 2 years,
or both.”
10 15 U.S.C. § 1681b(f) provides: “A person shall not
use or obtain a consumer report for any purpose unless – (1)
the consumer report is obtained for a purpose for which the
consumer report is authorized to be furnished under this
section; and (2) the purpose is certified in accordance with
section 1681e of this title by a prospective user of the report
through a general or specific certification.”
13
1681q,9 and his permissible purpose claim, 15 U.S.C. §
1681b(f),10 because State Farm did send him a firm offer of
insurance as defined by the FCRA. In so holding, the district
court rejected Gelman’s contention that a firm offer of insurance
must have “value” to the consumer. In Gelman’s view, an offer
of insurance without value is nothing more than an
advertisement or a solicitation of business, which is not a
permissible purpose for seeking a consumer’s credit report
under the FCRA.
Gelman rests his argument that a firm offer of insurance
must have value exclusively on the decision of the Court of
Appeals for the Seventh Circuit in Cole v. U.S. Capital, Inc.,
389 F.3d 719 (7th Cir. 2004). He argues: “The statutory
scheme of the FCRA makes clear that a ‘firm offer’ must have
sufficient value for the consumer to justify the absence of the .
. . protection of his privacy.’” Appellant’s Br. at 7 (quoting
14
Cole, 389 F.3d at 376). Gelman’s claim on appeal can be
reduced to his contention that: “the District Court found that
when determining a firm offer, you are not required to evaluate
whether the offer has any value and thereby rejects the Seventh
Circuit approach in Cole,” Appellant’s Br. at 10.
In Cole, an unsolicited mailing to Cole from U.S. Capital
and Gleason Chevrolet offered a $300 credit that could only be
used to purchase a car at Gleason Chevrolet. The mailing said
approval was neither expressed nor implied and that interest
rates might vary from 3% to 24.9%, with no indication of how
interest would be compounded and with no indication of a
repayment schedule. Cole sued U.S. Capital alleging, inter
alia, an improper use of her credit report because the mailing
was not a firm offer of credit. Rather, she claimed it was
“merely a sham to justify obtaining her credit report.” Id. at
726. She contended “that, given the insignificant amount of
credit, the offer was not made with the expectation that a
significant number of consumers would accept the offer, and,
therefore, it cannot constitute a ‘firm offer of credit’ for
purposes” of FCRA. Id.
U.S. Capital responded by arguing that the “lynchpin of
‘firm offer of credit’ is that some amount of credit – however
small – is guaranteed.” Id. In U.S. Capital’s view, “the FCRA
does not require a minimum amount of credit to be offered and
therefore the preapproval could be for any amount, perhaps
even as low as $1.” Id. (citation omitted).
In rejecting U.S. Capital’s argument, the court wrote:
We believe that the reading of “firm offer of
15
credit” suggested by [U.S. Capital] . . . eviscerates
the explicit statutory purpose of protecting
consumer data and privacy. Indeed, such a
definition would permit anyone to gain access to
a sea of sensitive consumer information simply by
offering some nominal amount of guaranteed
credit. The statutory scheme of the FCRA makes
clear that a “firm offer” must have sufficient
value for the consumer to justify the absence of
the statutory protection of his privacy. A
definition of “firm offer of credit” that does not
incorporate the concept of value to the consumer
upsets the balance Congress carefully struck
between a consumer’s interest in privacy and the
benefit of a firm offer of credit for all those
chosen through the pre-screening process. From
the consumer’s perspective, an offer of credit
without value is the equivalent of an
advertisement or solicitation. It is clear that
Congress did not intend to allow access to
consumer credit information for catalogs and
sales pitches. Such importuning simply – and
understandably – is not among the permissible
reasons for which a credit agency may disclose a
consumer’s credit information.
Id. at 726-27 (citations omitted). The court also believed that
focusing on whether the offer would have been honored was
“inappropriately narrow.” Id. at 727. It wrote:
To determine whether the offer of credit comports
11“The term ‘firm offer of credit or insurance’ means
any offer of credit or insurance to a consumer that will be
honored . . . .” 15 U.S.C. § 1681a(l).
16
with the statutory definition, a court must
consider the entire offer and the effect of all the
material conditions that comprise the credit
product in question. If, after examining the entire
context, the court determines that the “offer” was
a guise for solicitation rather than a legitimate
credit product, the communication cannot be
considered a firm offer of credit.
Id. at 727-28 (emphasis in original).11 Relying on Cole, Gelman
submits that State Farm’s mailer does not have any value to him
and, therefore, is not a firm offer of insurance. The argument
lacks merit for a number of reasons.
First, Gelman never explains what “value” the mailer
should have provided him. Second, irrespective of what
Gelman means by “value,” our inquiry must focus on the text of
the statute itself. As the Supreme Court has commented:
We have stated time and again that courts must
presume that a legislature says in a statute what it
means and means in a statute what it says there.
When the words of a statute are unambiguous,
then, this first canon is also the last: “judicial
inquiry is complete.”
17
Barnhart v. Sigmon Coal Co., 534 U.S. 438, 461-62 (2002).
As noted above, the FCRA provides that a “firm offer of . . .
insurance” means:
any offer of . . . insurance to a consumer that will
be honored if the consumer is determined, based
on information in a consumer report, to meet the
specific criteria used to select the consumer for
the offer. . . .
15 U.S.C. § 1681a(l). The text of § 1681a(l) is unambiguous,
and it does not mention “value,” or anything akin to it.
Moreover, in referring to “any offer of . . . insurance,” Congress
clearly did not intend to limit the scope of § 1681a(l), to only
those having “value.” We therefore can not accept Gelman’s
argument without effectuating a judicial amendment of the
statute.
Third, even assuming arguendo that Congress intended
to limit a firm offer to one that has value pursuant to the
analysis in Cole, Gelman’s argument would still be undermined
by subsequent decisions limiting the reach of Cole to
circumstances that do not exist here. In Murray v. GMAC
Mortgage Corp., 434 F.3d 948 (7th Cir. 2006), the court
explained:
We held in Cole that a sham offer used to pitch a
product rather than extend credit does not meet
the statutory definition. A business that obtains
consumer credit information and then offers a $1
loan (at 100% daily interest) toward the purchase
18
of a car has not made a “firm offer of credit” but
has instead used credit histories to identify
potential auto buyers. That objective is not
allowed under the [FCRA] we concluded in Cole.
Id. at 955 (emphasis in original). It further noted:
Cole’s objective was to separate bona fide offers
of credit from advertisements for products and
services, determining from “all the material
conditions that comprise the credit product in
question . . . [whether it] was a guise for
solicitation rather than a legitimate credit
product.”
Id. at 955-56 (citing Cole, 389 F.3d at 728) (emphasis in Cole).
Thereafter, in Murray v. New Cingular Wireless Services,
Inc., 523 F.3d 719 (7th Cir. 2008), the court limited Cole’s
“value” requirement even further. It wrote:
§ 1681b(c)(1)(B)(i) calls for a firm offer of credit
but not a valuable firm offer of credit. A firm
offer of credit suffices. Cole did not doubt this.
The problem in Cole was how to disentangle an
offer of merchandise from an offer of credit when
they are made jointly (in Cole, the merchant was
selling cars and offered to extend credit for a
small fraction of the price). We asked whether
the offer of credit would be valuable standing
alone in order to see whether the non-consensual
19
check of a person’s credit history had been used
to make an offer of merchandise, something the
statute does not allow. . . . When credit histories
are used to offer credit (or insurance) and nothing
but, the right question is whether the offer is
“firm” rather than whether it is “valuable.”
Id. at 722 (emphasis in original).
Gelman’s situation is completely unlike the car loan
involved in Cole. Thus, Cole offers no support for his
insistence on a value requirement, and his position is further
undermined by the text of the FCRA.
In addition to advocating a value requirement, Gelman
contends that because the term “firm offer” is not defined in the
FCRA, the district court was required to determine the meaning
of “firm offer.” That argument ignores the very statute it
purportedly rests upon because the FCRA specifically defines
the term “firm offer.” As noted earlier, the FCRA contains the
following definition: a “firm offer of . . . insurance” is “any
offer of . . . insurance to a consumer that will be honored if the
consumer is determined, based on information in a consumer
report, to meet the specific criteria used to select the consumer
for the offer.” 15 U.S.C. § 1681a(l). Thus, as the court noted
in Murray v. New Cingular Wireless Services, Inc., 523 F.3d at
723 “‘firm offer’ is a defined phrase.” A “firm offer” is one that
will be “honored” (if the verification checks out). . . .” Id.; see
also Kennedy v. Chase Manhattan Bank USA, NA, 369 F.3d
833, 841 (5th Cir. 2004) (holding that a firm offer under the
FCRA “really means a ‘firm offer’ if you meet certain criteria”).
20
Although it contained substantial puffery and statements
that could only have been intended as promotional, State Farm’s
letter to Gelman met the FCRA’s statutory definition of a “firm
offer.” It stated: “[t]his ‘presecreened’ offer of insurance is
based on information in your consumer report indicating that
you meet certain eligibility criteria. This offer is not guaranteed
if you do not meet our criteria at the time of application and
expires 60 days after you receive it.” The mailer also read: “[a]s
your agent, I’ll help you find the right level of coverage at the
right price for your needs. By getting to know you personally,
I can offer: Competitive rates that help you save up to $356 or
more.” The mailer thus stated that the offer of insurance
contained therein would be honored if Gelman met certain
criteria. Gelman did not allege that he responded to State
Farm’s mailing and was denied insurance even though he
satisfied the pre-screening criteria. That would present a very
different scenario that we need not now consider.
Finally, Gelman contends that the district court ignored
the allegations in his complaint. Gelman submits that he alleged
that the mailing was part of a marketing campaign. However,
he contends that the district court mischaracterized his
complaint and accepted State Farm’s argument that its intent in
sending the mailing was to extend a firm offer of insurance. He
claims that the district court’s acceptance of State Farm’s
argument is evident from its opinion. In buttressing that
argument, he points to the following discussion in what he
contends is footnote 3 of the district court’s opinion:
Even if the attachment does not satisfy the
21
requirements for a firm offer of insurance,
Plaintiff’s claim still must fail. A party is not
liable for obtaining consumer information
pursuant to § 1681b as long as it intends to use
the information for a permissible purpose.
Plaintiff has not alleged that State Farm did not
intend to use his credit report for a permissible
purpose. In fact, Plaintiff implicitly concedes that
his consumer report was obtained for a
permissible purpose. (See Complaint at ¶ 12 (“the
[consumer] report expressly stated that State
Farm had reviewed [Plaintiff’s] information for a
‘permissible purpose by law”)).
However, that quote is from a footnote in State Farm’s motion
to dismiss. It is not from the district court’s opinion as Gelman
mistakenly claims.
VI. CONCLUSION
For all of the above reasons, we will affirm the district
court’s dismissal of Gelman’s complaint pursuant to
Fed.R.Civ.P. 12(b)(6).
_________________
David Szwak
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 318-221-6555