Court: District Court, D. Colorado; December 5, 2013; Federal District Court
The court denied Defendant Kroll Factual Data, Inc.'s Motion to Dismiss filed in response to Plaintiff Joseph J. Gomez's consumer class action alleging violations of the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681. The complaint asserts that Kroll, a consumer reporting agency, negligently and willfully failed to maintain accurate information in its consumer reports, specifically regarding the Office of Foreign Assets Control (OFAC) List.
Plaintiff Gomez applied for a home loan through Waterstone Mortgage Corporation, which obtained his credit report from Kroll. The report included a TruAlert section indicating a potential match with an individual on the OFAC List, despite both parties acknowledging that Gomez is not on that list, nor does he use the alias "Jose Gomez." The report incorrectly suggested a similarity to Gabriel Gomez Chavez, who is on the OFAC List, although they have different identifying details.
The court's ruling emphasized that, under Federal Rule of Civil Procedure 12(b)(6), the plaintiff's allegations must be assumed true and viewed favorably to determine if a plausible claim exists. The judge noted that the complaint presented sufficient facts to warrant proceeding with the case.
Granting a motion to dismiss is a significant action that requires careful consideration to uphold the principles of liberal pleading rules and the interests of justice. A well-pleaded complaint can advance even if a judge perceives that proving its facts is improbable. In evaluating a Rule 12(b)(6) motion, the Court focuses on the complaint's content but may also review attached documents referenced within it.
The Defendant seeks dismissal of the Amended Complaint for failing to state a claim, arguing that the Plaintiff did not allege inaccuracies in the Consumer Report and that the Defendant's procedures complied with OFAC guidance. To establish a claim for negligent noncompliance under 15 U.S.C. § 1681e(b), a plaintiff must demonstrate: (1) an inaccurate credit report, (2) the failure of the reporting agency to follow reasonable procedures, (3) injury to the plaintiff, and (4) a causal link between the agency's failure and the injury.
The Plaintiff contends that the presence of the Chavez OFAC listing on his report was misleading and incomplete, thereby constituting an inaccuracy. The Defendant counters that the report accurately notes a "similar to" status without explicitly identifying the Plaintiff as anyone on the OFAC list. The inclusion of the alias "Jose Gomez," which is not used by the Plaintiff, led to a misidentification that the Court finds sufficient to suggest inaccuracy.
Regarding the second element, reasonable procedures must reflect actions a prudent person would take under similar circumstances. The Court notes that the Defendant's current practice of cross-referencing only names against the OFAC list, without considering additional identifiers like date of birth or social security number, may not meet the standard of reasonableness. Thus, the Plaintiff's allegations adequately assert that the Consumer Report's inaccuracies stemmed from the Defendant's failure to implement reasonable procedures to ensure maximum accuracy.
The injury requirement under § 1681(e) is met when an inaccurate consumer report is shared with a third party, as established in Miller v. Trans Union, LLC. In this case, the Plaintiff's Consumer Report was provided to Waterstone on January 17, 2012, which supports the claim that the Defendant's failure to ensure the report's accuracy resulted in injury to the Plaintiff. The Court concludes that the Plaintiff has adequately alleged all four elements of his Fair Credit Reporting Act (FCRA) claim, leading to the denial of the Defendant's Motion to Dismiss. The Plaintiff represents two groups: individuals named 'Joseph' or 'Jose' Gomez who had a consumer report sold by the Defendant that included an OFAC record, and individuals associated with a specific TruAlert entry for Gabriel Gomez Chavez (with a birth date of August 1962), excluding a Mexican national of the same name. The Court observes that the Plaintiff's information does not match that of Gabriel Gomez Chavez. The parties are currently addressing the Plaintiff's Motion for Leave to File a Second Amended Complaint, which is not significantly different from the Amended Complaint the Court has chosen not to dismiss. The Court anticipates that the Defendant will prioritize the Motion for Class Certification rather than contest the Second Amended Complaint.
