# FIGUEROA v. EXPERIAN INFORMATION SOLUTIONS, INC

> District Court, D. New Jersey · January 19, 2024

URL: https://www.frixlaw.com/law-library/cases/10278094

## Case

- **Court:** District Court, D. New Jersey
- **Decided:** January 19, 2024
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

YESSENIA FIGUEROA,
Plaintiff,
Civ, No, 2:23-cv-482 (WJM)
v.
CAPITAL ONE, N.A., OPINION
Defendant.

WILLIAM J. MARTINI, U.S.D.U.
Before the Court is an action by Plaintiff Yessenia Figueroa against Defendant
Capital One, N.A. (‘Capital One”) alleging violations of the Fair Credit Reporting Act
(“FCRA”), 15 U.S.C. § 1681, ef seg. After Defendant moved to dismiss Plaintiff's
complaint pursuant to Federal Rule of Civil Procedure 12(b)\(6), ECF No. 15, the parties
were ordered to submit briefing regarding whether Plaintiff has Article III standing to bring
her claims in this Court. ECF No. 23. After careful consideration of the parties’
submissions, the Court holds that Plaintiff has sufficiently demonstrated Article □□
standing but has failed to state a claim under Rule 12(b)(6). For the reasons set forth below,
Capital One’s motion to dismiss, ECF No. 15, is GRANTED.
I. BACKGROUND
Plaintiff Yessenia Figueroa obtained a credit disclosure from Experian Information
Solutions, Inc. (“Experian”) on November 5, 2022. Compl. { 10, ECF No. 1. The tradelines
reported on the disclosure included monthly payment amounts of $49.00, $72.00, and
$73.00 from Capital One accounts. Compl]. | 7. However, these accounts were previously
closed by Capital One. Compl. ¢ 8. Plaintiff alleges that because the accounts have been
closed, the entire balance is due presently and that she has neither the right nor the
obligation to satisfy these debts in monthly installments. Compl. 9 8. On or about
November 28, 2022, Plaintiff submitted a letter to Experian disputing the three Capital One
tradelines. Compl. J 11. In her dispute letter, Plaintiff explained that the account reflected
by these tradelines were closed. Compl. 12. She stated that because the accounts were
closed, she no longer had an obligation to make monthly payments to Capital One. Compl.
| 12. She asked Experian to report the tradelines with a scheduled monthly payment of
$0.00, Compl. § 12. Experian forwarded Plaintiffs customer dispute to Capital One.
Compl. § 13. On January 24, 2023, Plaintiff obtained another Experian credit disclosure,

which showed that Experian and Capital One failed or refused to report the scheduled
monthly payment amount as $0,00. Compl. ¥ 14.
Plaintiff brought this action three days later alleging violations of the FCRA.! See
generally Compl. Plaintiff alleges that Capital One negligently and willfully violated the
FCRA by failing to properly investigate Plaintiff's dispute as required under 15 U.S.C. §
1681s-2(b) and failing to direct Experian to report its tradelines with a scheduled monthly
payment amount of $0.00. Compl. JJ 21-32. Specifically, Plaintiff argues that “[p]er credit
reporting industry standards and the Credit Reporting Resource Guide, which is the credit
reporting manual created by the Consumer Data Industry Association, furnishers are not to
report a monthly payment on a closed account.” Compl. 9. As a result, Plaintiff argues
that the tradelines listed in her Experian credit disclosures are inaccurate and create a
misleading impression of her consumer credit file. Compl. § 24. She asserts that the
tradelines “create a false impression to potential credit grantors that [she] continues to have
a monthly obligation on a debt, when in fact there is no such monthly obligation.” Compl.
4] 15. Notably, however, Plaintiff does not assert in her complaint that her credit reports
have actually been published to any potential credit grantor.
Il, PROCEDURAL HISTORY
Plaintiff filed the present action on January 27, 2023. ECF No. 1. Capital One moved
to dismiss the complaint on March 14, 2023. ECF No. 15. Plaintiff filed a late opposition
brief on April 18, 2023. ECF No. 17. Capital One filed a reply brief on May 3, 2023. ECF
No. 20, On August 22, 2023, this Court denied Capital One’s motion without prejudice and
issued a sua sponte order directing the parties to submit supplemental briefing regarding
whether Plaintiff has Article III standing to bring her claims in light of the U.S. Supreme
Court’s decision in TransUnion LLC y, Ramirez, 594 U.S. 413 (2021), Plaintiff timely filed
her brief on September 1, 2023. Pl.’s Supp. Br., ECF No. 24. Capital One did not file a
response.
I. LEGAL STANDARD
Article II of the Constitution limits the jurisdiction of federal courts to “Cases” and
“Controversies.” U.S. Const. art. II, § 2. One element of this case-or-controversy
requirement is that Plaintiff, as the party invoking federal court jurisdiction, must establish
that she has standing to sue. See Raines v. Byrd, 521 U.S. 811, 818 (1997) (citing Lujan v.
Defenders of Wildlife, 504 U.S, 555, 561 (1992)}). To satisfy Article III’s standing
requirements, Plaintiff must “clearly .. . allege facts demonstrating” all three elements of
constitutional standing: (1) an “injury in fact,” (2) that is “fairly traceable” to Defendants’
challenged conduct, and (3) “that is likely to be redressed by a favorable judicial decision.”
Spokeo, Inc. v. Robins, 378 U.S. 330, 338 (2016) (citations omitted), “To establish injury
' The parties stipulated to the dismissal of Experian from the case with prejudice. ECF No. 22.

in fact, a plaintiff must show that he or she suffered ‘an invasion of a legally protected
interest’ that is ‘concrete and particularized’ and ‘actual or imminent, not conjectural or
hypothetical.’” Jd. at 339 (quoting Lujan, 504 U.S. at 560). Concrete injuries can be
tangible or intangible, See TransUnion LLC v. Ramirez, 594 U.S, 413, 425 (2021), “Absent
Article II standing, a federal court does not have subject matter jurisdiction to address a
plaintiffs claims, and they must be dismissed.” 7aliaferro v. Darby Twp. Zoning Bd., 458
F.3d 181, 188 (3d Cir. 2006). The Court presumes that it “lack[s| jurisdiction unless the
contrary appears affirmatively from the record.” I7 re Johnson & Johnson Talcum Powder
Prod. Mktg., Sales Pracs. & Liab, Litig., 903 F.3d 278, 288 (3d Cir. 2018) (citations and
quotation marks omitted).
IV. DISCUSSION
A. Plaintiff Sufficiently Alleges Article II] Standing
At issue here is the first element of constitutional standing: injury in fact. The
Supreme Court “has rejected the proposition that ‘a plaintiff automatically satisfies the
injury-in-fact requirement whenever a statute grants a person a statutory right and purports
to authorize that person to sue to vindicate that right.’” TransUnion, 594 U.S. at 426
(quoting Spokeo, 578 U.S. at 341). “[U]nder Article III, an injury in law is not an injury in
fact, Only those plaintiffs who have been concretely harmed by a defendant’s statutory
violation may sue that private defendant over that violation in federal court.” Jd. at 427.
“Central to assessing concreteness is whether the asserted harm has a ‘close relationship’
to a harm traditionally recognized as providing a basis for a lawsuit in American courts—
such as physical harm, monetary harm, or various intangible harms including .. .
reputational harm.” Jd. at 417 (quoting Spokeo, 578 U.S. at 340-41).
Based on these principles, Plaintiff asserts in part that she suffered an injury in fact
because Capital One’s “false and misleading reporting to a credit bureau about Plaintiff's
obligation on a debt has a close relation[]ship to reputational harms such as defamation and
common law fraud.” PI.’s Supp. Br. 4.2 The U.S. Supreme Court extensively analyzed the
reputational harm caused by defamation for standing purposes in its recent TransUnion
decision. There, the Court decided whether class members, who were each erroneously
labeled as potential terrorists in their respective credit reports, had Article II{ standing to
bring their FCRA claims against TransUnion, the credit reporting agency that issued the
reports. In order to determine whether the individuals suffered a harm related to the tort of
defamation, the Court noted that “[u]nder longstanding American law, a person is injured

? Plaintiff also asserts that as a result of Capital One’s “failure to correct the false and misleading information on her
credit report, she suffered credit and emotional damages of stress, anxiety, frustration, resulting in crying spells, loss
of sleep and weight gain.” Pl.’s Supp. Br, 4. She also alleges that Capital One’s “actions or omissions caused
Plaintiff to lose time attempting to correct the false information on her credit report.” Jd. Because the Court finds
that Plaintiff has suffered harm analogous to defamation, there is no need to address Plaintiffs other allegations of
harm.

when a defamatory statement ‘that would subject him to hatred, contempt, or ridicule’ is
published to a third party.” 594 U.S, at 432 (citations omitted); see also Restatement (First)
of Torts § 559 (1938). Relying on this definition, the Court determined that the class
members whose misleading credit reports were disseminated to third-party businesses
“suffered a harm with a ‘close relationship’ to the harm associated with the tort of
defamationj,]” and as such, “suffered a concrete harm that qualifies as an injury in fact.”
594 U.S, at 432. By contrast, however, the class members whose misleading credit reports
were not disseminated to a third party “did suffer a concrete harm[,]” and thus did not
have Article III standing to bring their claims. Jd. at 439, 442 (emphasis added).
Analogizing to the subgroup found to have standing in TransUnion, Plaintiff
specifically asserts that she suffered a concrete harm when Capital One erroneously
reported to Experian, a credit reporting agency, that she owed monthly payment obligations
to Capital One. Pl.’s Supp. Br. 5. Lower courts have split on the issue of whether
dissemination of a defamatory statement to a credit reporting agency, as opposed to the
potential creditors at issue in TransUnion, creates a concrete harm. In Campbell v. Portfolio
Recovery Associates LLC, the district court held that because the distribution of inaccurate
information to a credit reporting agency was “[u[nlike the disclosures at issue in
TransUnion,” it did not constitute a concrete injury for standing purposes. 21CV1322, 2022
WL 657225, at *2 (E.D.N.Y. Mar. 4, 2022). Similarly, in Spira v. TransUnion LLC, the
district court noted that “not all ‘third-parties’ are created equal” and held that “credit
reporting agencies ... are not the type of third parties contemplated by the Supreme Court
in TransUnion{.]” No. 21-CV-2367, 2022 WL 2819469, at *4-5 (S.D.N.Y. July 19, 2022),
However, the TransUnion Court did not specify that third-party publication under
the FCRA was limited only to potential creditors. Instead, looking to generally accepted
principles of tort law, the third party to whom the defamatory information is disseminated
must only “understand its defamatory significance.” Restatement (Second) of Torts § 577
emt. ¢ (1977). The Court of Appeals for the Seventh Circuit relied on this principle in
Ewing v. MED-I Sols, LLC, 24 F.4th 1146 (7th Cir. 2022). There, at issue was whether
two plaintiff consumers suffered concrete injuries after debt collectors reported their
respective debts to credit reporting agencies without indicating that the debts were disputed
by the consumers. /d at 1149-50, 1152. The Ewimg Court found that the plaintiffs
sufficiently demonstrated third-party dissemination by showing that the debt collectors
reported false information about the plaintiffs to a credit reporting agency and rejected any
reading of TransUnion that required the plaintiffs “to make a further showing that the third
party also shared that false information.’? Jd. at 1153-54. To determine whether the

*In so holding, the Ewing court rejected any comparison of credit reporting agencies to printing vendors, to which
disclosures have traditionally not been found to rise to actionable publications. 24 F.4" at 1153-54 (citing
TransUnion, 594 U.S. at 434 n.6}. Specifically, the court reasoned that because the consumers “demonstrated third-
party dissemination, the [TransUnion] Court’s reference fin a footnote] to a general requirement that defamatory
content is read, not merely processed” was not implicated, Jd. ai 1154 (citing TransUnion, 594 U.S, at 434 n.6).

dissemination constituted defamation, the court then analyzed whether the credit reporting
agency understood the defamatory significance of the debt collectors’ erroneous reports.
Id. at 1154, Because the credit reporting agency’s assessment of the plaintiffs
creditworthiness took into account whether the reported debts were disputed or not, the
court found that the agency did understand the defamatory significance of the false
information in the reports, /@. As such, the plaintiffs “suffered an intangible, reputational
injury that is sufficiently concrete for purposes of Article III standing,” Jd.
This Court agrees with the Ewing Court’s analysis and joins the number of district
courts that have recognized instances where dissemination to a credit reporting agency
suffices to establish defamatory publication for standing purposes. See, e.g., Morgan v.
LYNV Funding, LLC, No. 21-12967, 2023 WL 5808365, at *5 (E.D. Mich. Sept. 7, 2023)
(citing to Ewing’s publication holding favorably but finding that plaintiff lacked concrete
injury on other grounds); Pharms vy, Nat’l Credit Sys., Inc., No. CV 619-060, 2022 WL
2346623, at *7 (S.D. Ga. June 29, 2022) Cinding a credit reporting agency to be a third-
patty for defamation purposes but noting that false information about plaintiff's debt was
further disseminated to potential creditors). By reporting the errant monthly payment
obligations to Experian, Capital One has communicated allegedly false information about
Plaintiff's financial standing to an entity that understands and uses this information to
assess her creditworthiness. Pl.’s Supp. Br. 5. Thus, Plaintiff has demonstrated defamatory
publication and has alleged that she suffered a concrete reputational injury sufficient to
establish Article III standing for her claims.
B. Plaintiff Fails to State a Claim Under the FCRA
However, even if Plaintiff has sufficiently alleged Article LI standing, the Court
finds that Plaintiff has not stated a claim upon which relief may be granted. After review
of the parties’ previously filed submissions, the Court will grant Defendant’s motion to
dismiss under Rule 12(b)(6). Brown v. F.B.L, 793 F. Supp. 2d 368, 382 (D.D.C., 2011)
(“[T]he Court may grant a 12(b)(6) motion to dismiss sua sponte.”).
Rule 12(b)(6) provides for the dismissal of a complaint, in whole or in part, if the
plaintiff fails to state a claim upon which relief can be granted. Fed. R. Civ, P. 12(b)(6), In
reviewing a motion to dismiss under Rule 12(b)(6), “courts 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. Cty. of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008) (citation and
quotation marks omitted). The complaint’s factual allegations need not be detailed, but
they must be sufficient to raise a plaintiff's right to relief above a speculative level, such
that it is “plausible on its face.” Bell Atlantic Corp. v. Twombly, 550 U.S, 544, 555, 570
(2007); see also Umland v. PLANCO Fin. Serv., Inc., 542 F.3d 59, 64 (3d Cir, 2008). This

facial-plausibility standard is met where 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) (citing Twombly, 550 U.S, at 556).
“The FCRA was crafted to protect consumers from the transmission of inaccurate
information about them, and to establish credit reporting practices that utilize accurate,
relevant, and current information in a confidential and responsible manner.” Bibbs v. Trans
Union LLC, 43 F 4th 331, 339 (3d Cir. 2022) (citation and internal quotation marks
omitted). “The FCRA places certain duties on those who furnish information to consumer
reporting agencies.” /d. (citation and internal quotation marks omitted). “The furnisher of
information has a duty to provide accurate information to the credit reporting agency, 15
U.S.C. § 1681s—2(a), and the credit reporting agency must investigate promptly any reports
of inaccuracies, 15 U.S.C. § 1681s~2(b).” Cheadle v. Experian, No. 120CV18183, 2021
WL 3144843, at *3 (D.NJJ. July 26, 2021). “To state a viable claim under the FCRA
regarding the interplay between the furnisher and the credit reporting agency, a plaintiff
must allege that she (1) sent notice of disputed information to a consumer reporting agency,
(2) the consumer reporting agency then notified the defendant furnisher of the dispute, and
(3) the furnisher failed to investigate and modify the inaccurate information.” Jd. (citations
and internal quotation marks omitted). “[A] showing of inaccuracy is essential to a
[Section] 1681s—2(b) claim.” Shechter v. Experian Info. Sols., Inc., No. CV205552, 2021
WL 323302, at *3 (D.N.J. Jan. 31, 2021) (second alteration in original) (citation and
internal quotation marks omitted). “Only if ‘the investigation finds that the information is
incomplete or inaccurate’ must the furnisher correct the information with the [consumer
reporting agencies],” Mercedes v. Wells Fargo Home Mortg., Inc., No. CIV.A. 13-5814,
2015 WL 457299, at *3 (D.N.J. Feb. 3, 2015). “Information is ‘inaccurate’ within the
meaning of the FCRA if it is technically incorrect or if, ‘through omission, it creates a
materially misleading impression.’” Stephens v. Equifax, Inc., No. CV 22-01940, 2023 WL
8531833, at *4 (D.N.J. Feb. 24, 2023) (quoting Seamans v. Temple Univ., 744 F.3d 853,
865 (3d Cir, 2014)).
Here, Plaintiff admits that she still owes the balance of her debt to Capital One.
Compl. 7 8. Her only contention is that Capital One furnished inaccurate information to
Experian by reporting that she owes monthly payment obligations of $49.00, $72.00, and
$73.00 when her accounts were closed. Compl. {f 7-8. Plaintiff specifies that Capital One’s
reporting is “false and misleading” because it failed to follow a purported industry
standard—the Credit Reporting Resource Guide—that requires monthly installments to be
reported as $0.00 when the underlying accounts are closed, instead of the monthly amounts
previously owed, Compl. 9.4

“ In support of its argument, Capital One attaches several exhibits to its moving brief, including monthly statements
from Plaintiffs Capitai One account and letters to Plaintiff from Capital One regarding the closure of her accounts.

The Court finds that Plaintiffhas failed to allege that the tradelines issued -by Capital
One contain inaccurate information. Nothing in Capital One’s reporting makes plaintiff's
obligations look greater than they are. In fact, a report showing a $0.00 monthly obligation
would be more misleading of Plaintiff's financial obligation, because it would incorrectly
suggest that Plaintiff does not owe any balance to Capital One. Further, district courts have
“rejected the argument that failure to comply with industry standards violates the FCRA
where the information itself is nonetheless true.” Sheridan v. FLA Card Servs., N.A., No.
C13-01179, 2014 WL 587739, at *5 (N.D. Cal. Feb. 14, 2014) (reviewing FCRA claim
where plaintiff asserted that defendant violated industry standards by reporting overdue
payments while her bankruptcy was pending); see also, e.g., Dash v. Midland Funding
ELC, No. 8:16-CV-2128-T-36, 2017 WL 841116, at *3 (M.D. Fla. Mar. 3, 2017)
(collecting cases rejecting FCRA claims that rely on violations of industry standards and
finding them “persuasive” in the context of a Fair Debt Collection Practices Act claim).
Plaintiff cites to two cases, Burns v. Trans Union, LLC, No. CV 4:18-03120, 2019
WL 3890833 (D.S.C. Aug. 19, 2019) and Friedman y. CitiMortgage, Inc., No. 18 CV
11173, 2019 WL 4194350 (S.D.N_Y. Sept. 3, 2019), to argue that “[clourts have held that
reporting a scheduled monthly payment amount for a closed account is an adequate basis
for liability under the FCRA.” Opp. Br. 12. However, these cases are distinguishable from
the circumstances here. In Burns, the plaintiff alleged that the defendant violated the FCRA
by listing a monthly payment on its credit line despite the plaintiffs account being closed
and charged off. Here, Plaintiff has not alleged that her account has been similarly charged
off. In Friedman, the court found that a defendant furnished inaccurate information where
it erroneously reported that the plaintiff owed the defendant monthly payments and that the
plaintiff's pay status was late. However, there, the mortgage loan at issue had been
transferred to another lender and the plaintiff was no longer obligated to make any
payments to the defendant, causing lenders to believe that he owed more money than he
was obligated to pay. As stated supra, Plaintiff still owes the balance of her debt to Capital
One and the monthly obligations reported by Capital One do not misrepresent the total
amount of her debt. “Accordingly, because Plaintiff has failed to identify a factual
inaccuracy in [her] credit report, [she has not alleged a proper basis upon which to impose
FCRA liability on [Capital One].” Seror v. Equifax, No. CV 18-14804, 2019 WL
13396463, at *3 (D.N.J. July 8, 2019). Thus, Plaintiffs claims will be dismissed.
Vv. CONCLUSION

Goldstein Decl., Exs, 1-7. ECF No. 15-2, Plaintiff notes that she has not stipulated to the exhibits’ authenticity and
that the exhibits are not integral to her claims. Opp. Br. 7-9, She argues that the Court should not consider these
exhibits at the motion to dismiss stage, or in the alternative, should treat Capital One’s filing as a motion for summary
judgment, Opp. Br. 10-11, The Court does not need to decide this issue at this juncture because it does not rely on the
exhibits in its finding that Plaintiff has failed to state her claims under Rule 12(b)(6).

For the reasons set forth above, Capital One’s motion to dismiss, ECF No. 15, is
GRANTED. Plaintiff may file within 30 days an amended complaint that cures the
deficiencies articulated herein.
An appropriate Order accompanies this Opinion.

LA wf,
Len MA AG, Zh U
OV J. MARTINI, U.S.D.J.

Date: January 7 , 2024

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10278094. Public record. Not legal advice.